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HomeMy WebLinkAbout5.1d Cottage Grove - Purchase Agreement EDA - Syndica - Outlot A and Lot 1 2-4-22 clean 1 PURCHASE AGREEMENT THIS PURCHASE AGREEMENT (this “Agreement”) is entered into as of February _____, 2022 (the “Effective Date”), by and between the Cottage Grove Economic Development Authority, a public body corporate and politic under the laws of Minnesota (“EDA” or “Seller”), and Syndica, LLP, a North Dakota limited liability partnership (“Syndica” or “Buyer”). RECITALS Recital No. 1. Glendenning Farms, L.P., WAG Farms, Inc. and Joan Glendenning Kennedy Family Limited Partnership (collectively “Owner of Parcel 1”) are the owners of 22.4 acres of unimproved real property, located in Cottage Grove, Washington County, Minnesota, legally described on Exhibit A as Parcel 1 (“Parcel 1”), attached hereto and incorporated herein by reference. Recital No. 2. EDA is the contract purchaser of Parcel 1. Recital No. 3. EDA is the owner of approximately 3 acres of unimproved real property, located in Cottage Grove, Washington County, Minnesota, legally described on Exhibit A as Parcel 2 (“Parcel 2”). Recital No. 4. Parcel 1 and Parcel 2 are collectively known as the “Property.” Recital No. 5. EDA and shall purchase Parcel 1 from Owner of Parcel 1 and convey the Property to Syndica on the terms and conditions of this Agreement. Recital No. 6. Syndica desires to purchase the Property from Seller on the terms and conditions of this Agreement. NOW, THEREFORE, Syndica and EDA agree as follows: 1. Sale. 1.1. Sale. Subject to the terms and provisions of this Agreement, EDA shall sell the Property to Syndica, and Syndica shall purchase the Property from EDA, together with (a) any fixtures and improvements located or constructed on the Property. 1.2. Purchase Price. The purchase price to be paid by Syndica to EDA for the Property shall be Three Dollars and 50/100 ($3.50) multiplied by 1,106,424 square feet as finally determined by the Survey (as defined below) (the “Purchase Price”). The Purchase Price of Three Million Eight Hundred Seventy-Two Thousand, Four Hundred and Eighty- Four 00/100s Dollars ($3,872,484) (subject to adjustment as the result of the Survey) shall be payable as follows: (a) Fifty Thousand and No/100 Dollars ($50,000.00), as earnest money, to be paid within three (3) business days following the Effective Date to DCA Title, 7373 147th Street West, Apple Valley, MN 55124 (“Title”), to be held in escrow by Title 2 (“Earnest Money”); and (b) the balance of the Purchase Price on the Closing Date (as defined in Section 6) subject to those adjustments, prorations and credits described in this Agreement, in certified funds or by wire transfer pursuant to instructions from EDA. The Earnest Money shall be applied to the Purchase Price at Closing. 2. Available Surveys, Tests, and Reports. Within ten (10) days following the Effective Date, EDA shall cause to be delivered to Syndica (a) copies of any surveys, soil tests, soil/geotechnical reports, environmental reports, environmental surveys, and any other studies and/or site analyses previously conducted on the Property and in the possession of EDA, (b) copies of existing title work for the Property and in the possession of EDA, (c) copies of all lease agreements related to the Property, current and past, (d) copies of all agreements, easements, contracts or service contracts related to the Property, and (e) any correspondence regarding wetlands (the “Due Diligence Materials”). EDA makes no representations or warranties regarding the accuracy of the Due Diligence Materials. If Buyer so requests, Seller shall request the preparers of any such surveys, soil tests, environmental reports, and any other studies and/or site analyses to re-issue or re-certify the same for the direct benefit of Buyer, at Buyer’s expense except as otherwise provided in this Agreement, so that Buyer may rely on such site analyses or surveys as if prepared for Buyer in the first instance, but Seller makes no representation as to whether any such reissuance or recertification will be available. 3. Syndica’s Investigations. For a period up to the Closing Date, EDA shall allow Syndica (and shall ensure that the Owner of Parcel 1 will allow) Buyer and Buyer’s agents access to the Property without charge and at all times for the purpose of Syndica’s investigation and testing of the Property, including surveying and testing of soil and groundwater (“Syndica’s Investigations”); provided, however, Syndica shall not perform any invasive testing unless (a) EDA gives its prior written approval of Syndica’s consultant that will perform the testing, which approval shall not be unreasonably withheld, conditioned or delayed, and (b) Syndica gives EDA reasonable prior notice of such testing. EDA shall have the right to accompany Syndica during any of Syndica’s Investigations of the Property, provided that such right shall not delay Syndica’s Investigations. Syndica shall provide to EDA copies of all third-party, non-confidential written test results and reports conducted as part of Syndica’ Investigations. Except as otherwise provided herein, Syndica agrees to pay all of the costs and expenses associated with Syndica’s Investigations, to cause to be released any lien on the Property arising as a result of Syndica’s Investigations and to repair and restore, at Syndica’ expense, any damage to the Property caused by Syndica’s Investigations. Syndica shall indemnify and hold EDA and the Property harmless from all costs and liabilities, including, but not limited to, reasonable attorneys’ fees, arising from Syndica’ Investigations. (excluding, however, any liability arising out of or related to pre-existing conditions discovered by but not created or exacerbated by Buyer). The indemnification obligations provided herein shall survive the termination or cancellation of this Agreement. If this Agreement is terminated based upon any environmental condition as herein provided, and EDA requests, Syndica shall give EDA copies of any and all AUAR, Phase I and/or Phase II reports obtained by Syndica, if any. 4. Insurance; Risk of Loss. EDA assumes all risk of destruction, loss or damage to the Property prior to the Closing Date. If, prior to the Closing Date, all or any portion of the Property or access thereto is condemned, taken by eminent domain, or damaged by cause of any 3 nature, EDA shall immediately give Syndica written notice of such condemnation, taking or damage. After receipt of written notice of such condemnation, taking or damage (from EDA or otherwise), Syndica shall have the option (to be exercised in writing within thirty (30) days of receipt of such written notice from EDA) either (a) to require EDA to (i) convey the Property at Closing (as defined in Section 6) to Syndica in its damaged condition, upon and subject to all of the other terms and conditions of this Agreement without reduction of the Purchase Price, (ii) assign to Syndica at Closing all of EDA’s right, title and interest in and to any claims EDA may have to insurance proceeds, condemnation awards and/or any causes of action with respect to such condemnation or taking of or damage to the Property or access thereto, and (iii) pay to Syndica at Closing by certified or official bank check all payments made prior to the Closing Date under such insurance policies or by such condemning authorities, or (b) to terminate this Agreement by giving written notice of such termination to EDA, whereupon this Agreement shall be terminated, the Earnest Money shall be refunded to Syndica and thereafter neither party shall have any further obligations or liabilities to the other, except for such obligations as survive termination of this Agreement. If the right to terminate this Agreement is not exercised in writing within such thirty (30) day period, such right shall be deemed to have been waived. EDA shall not designate counsel, appear in, or otherwise act with respect to the condemnation proceedings without Syndica’ prior written consent, which consent shall not be unreasonably withheld. 5. Contingencies. 5.1. Syndica’s Contingencies. A. Unless waived by Syndica in writing, Syndica’s obligation to proceed to Closing shall be subject to (a) performance by EDA of its obligations hereunder, (b) the continued accuracy of EDA’s representations and warranties provided in Section 9.1, and (c) Syndica’s satisfaction, in Syndica’s sole discretion, as to the contingencies described in this Section 5.1 within the time periods set forth below: (1) On or before the Closing Date, Syndica shall have determined, in its sole discretion, that it is satisfied with (a) the results of and matters disclosed by Syndica’s Investigations, surveys, soil tests, engineering inspections, hazardous substance and environmental reviews of the Property, (b) all other inspections and due diligence regarding the Property, including any Due Diligence Materials. (2) On or before the Closing Date, Syndica shall have determined the acceptability and zoning of the Property for its proposed use as a warehouse and parking lot and other uses related thereto (collectively, the “Proposed Use”). All costs and expenses related to applying for and obtaining any governmental permits and approvals for the Property for the Proposed Use shall be the responsibility of the Syndica. (3) On or before the Closing Date, Syndica shall have received from Title an irrevocable commitment to issue a title insurance policy for 4 the Property in a form and substance satisfactory to Syndica in Syndica’s sole discretion, not disclosing any encumbrance not acceptable to Syndica in Syndica’s sole discretion. (4) On or before the Closing Date, EDA shall have obtained releases of the Property from any and all mortgages or other monetary liens affecting any of the Property. (5) On or before the Closing Date, Syndica shall have determined that it is satisfied with the books and records in EDA’s possession, if any, including site plans, surveys, engineering or environmental reports associated with the Property. (6) On or before the Closing Date, Syndica shall have secured financing that is satisfactory to Syndica in Syndica’s sole discretion for the purpose of acquiring and constructing the Proposed Use. (7) On or before the Closing Date, Syndica may obtain an ALTA Survey for the Property certified to Syndica and Title. (8) On or before the Closing Date, Syndica shall have obtained approval of the transaction by the partners of Governors of Syndica. (9) On or before the Closing Date, the Owner of Parcel 1 shall execute and record an easement for a water main in favor of the City of Cottage Grove for Parcel 1. (10) On or before the Closing Date, the EDA shall execute and record an easement for a water main in favor of the City of Cottage Grove for Parcel 2. (11) On or before the Closing Date, Syndica shall have approved the forms of all closing documents. (12) EDA shall have performed and satisfied all agreements, covenants and conditions required pursuant to this Agreement to be performed and satisfied by EDA prior to the Closing Date, including the acquisition of Parcel 1. (13) All representations and warranties of EDA contained in this Agreement shall be accurate as of the Closing Date. The foregoing contingencies are for Syndica’s sole and exclusive benefit and one (1) or more may be waived in writing by Syndica in its sole discretion. EDA shall reasonably cooperate with Syndica’s efforts to satisfy such contingencies, at no out of pocket cost to EDA or assumption of any obligation or 5 liability by Syndica except as otherwise provided herein. Syndica shall bear all cost and expense of satisfying Syndica’s contingencies. If any of the foregoing contingencies have not been satisfied on or before the applicable date, then this Agreement may be terminated, at Syndica’s option, by written notice from Syndica to EDA. Such written notice must be given on or before the applicable date, or Syndica’s right to terminate this Agreement pursuant to this Section shall be waived. If Syndica terminates this Agreement pursuant to this Section, the Earnest Money shall immediately be refunded to Syndica. Upon termination, neither party shall have any further rights or obligations against the other regarding this Agreement or the Property, except for such obligations as survive termination of this Agreement. B. If Syndica elects not to exercise any of the contingencies set out herein, such election may not be construed as limiting any representations or obligations of EDA set out in this Agreement, including, without limitation, any indemnity or representations with respect to environmental matters. 5.2. EDA’s Contingencies. EDA’s obligation to proceed to Closing shall be subject to the satisfaction, on or prior to the Closing Date, of each of the following conditions: A. EDA shall have acquired Parcel 1 from Owner of Parcel 1, and the EDA agrees to use its best efforts to effectuate such transaction. B. On or before the Closing Date, the Owner of Parcel 1 shall execute and record an easement for a water main in favor of the City of Cottage Grove for Parcel 1. C. On or before the Closing Date, the EDA shall execute and record an easement for a water main in favor of the City of Cottage Grove for Parcel 2. D. Syndica shall have performed and satisfied all agreements, covenants and conditions required pursuant to this Agreement to be performed and satisfied by Syndica prior to the Closing Date. E. All representations and warranties of Syndica contained in this Agreement shall be accurate as of the Closing Date. F. There shall be no uncured material default by Syndica of any of its obligations under this Agreement as of the Closing Date, not otherwise waived by EDA. If any contingency contained in this Section 5.2 has not been satisfied on or before the date described herein, and if no date is specified, then the Closing Date, then this Agreement may be terminated by written notice from the EDA to Syndica. If termination occurs all documents deposited by Syndica shall be immediately 6 returned to Syndica, and all documents deposited by the EDA shall be immediately returned to the EDA and neither party will have any further rights or obligations with respect to this Agreement or the Property, except for such obligations that survive termination of this Agreement. All the contingencies in this Section 5.2 are specifically for the benefit of the EDA, and the EDA shall have the right to waive any contingency in this Section 5.2 by written notice to Syndica. 6. Closing. The closing of the purchase and sale contemplated by this Agreement (the “Closing”) shall occur on or before June 30, 2022 (the “Closing Date”); provided, however, Syndica shall have the right and option to extend the Closing Date for up to two (2) periods of thirty (30) days each. (“First Extension Option” and “Second Extension Option”, respectively) Syndica shall exercise its right and option to extend the Closing Date, if at all, by giving EDA notice of such election on or before the Closing Date, as the same may be extended. Upon the exercise of the First Extension Option, $35,000 of the original Earnest Money will become nonrefundable. Upon exercise of the Second Extension Option, the balance of the original Earnest Money will become nonrefundable. If the parties proceed to Closing, the Earnest Money will be applied to the Purchase Price. EDA agrees to deliver legal and actual possession of the Property to Syndica on the Closing Date, as the same may be extended. 6.1. EDA’s Closing Documents and Deliveries. On the Closing Date, EDA shall execute and/or deliver, as applicable, to Syndica the following: A. Warranty Deed. A warranty deed conveying title to the Property to Syndica, free and clear of all encumbrances, except the Permitted Encumbrances (the “Deed”), and such other instruments appropriate for the conveyance and transfer of the Property (including an electronic certificate of real estate value and a well disclosure certificate, if applicable). B. Recertification of Representations and Warranties. EDA shall provide Syndica with a certificate recertifying that the representations and warranties set forth in Section 9 of this Agreement are true and correct as of the Closing Date. C. FIRPTA Affidavit. An affidavit of EDA certifying that EDA is not a “foreign person”, “foreign partnership”, foreign trust”, “foreign estate” or “disregarded entity” as those terms are defined in Section 1445 of the Internal Revenue Code of 1986, as amended. D. EDA’s Affidavit. A standard owner’s affidavit (ALTA form) from EDA which may be reasonably required by Title to issue an owner’s policy of title insurance with respect to the Property with the so-called “standard exceptions” deleted. E. Settlement Statement. A settlement statement with respect to this transaction. 7 F. Copies of Resolutions. EDA shall provide Syndica with copies of the resolutions for the various EDA and/or City public meetings showing the EDA and/or various City commissions and/or councils have approved this transaction, Syndica’ CUP, Syndica’ site plan, zoning, and such other governmental approvals as may be required for Syndica’ Proposed Use. G. General Deliveries. All other documents reasonably determined by Title to be necessary to transfer the Property to Syndica and to evidence that EDA (a) has satisfied all monetary indebtedness with respect thereto, (b) has obtained such termination statements or releases from such secured creditors as may be necessary to ensure that the Property is subject to no monetary liens, (c) has obtained all consents from third parties necessary to effect EDA’s performance of the terms of this Agreement, including, without limitation, the consents of all parties holding an interest in the Property, (d) has provided such other documents as are reasonably determined by Title to be necessary to issue policies of title insurance to Syndica with respect to the Property with the so-called “standard exceptions” deleted, and (e) has duly authorized the transactions contemplated hereby. 6.2. Syndica Closing Documents and Deliveries. On the Closing Date, Syndica shall execute and/or deliver, as applicable, to EDA the following: A. Payment of Purchase Price. The Purchase Price, in accordance with the terms of Section 1.2. B. FIRPTA Affidavit. An affidavit of Syndica certifying that Syndica is not a “foreign person”, “foreign partnership”, foreign trust”, “foreign estate” nor a “disregarded entity” as those terms are defined in Section 1445 of the Internal Revenue Code of 1986, as amended. C. Syndica’s Affidavit. A standard owner’s affidavit (ALTA form) from Syndica which may be reasonably required by Title to issue an owner’s policy of title insurance with respect to the Property with the so-called “standard exceptions” deleted. D. Bring-Down Certificate. A certificate dated as of the Closing Date, signed by an authorized officer of Syndica, certifying that the representations and warranties of Syndica contained in this Agreement are true as of the Closing Date. E. Settlement Statement. A settlement statement with respect to this transaction. F. Evidence of Authority. Syndica shall provide EDA with copies of the resolutions showing Syndica has met with necessary requirements to acquire the Property in accordance with this Agreement together with such proceedings, 8 instruments and documents as may be reasonably required by Title as a condition precedent to issuing the Title Policy in Syndica’s name. G. General Deliveries. All other documents reasonably determined by Title to be necessary to evidence that Syndica has duly authorized the transactions contemplated hereby and evidence the authority of Syndica to enter into and perform this Agreement and the documents and instruments required to be executed and delivered by Syndica pursuant to this Agreement, or may be required of Syndica under applicable law, including any purchaser’s affidavits or revenue or tax certificates or statements. 7. Prorations. EDA and Syndica agree to the following prorations and allocation of costs regarding this Agreement: 7.1. Title Evidence, Survey and Closing Fee. EDA shall pay all costs of the Commitment with respect to the Property. Syndica will pay all costs of the Survey, if any, and all premiums for any title insurance policy it desires with respect to the Property. Syndica and EDA shall each pay one half (1/2) of any reasonable closing fee or charge imposed by Title. 7.2. Transfer Taxes. EDA shall pay all state deed tax regarding the Deed. 7.3. Recording Costs. EDA will pay the cost of recording all documents necessary to place record title to the Property in the EDA including, but not limited to, costs of recording any documents necessary to cure any Objections, as hereinafter defined. EDA will pay for the recording cost of the utility easement. Syndica will pay all recording costs with respect to the recording of the Deed and for the recording of any mortgage required by Syndica, if any, and any mortgage registration tax, if any. 7.4. Real Estate Taxes and Special Assessments. General real estate taxes applicable to any of the Property due and payable in the year of Closing shall be prorated between EDA and Syndica on a daily basis as of 12:00 a.m. CT on the Closing Date based upon a calendar fiscal year, with EDA paying those allocable to the period prior to the Closing Date and Syndica being responsible for those allocable to the Closing Date and subsequent thereto. EDA shall pay in full all special assessments (and charges in the nature of or in lieu of such assessments) levied, pending, postponed or deferred with respect to any of the Property as of the Closing Date. Syndica shall be responsible for any special assessments that are levied or become pending against the Property after the Closing Date, including, without limitation, those related to Syndica’s development of the Property. 7.5. Utilities. All utility expenses, including water, fuel, gas, electricity, sewer and other services furnished to or provided for the Property, if any, shall be prorated between EDA and Syndica on a daily basis as of the Closing Date, with EDA paying those allocable to the period prior to the Closing Date and Syndica being responsible for those allocable to the Closing Date and subsequent thereto. 9 7.6. ALTA Survey. Syndica may obtain and pay for an ALTA Survey (“ALTA Survey”). 7.7. Attorneys’ Fees. EDA and Syndica shall each pay its own attorneys’ fees incurred in connection with this transaction, except as otherwise specifically set forth in this Agreement. 7.8. Survival. The obligations set forth in this Section 7 survive the Closing. 8. Title Examination. (i) Within seven (7) days following the Effective Date, EDA shall, at EDA’s expense, provide a commitment dated within sixty (60) days of the Effective Date for an owner’s title insurance policy (ALTA Form 2006) issued by Title for the Property, and copies of all encumbrances described in the commitment (the “Commitment”); and, if desired, (ii) within fifteen (15) days following the Effective Date, Syndica shall obtain, at Syndica’s expense, an ALTA-certified survey bearing the legal description of the Property, and showing the area, dimensions and location of the Property and the matters shown in the Commitment (the “Survey” and, together with the Commitment, the “Title Evidence”). 8.1. Syndica’s Objections. Within twenty (20) days after Syndica’s receipt of the last of the Title Evidence, Syndica may make written objections (“Objections”) to the form or content of the Title Evidence. The Objections may include, without limitation, any easements, restrictions or other matters which may interfere with the Proposed Use of the Property or matters which may be revealed by the Survey. Objection to monetary liens shall be presumed. Any matters reflected on the Title Evidence which are not objected to by Syndica within such time period or waived by Syndica in accordance with Section 8.2(B) shall be deemed to be permitted encumbrances (“Permitted Encumbrances”). Notwithstanding the foregoing, the following items shall be deemed Permitted Encumbrances: (a) Covenants, conditions, restrictions (without effective forfeiture provisions) and declarations of record which do not interfere with the Proposed Use, if any; (b) Reservation of minerals or mineral rights by the State of Minnesota, if any; (c) Utility and drainage easements which do not interfere with the Proposed Use; and (d) Applicable laws, ordinances, and regulations. Syndica shall have the renewed right to object to the Title Evidence as the same may be revised or endorsed from time to time. 8.2. EDA’s Cure. EDA shall be allowed twenty (20) days after the receipt of Syndica’s Objections to cure the same but shall have no obligation to do so. If such cure is not completed within said period, or if EDA elects not to cure such Objections, Syndica shall have the option to do any of the following: A. Terminate this Agreement with respect to all of the Property. B. Waive one or more of its objections and proceed to Closing. If Syndica so terminates this Agreement, neither EDA nor Syndica shall be liable to the other for any further obligations under this Agreement (except for such obligations as 10 survive termination of this Agreement) and the Earnest Money shall be refunded to Syndica. 9. Warranties and Representations. 9.1. By EDA. EDA warrants and represents the following to Syndica, and acknowledges that Syndica has relied on such representations and warranties in agreeing to enter into this Agreement: A. This Agreement has been duly executed and delivered and constitutes the legal, valid and binding obligation of EDA enforceable in accordance with its terms. EDA has been duly formed under the laws of the State of Minnesota and is in good standing under the laws of the jurisdiction in which the Property is located, is duly qualified to transact business in the jurisdiction in which the Property is located, and has the requisite power and authority to enter into and perform this Agreement and the documents and instruments required to be executed and delivered by EDA pursuant hereto. This Agreement and the documents and instruments required to be executed and delivered by EDA pursuant hereto have each been duly authorized by all necessary action on the part of EDA and such execution, delivery and performance does and will not conflict with or result in a violation of EDA’s organizational agreement or any judgment or order. B. The execution, delivery and performance by EDA of this Agreement will not (a) violate any provision of any law, statute, rule or regulation or any order, writ, judgment, injunction, decree, determination or award of any court, governmental agency or arbitrator presently in effect having applicability to EDA, or (b) result in a breach of or constitute a default under any indenture, loan or credit agreement or any other agreement, lease or instrument to which EDA is a party or by which it or any of its properties may be bound. C. To EDA’s knowledge, except as contemplated herein, no order, consent, approval, license, authorization or validation of, or filing, recording or registration with, or exemption by, any governmental or public body or authority, or any other entity, is required on the part of EDA to authorize, or is required in connection with, the execution, delivery and performance of, or the legality, validity, binding effect or enforceability of, this Agreement. D. To EDA’s knowledge, there are no actions, suits or proceedings pending or threatened against or affecting EDA or any of its properties, before any court or arbitrator, or any governmental department, board, agency or other instrumentality which in any of the foregoing (a) challenges the legality, validity or enforceability of this Agreement, or (b) if determined adversely to EDA, would have a material adverse effect on the ability of EDA to perform its obligations under this Agreement. 11 E. EDA has not received written notice, and has no knowledge, of (a) any pending or contemplated annexation or condemnation proceedings, or purchase in lieu of the same, affecting or which may affect all or any part of the Property, (b) any proposed or pending proceeding to change or redefine the zoning classification of all or any part of the Property, (c) any proposed changes in any road patterns or grades which would adversely and materially affect access to the roads providing a means of ingress or egress to or from all or any part of the Property, or (d) any uncured violation of any legal requirement, restriction, condition, covenant or agreement affecting all or any part of the Property or the use, operation, maintenance or management of all or any part of the Property. F. To EDA’s knowledge, there are no tanks, wells or sewage treatment systems located on any portion of the Property. To EDA’s knowledge, there has been no methamphetamine production on or about any portion of the Property. To EDA’s knowledge, the sewage generated by the Property, if any, goes to a facility permitted by the Minnesota Pollution Control Agency and there is no “individual sewage treatment system” (as defined in Minnesota Statutes § 115.55, Subd. 1(g)) located on the Property. G. EDA is not a “foreign person,” “foreign corporation,” “foreign trust,” “foreign estate” or “disregarded entity” as those terms are defined in Section 1445 of the Internal Revenue Code. H. To EDA’s knowledge, except as may be disclosed as part of the Due Diligence Materials, (i) no condition exists on the Property that may support a claim or cause of action under any Environmental Law (as defined below) and there are no Hazardous Substances (as defined below) on the Property, (ii) there has been no release, spill, leak or other contamination or otherwise onto the Property, and (iii) there are no restrictions, clean ups or remediation plans regarding the Property. To EDA’s knowledge, except as may be disclosed as part of the Due Diligence Materials, there is no buried waste or debris on any portion of the Property. “Environmental Law” shall mean (a) the Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 U.S.C. § 9601-9657, as amended, or any similar state law or local ordinance, (b) the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901, et seq., (c) the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., (d) the Clean Air Act, 42 U.S.C. § 7401, et seq., (e) the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., (f) the Safe Drinking Water Act, 42 U.S.C. § 300(f) et seq., (g) any law or regulation governing aboveground or underground storage tanks, (h) any other federal, state, county, municipal, local or other statute, law, ordinance or regulation, including, without limitation, the Minnesota Environmental Response and Liability Act, Minn. Stat. § 115B.01, et seq., (i) all rules or regulations promulgated under any of the foregoing, and (j) any amendments of the foregoing. “Hazardous Substances” shall mean polychlorinated biphenyls, petroleum, including crude oil or any fraction thereof, petroleum products, heating oil, natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel, and shall include, without limitation, substances 12 defined as “hazardous substances,” “toxic substances,” “hazardous waste,” “pollutants or contaminants” or similar substances under any Environmental Law. I. There are no leases or tenancies with respect to the Property that will not be terminated as of the Closing Date. There are no unrecorded agreements or other contracts of any nature or type relating to, affecting or serving the Property beyond the agreements to acquire the Property from Owner. J. EDA has the right to acquire the Property from Owner in sufficient time to perform its obligations under this Agreement in a timely manner. K. There will be no indebtedness or sums due attributable to the Property which will remain unpaid after the Closing Date. As used in this Agreement, the term “to EDA’s knowledge” shall mean and refer to only the current actual knowledge of the designated representative of EDA and shall not be construed to refer to the knowledge of any other officer, manager, director, agent, authorized person, employee or representative of EDA, or any affiliate of EDA, or to impose upon such designated representative any duty to investigate the matter to which such actual knowledge or the absence thereof pertains, or to impose upon such designated representative any individual personal liability. As used herein, the term “designated representative” shall refer to Jennifer Levitt. EDA represents and warrants that the foregoing individual is the representative of EDA most knowledgeable regarding the Property. The representations, warranties and other provisions of this Section 9.1 shall survive Closing; provided, however, EDA shall have no liability with respect to any breach of a particular representation or warranty if Syndica shall fail to notify EDA in writing of such breach within two (2) years after the Closing Date, and provided further that EDA shall have no liability with respect to a breach of the representations and warranties set forth in this Agreement if Syndica has actual knowledge of EDA’s breach thereof prior to Closing and Syndica consummates the acquisition of the Property as provided herein. Syndica acknowledges and agrees that, except as expressly specified in this Agreement and/or in any documents executed and delivered by the EDA at Closing, EDA has not made, and EDA hereby specifically disclaims, any representation, warranty or covenant of any kind, oral or written, expressed or implied, or rising by operation of law, with respect to the Property, including, but not limited to, any warranties or representations as to the habitability, merchantability, fitness for a particular purpose, title, zoning, tax consequences, physical or environmental condition, utilities, valuation, governmental approvals, the compliance of the Property with governmental laws, or any other matter or item regarding the physical condition of the Property. Syndica agrees that except as expressly specified in this Agreement and/or in any documents executed and delivered by the EDA at Closing, Syndica shall accept the Property and acknowledges that the sale of the Property as provided for herein is made by EDA on an “AS IS,” “WHERE IS,” and “WITH ALL FAULTS” basis. Syndica is an experienced purchaser of property such as 13 the Property and Syndica has made or will make its own independent investigation of the Property. The limitations set forth in this paragraph shall survive the Closing and shall not merge in the deed. 9.2. By Syndica. Syndica warrants and represents the following to EDA, and acknowledges that EDA has relied on such representations and warranties in agreeing to enter into this Agreement: A. Syndica is a limited liability partnership, duly organized and in good standing as a foreign limited liability partnership under the laws of the state of Minnesota and is not in violation of any provisions of its partnership documents or its partnership agreement. B. Syndica has all requisite authority to enter into this Agreement and to perform all of its obligations under this Agreement. C. The execution, delivery and performance by Syndica of this Agreement will not (a) violate any provision of any law, statute, rule or regulation or any order, writ, judgment, injunction, decree, determination or award of any court, governmental agency or arbitrator presently in effect having applicability to Syndica, (b) violate or contravene any provision of the partnership agreement of Syndica, or (c) result in a breach of or constitute a default under any indenture, loan or credit agreement or any other agreement, lease or instrument to which Syndica is a party or by which it or any of its properties may be bound. The representations, warranties and other provisions of this Section 9.2 shall survive Closing; provided, however, Syndica shall have no liability with respect to any breach of a particular representation or warranty if EDA shall fail to notify Syndica in writing of such breach within two (2) years after the Closing Date. 10. Additional Obligations of EDA. 10.1. Licenses and Permits. EDA shall transfer to Syndica all transferable rights, if any, in any permits or licenses held by EDA with respect to the Property. EDA shall execute all applicable transfer forms and applications to facilitate and effect any such transfer and to cooperate fully with Syndica in its efforts to obtain all of the necessary licenses and permits for the Proposed Use, at no out-of-pocket cost to EDA, or the assumption of any obligations or liabilities by EDA. 10.2. Condition of the Property at Closing. Prior to Closing, the Property shall be operated in the ordinary course consistent with previous practice. On the Closing Date, EDA shall deliver to Syndica exclusive vacant possession of the Property, free and clear of any personal property, surface waste and surface debris of any kind. On or before the Closing Date, EDA shall remove all trash and personal property from the Property. EDA agrees that Syndica may dispose of any trash or personal property remaining on the Property as of the Closing Date in Syndica’ sole discretion and EDA agrees to pay for all 14 costs and expenses incurred by Syndica with respect to the transport and/or disposal of the personal property within ten (10) days after receipt of an invoice from Syndica. 10.3. Further Assurances. From and after the Closing Date, EDA agrees to execute, acknowledge and deliver to Syndica such other documents or instruments of transfer or conveyance as may be reasonably required to carry out its obligations pursuant to this Agreement. 10.4. Non-Assumption of Contracts or Other Obligations. The parties understand and agree that Syndica is only acquiring certain of EDA’s real property assets and that this Agreement and any related agreements shall not be construed to be in any manner whatsoever an assumption by Syndica of any agreements, indebtedness, obligations or liabilities of EDA which are owing with respect to the operation of the Property prior to the Closing Date. 10.5. Mortgages. On or before the Closing Date, EDA shall satisfy all mortgage and/or lien indebtedness with respect to all or any portion of the Property and shall obtain recordable releases of the Property from any and all such mortgages or other liens affecting all or any portion of the Property. 10.6. Approvals. Syndica may elect to seek certain approvals in order for Syndica to develop the Property for the Proposed Use, including rezoning the Property or receipt of a conditional use permit (the “Approvals”). EDA, at no out-of-pocket cost to EDA, or the assumption of any obligations or liabilities by EDA, will reasonably cooperate with Syndica’s efforts to obtain the Approvals at or prior to Closing. EDA hereby grants Syndica the right to file and prosecute applications and petitions for the Approvals and any special use permits and variances desired by Syndica; provided, however, any special use permits or variances shall be contingent on the occurrence of the Closing and shall not be binding upon EDA or the Property unless and until the Closing occurs. EDA, at no out-of- pocket cost to EDA, or the assumption of any obligations or liabilities by EDA, agrees to cooperate with Syndica in the filing and prosecution of such applications and petitions, including the filing of the same in EDA’s name, if required. 11. Commissions. Buyer represents that it has been represented by Andy Heieie of Colliers and that Seller shall be solely responsible for paying Syndica’s Broker a commission equal to 5% of the Purchase Price at Closing. 12. Notice. Any notice to be given by one party hereto shall be personally delivered (including messenger delivery) or be sent by registered or certified mail, or by a nationally recognized overnight courier which issues a receipt, in each case postage prepaid, to the other party at the addresses in this Section (or to such other address as may be designated by notice given pursuant to this Section), and shall be deemed given upon personal delivery, three (3) days after the date postmarked or one (1) business day after delivery to such overnight courier. Attorneys for each party shall be authorized to give and receive notices for each such party. If to EDA: Cottage Grove Economic Development Authority 15 12800 Ravine Parkway South Cottage Grove MN 55016 Attn: Jennifer Levitt, EDA Executive Director with a copy to: Korine L. Land LeVander, Gillen & Miller, P.A. 1305 Corporate Center Dr., Suite 300 Eagan, MN 55121 If to Syndica: Syndica LLP 300 23rd Ave. E. Suite 300 West Fargo, ND 58078 13. Default; Remedies. In addition to the rights granted to the parties pursuant to Minn. Stat. Sec. 559.21, if either EDA or Syndica fails to perform any of its obligations under this Agreement in accordance with its terms, and such failing party does not cure such failure within thirty (30) days after written notice thereof from the other party (provided that no notice or cure period shall be required for obligations to be performed at Closing), then the other party shall have the right to terminate this Agreement by giving the failing party written notice of such election. In the case of any default by Syndica, EDA’s sole and exclusive remedies shall be termination of this Agreement as provided above and, upon any such termination, the Earnest Money shall be forfeited to Seller as agreed and final liquidated damages. In the case of any default by EDA, Syndica’s sole and exclusive remedies shall be (i) specifically enforce this Agreement, or (ii) terminate this Agreement, in which case the Earnest Money shall be returned to Syndica as agreed and final liquidated damages. In no event shall Syndica be entitled to record a notice of Lis Pendens against the Property, unless Syndica is pursuing specific performance of this Agreement. In any action or proceeding to enforce this Agreement or any term hereof, the prevailing party shall be entitled to recover its reasonable costs and attorneys’ fees. 14. Cumulative Rights. No right or remedy conferred or reserved to EDA or Syndica is intended to be exclusive of any other right or remedy herein or by law provided, but each shall be cumulative in and in addition to every other right or remedy existing at law, in equity or by statute, now or hereafter, except as provided in Section 13 of this Agreement. 15. Entire Agreement; Modification. This written Agreement constitutes the complete agreement between the parties with respect to this transaction and supersedes any prior oral or written agreements between the parties regarding this transaction. There are no verbal agreements that change this Agreement and no waiver of any of its terms will be effective unless in writing executed by the parties. 16. Binding Effect; Survival. This Agreement binds and benefits the parties and their respective successors and assigns. All representations and warranties, and indemnification obligations of the parties hereto shall survive the Closing. 17. Governing Law. The provisions of this Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota. 16 18. Rules of Interpretation. The words “herein” and “hereof” and words of similar import, without reference to any particular section or subdivision, refer to this Agreement as a whole rather than any particular section or subdivision hereof. References herein to any particular section or subdivision hereof are to the section or subdivision of this Agreement as originally executed. 19. Titles of Sections. Any titles of the sections, or any subsections, of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. 20. Counterparts; Facsimiles. This Agreement may be executed in any number of counterparts, and all of the signatures to this Agreement taken together shall constitute one and the same agreement, and any of the parties hereto may execute such agreement by signing any such counterpart. Facsimile or “PDF” signatures on this Agreement shall be treated as originals until the actual original signatures are obtained. 21. Represented by Counsel. Each party has been represented and advised by counsel in the transaction contemplated hereby. 22. Time of the Essence. Time is of the essence of this Agreement. [remainder of page intentionally blank] 17 IN AGREEMENT, the parties hereto have hereunto set their hands as of the Effective Date. COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY By ________________________________ Myron Bailey Its President By ________________________________ Jennifer Levitt Its Executive Director 18 SYNDICA, LLP By: Name: Title: A-1 EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY Real property located in the County of Washington, State of Minnesota, legally described as follows: Parcel 1 Outlot A, Glengrove Industrial Park 5th Addition Abstract Property PID 20.027.21.42.0009 Parcel 2 Lot 1, Block 1, Glengrove Industrial Park 5th Addition, Except the South 50 feet, Washington County, Minnesota. Abstract Property PID 20.027.21.43.0011 [Commitment legal description to govern]