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5.2 EDSR 10-20-2014 El , Request for Action River To Item Number Economic Development Authority 5.2 Agenda Section Meeting Date Prepared by Public Hearings October 20, 2014 Jeremy Barnhart, Deputy Director, CODD Item Description Reviewed by Sell a 1.31 acre portion of Northstar Business Park Lot 1,Block 1 to Scatman Holdings,LLC Reviewed by (Professional Service Bureau, PSB) to facilitate parking lot construction. Action Requested Approve,by resolution, the sale of 1.31 acres (Parcel A) of Lot 1,Block 1, Northstar Business Park to Scatman Holdings,LLC, for$114,127.20. Background/Discussion Scatman Holdings,LLC is the property ownership arm of Professional Service Bureau (PSB), a rapidly- expanding telecommunication business located in the Elk River Industrial Park. Their employee growth has exceeded the number of parking spaces at their office, requiring on street parking on the adjacent streets, and impacting area businesses. Over the past year, staff and PSB have been working on a longer-term solution: PSB is proposing to purchase 1.31 acres of lot 1,block 1, Northstar Business Park, to construct an approximately 100-space parking lot. This parcel and parking lot will be attached to the building already owned by PSB. PSB is not requesting financial assistance for this sale or improvements. Market value of the property is $2.00 per square foot. This sale represents the third step of a many step process, outlined below,with approving agency in parentheses: • Quit Claim Northstar Business Park L1, B1 to EDA, to maintain consistency* (City Council) • Split Lot 1,Block 1 Northstar Business Park (City Council) • EDA sell parcel A to buyer (EDA) • Connect parcel A to PSB lot (Staff,via the County) • Approve parking lot plans (staff) • Begin construction (PSB) *It appears that both City and the EDA own a portion of Lot 1, Block 1, Northstar Business Park. The City Council is expected to convey the property to the EDA later tonight. This will also help logistically with the sale of the balance of Lot 1,Block 1 in the future. Closing is expected in the next two weeks. Financial Impact r o w E R E I R r NATURE $114,127.20 income from the sale. Attachments • Resolution conveying property • Purchase agreement • Survey N•\Departments\Community Development\Economic Development\EDA\Administrative\Agenda\EDA Agenda Packets\Year2014\10-20- 2014\5.2 sr Sale of Parcel A to PSB.docx ( t i of Elk River Resolution 14-07 A Resolution of the Elk River Economic Development Authority Approving Conveyance of Real Property WHEREAS, the Elk River Economic Development Authority ("EDA") desires to convey the property legally described in the purchase agreement between the EDA and Scatman Holdings, LLC ("Buyer") attached hereto as Exhibit A ("Purchase Agreement") for construction of a parking lot to serve Buyer's adjoining property; WHEREAS the EDA finds that the sale of the Property pursuant to the terms of the Purchase Agreement is in the public's interest and furthers the aims and purposes of the EDA; WHEREAS the EDA held a public hearing on October 20, 2014, on the proposed sale of the Property, following published notice of the proposed sale in accordance with Minn. Stat. 169.105; WHEREAS, the City of Elk River currently owns a portion of Lot 1,Block 1,Northstar Business Park, Sherburne County,Minnesota which includes a portion of the property to be conveyed by the EDA under the Purchase Agreement as legally described in Exhibit B ("City Parcel"); WHEREAS, to facilitate the conveyance of the Property and clear title to the Property, the City proposes to convey by quit claim deed to the EDA, the City's interest in Lot 1, Block 1, Northstar Business Park; NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of the City of Elk River that: 1. the EDA does hereby accept the City's conveyance of its interest in Lot 1,Block 1, Northstar Business Park; 2. the EDA approves the Purchase Agreement; 3. the EDA President and Executive Director are authorized to execute all documents necessary,in the opinion of the City Attorney, to effect the sale of the Property pursuant to the terms of the Purchase Agreement. 178723v2 Passed and adopted this 20`h day of October, 2014. Dan Tveite, President ATTEST: Tina Allard, City Clerk 178723v2 EXHIBIT B LEGAL DESCRIPTION PARCEL A: (57,055 SQ.FT) That part of Lot 1, Block 1, NORTHSTAR BUSINESS PARK according to the recorded plat thereof, Sherburne County, Minnesota which lies westerly of the following described line: commencing at the most westerly corner of said lot 1: thence South 20 degrees 27 minutes 03 seconds East, assumed bearing, along the westerly line of said Lot 1 a distance of 218.34 feet to the angle point of said westerly line; thence South 63 degrees 09 minutes 33 seconds East along said westerly line 217.37 feet; thence North 00 degrees 21 minutes 37 seconds East 301.02 feet to a point on the north line of said Lot 1, said point being 272.14 feet east of the most westerly corner of said Lot 1 and said line there terminating. PARCEL B: (528,260 SQ.FT) That part of Lot 1, Block 1, NORTHSTAR BUSINESS PARK according to the recorded plat thereof, Sherburne County, Minnesota which lies easterly of the following described line and its southerly extension: commencing at the most westerly corner of said Lot 1: thence South 20 degrees 27 minutes 03 seconds East, assumed bearing, along the westerly line of said Lot 1 a distance of 218.34 feet to the angle point of said westerly line; thence South 63 degrees 09 minutes 33 seconds East along said westerly line 217.37 feet; thence North 00 degrees 21 minutes 37 seconds East 301.02 feet to a point on the north line of said Lot 1, said point being 272.14 feet east of the most westerly corner of said Lot 1 and said line there terminating. I78723v2 SALE AND PURCHASE AGREEMENT THIS SALE AND PURCHASE AGREEMENT (the "Agreement"), is made as of , 2014 (the "Effective Date" of this Agreement) between the Elk River Economic Development Authority, a public body corporate and politic and a political subdivision of the State of Minnesota (collectively, the "Seller") and Scatman Holdings, LLC, a Minnesota limited liability company, and its assigns (the "Buyer"). In consideration of the mutual covenants and agreements hereinafter contained, the parties agree as follows: 1) SALE AND PURCHASE OF PROPERTY. Seller shall sell to Buyer, and Buyer shall purchase from Seller the property legally described in Exhibit A attached hereto (the "Property"). 2) PURCHASE PRICE AND MANNER OF PAYMENT. The purchase price ("Purchase Price") to be paid by Buyer to Seller shall be One Hundred Fourteen Thousand One Hundred Twenty-Seven and 20/100 Dollars ($114,127.20). The Purchase Price, plus or minus any prorations and other adjustments required hereunder, shall be paid in cash, wire transfer, or guaranteed funds on the Closing Date. 3) CONTINGENCIES. (a) Buyer's Contingencies. The obligations of Buyer under this Agreement are conditioned upon satisfaction or waiver by Buyer of each of the following by the respective dates indicated: (1) Access. Seller shall allow Buyer and Buyer's agents access to the Property without charge and at all reasonable times for the purpose of investigation and testing. Buyer shall pay all costs and expenses of such investigation and testing and shall indemnify, defend and hold Seller and the Property harmless from all costs and liabilities relating to Buyer's activities; provided that Buyer shall not be responsible for existing conditions on the Property nor the cost of investigations or studies completed by Seller before the Effective Date. Buyer shall further repair any damage to the Property caused by or occurring as a result of Buyer's testing. (2) Cooperation. Seller shall, without charge to Buyer, cooperate in Buyer's attempts to obtain all governmental approvals and permits necessary in Buyer's judgment in order to allow the lawful use of the Property for Buyer's intended purposes. (3) Governmental Approvals. Buyer shall have obtained, at its sole cost and expense, all governmental permits, approvals and licenses from all applicable governmental authorities as Buyer deems necessary in its sole discretion for its intended development, construction and use of the Property. (4) Lot Split. Prior to the Closing Date, Seller shall complete, at Seller's sole cost and expense, a lot split by administrative subdivision to split Seller's existing parcel of property legally described as Lot 1, Block 1, Northstar Business Park, Sherburne County, 178525v7 Minnesota into two separate parcels. Following the lot split, the Property shall be a separate parcel consisting of approximately 1.31 acres. (5) Use. Buyer shall have received all necessary approvals allowing Buyer to use and park vehicles on the Property effective as of the Closing Date. (6) Title. Title shall have been found acceptable by Buyer in its sole discretion, or been made acceptable, in accordance with the requirements and terms of Section 4 below. (7) Financing. Buyer shall have obtained financing for the purchase of the Property on terms satisfactory to Buyer in Buyer's sole discretion. (8) Representations and Warranties. The representations and warranties of Seller contained in this Agreement will be true now and on the Closing Date as if made on the Closing Date. If any condition set forth in this Section 3 has not been satisfied or waived on or before the Closing Date (the "Inspection Deadline"), then Buyer may, at Buyer's option, terminate this Agreement. Upon such termination, neither Seller nor Buyer shall have any further rights or obligations under this Agreement except for the covenants made in Section 8 and Section 9 (the "Surviving Covenants"). If Buyer has not terminated this Agreement on or before the Inspection Deadline, then Buyer shall be deemed to have waived the contingencies set forth herein. (b) Seller's Contingencies. The obligations of Seller under this Agreement are conditioned upon satisfaction or waiver by Seller of each of the following by the respective dates indicated: (1) Buyer acknowledges that Seller is not the sole owner of the Property and that Seller's duties hereunder and Buyer's rights hereunder are both expressly contingent upon the acquisition by Seller of all rights in the Property. In the event Seller does not • acquire sole title to the Property on or before the Closing, this Agreement shall terminate, and thereafter neither party shall have any further obligations hereunder. (2) At Closing, Buyer providing a formal written request to Sherburne County to combine as a single tax parcel the Property with Buyer's abutting property having a parcel identification number of 75-659-0121. If any condition set forth in this Section 3 has not been satisfied or waived on or before the Inspection Deadline, then Seller may, at Seller's option, terminate this Agreement. Upon such termination, neither Seller nor Buyer shall have any further rights or obligations under this Agreement except for the Surviving Covenants. 2 178525v7 4) TITLE MATTERS. (a) Deed. Seller shall deliver to Buyer, or cause to be delivered to Buyer, at Closing, an executed Warranty Deed ("Deed") in recordable form conveying fee simple title to the Property subject to the terms of this Agreement and: (1) Reservations of minerals or mineral rights by the State of Minnesota; (2) Building, zoning and subdivision laws and regulations; (3) The lien of real estate taxes and installments of special assessments which are payable by Buyerpursuant to the terms of this Agreement; (4) Applicable laws, regulations, zoning regulations and ordinances, whether federal, state or local; (5) Exceptions to title which constitute encumbrances, restrictions, or easements which have been disclosed to Buyer and accepted by Buyer in writing; and (6) The requirements relating to construction of the Minimum Improvements and the right of reverter provided under Section 10 of this Agreement. (hereinafter"Permitted Encumbrances"). (b) Title Evidence. Buyer may obtain the following title evidence from Seller (collectively, the "Title Evidence"): (i) Title Insurance Commitment. A commitment ("Title Commitment") from such title company selected by Buyer (the "Title Company") for an ALTA Form B 2006 Owner's Policy of Title Insurance committing to insure a marketable title to the Property in Buyer; deleting so-called "standard exceptions" related to survey matters, parties in possession, and liens for labor, materials and services; including affirmative insurance regarding appurtenant easements, separate real estate taxation, and contiguity, in the amount of the Purchase Price, and issued by the Title Company. The cost of the Title Commitment shall be paid by the Seller. The Title Commitment shall include complete and accurate copies of all matters described in Schedule B thereof; and (ii) Survey. A current survey of the Property, certified to Seller, Buyer, Title Company and Buyer's lender, prepared in accordance with ALTA/ACSM standards and such other requirements as requested by Buyer or Buyer's lender (the "Survey"). (c) Buyer's Objections. Within fifteen (15) days after receiving the last item of the Title Evidence, Buyer shall notify Seller of any objections ("Objections") to matters disclosed in the Title Evidence. Buyer shall be deemed to have automatically made Objections to any mortgage,judgment, tax lien, mechanic's lien and any other monetary lien against the Property 3 178525v7 (collectively "Monetary Liens"). With respect to any update to the Title Commitment and/or the Survey, Buyer shall have 10 days after Buyer's receipt of the applicable updated Title Commitment and/or Survey to notify Seller of any Objections; provided that Buyer shall not have the right to object to any matters that were shown on a previous Title Commitment and/or Survey and not timely objected to by Buyer. Seller shall use reasonable efforts to correct any Objections which shall include, if applicable, payment of the Monetary Liens out of proceeds from Closing on the Closing Date if they are not satisfied prior thereto. At Closing, Buyer shall have the right to require endorsement(s)to the Title Policy, at Buyer's cost. If the Objections are not cured prior to the Closing Date, Buyer will have the option to do any of the following by notice provided to Seller: (i) Terminate. Terminate this Agreement pursuant to Section 3 herein, on or before the Closing Date. Upon such termination, neither Seller nor Buyer shall have any further rights or obligations under this Agreement, except for the Surviving Covenants; or (ii) Waive. Waive the Objections and close the transaction contemplated by this Agreement as if such Objections had not been made. (d) Title Policy. If the Closing occurs, Title Company shall issue an owner's title insurance policy ("Title Policy") pursuant to the Title Commitment, or a suitable mark up of the Title Commitment initiated by the Title Company undertaking to issue such a Title Policy within a reasonable time in the form required by the Title Commitment as approved by Buyer. 5) CLOSING PROCEDURES. (a) Closing Date. The closing of the purchase and sale contemplated by this Agreement (the "Closing") shall occur on or before November 7, 2014, or such later date as mutually agreed to by the Buyer and Seller (the "Closing Date"). If Closing does not occur on or before June 1, 2015, this Agreement shall be null and void, Buyer shall execute a quit claim deed for the Property in favor of Seller, and neither party shall have any further obligations hereunder. The parties will submit all closing documents to the Title Company in escrow and will not attend the Closing in person. (b) Seller's Closing Documents. On the Closing Date, Seller shall execute and/or deliver to Buyer the following(collectively,the "Seller's Closing Documents"): (i) Deed. A Warranty Deed (the "Deed"), in recordable form, conveying marketable title to the Property to Buyer, free and clear of all encumbrances, other than those encumbrances not objected to or waived pursuant to Section 4; (ii) Seller's Affidavit. An Affidavit by Seller indicating that on the Closing Date there are no outstanding, unsatisfied judgments, tax liens, or bankruptcies against or involving Seller or the 1 Property; that there has been no skill, labor, or material furnished to the Property for which payment has not been made or for which mechanics' liens could be filed; and there are no other unrecorded interests 4 178525v7 in the Property, together with whatever standard owner's affidavit as may be required by the Title Company to issue the Title Policy; (iii) FIRPTA Affidavit. A nonforeign affidavit, properly executed and in recordable form, containing such information as is required by IRC Section 1445(b)(2) and its regulations; (iv) Original Documents. Seller shall deliver to Buyer all original Documents (or suitable copies thereof) that may be necessary for Buyer to develop and operate the Property; and (v) Other Documents. All other documents reasonably determined by Buyer or the Title Company to be necessary to transfer the Property to Buyer. (c) Buyer's Closing Documents. On the Closing Date, Buyer will execute and/or deliver to Seller the following (collectively, "Buyer's Closing Documents"): (i) Purchase Price. The Purchase Price to be paid as required by Section 2 hereof; (ii) Lot Combination Letter. The Letter request for combination as required by Section 3 hereof; (iii) Title Documents. Such affidavits of Buyer or other documents as may be reasonably required by the Title Company in order to record Seller's Closing Documents and issue the Title Policy. 6) PRORATIONS. Seller and Buyer shall make the following prorations and allocations at the Closing: (a) Title Insurance and Closing Fee. Seller shall pay the cost of the Title Evidence for the Title Policy. Buyer shall pay the cost for endorsements to the title commitment and the premium for title insurance, if Buyer desires a title policy be issued. Seller and Buyer will each pay one-half of any reasonable and customary closing fee or charge imposed by the Title Company or its designated closing agent. (b) Deed Tax. Seller shall pay all state deed tax due on the Deed to be delivered by Seller under this Agreement. (c) Real Estate Taxes and Special Assessments. Seller shall pay or cause to be paid all general real estate taxes payable for the Property in the years prior to the year in which the Closing occurs, and any deferred or Green Acres real estate taxes. Seller and Buyer shall prorate the general real estate taxes payable for the Property in the year of closing as of the Closing Date based upon the calendar year. Seller shall pay, on or before the Closing Date, all special assessments levied, "pending," deferred or constituting a lien against the Property as of the Closing Date, including, without limitation, all installments of special assessments, including interest, payable in the year of Closing. In addition, Seller shall pay all special assessments which may be caused by the development of the 5 178525v7 (d) Property. Nothing in this subparagraph shall be deemed a waiver of the City's ability to lawfully impose future special assessments on the Property as well as any assessments that may be agreed to by Buyer as part of the development of the Property. Buyer shall be responsible for any sanitary area charges, water area charges, water quality and other established City fees associated with its development of the Property. (e) Recording Costs. Seller will pay the cost of recording all documents necessary to place record title in Seller in the condition warranted by Seller in this Agreement. Buyer will pay the cost of recording all other documents. (f) Attorneys' Fees. Seller and Buyer shall each pay its own attorneys' fees in connection with the preparation and negotiation of this Agreement and the Closing, except that a party defaulting under this Agreement or any of its respective Closing Documents shall pay the reasonable attorneys' fees and court costs incurred by the nondefaulting party to enforce its rights regarding such default. 7) OPERATION PRIOR TO CLOSING. During the period from the Effective Date through the Closing Date (the "Executory Period"), Seller shall not execute any contracts, leases, or other agreements regarding the Property, nor perform any act that would impair or encumber the title to the Property or affect the condition of the Property. 8) REPRESENTATIONS, WARRANTIES BY SELLER. Seller represents and warrants to Buyer as follows, which representations and warranties shall be true and correct as of the Closing: (a) Organization; Authority. Seller has the requisite power and authority to execute and perform this Agreement and any Seller's Closing Documents to be signed by it; such documents have been (or will be prior to Closing) duly authorized by all necessary action on the part of Seller and at the Closing shall have been duly executed and delivered; such execution, delivery, and performance by Seller of such documents does not conflict with or result in a violation of any judgment, order, or decree of any court or arbiter to which Seller is a party, or any agreement by which Seller is bound; and such documents are and shall be valid and binding obligations of Seller, enforceable in accordance with their terms. (b) Title to Property. At Closing, Seller will own the Property and will obtain good marketable title, free and clear of all encumbrances, except those encumbrances listed in the Title Commitment. (c) Mechanic's Liens. All labor and materials which have been provided to the Property have been fully paid for or will be fully paid for, prior to the Closing Date. (d) Rights of Others to Purchase Property. Seller has not entered into any other contracts, agreements or understandings, whether oral or written, for the sale of all or any portion of the Property, and there are no existing rights of first refusal or options to purchase all or any portion of the Property, or any other rights of others that might prevent the consummation of this Agreement. 6 178525v7 (e) Storage Tanks. There are no above-ground or underground tanks are located in or about the Property. (f) Wells and Septic. Seller knows of no wells on the Property. At the time of Closing, Seller will deliver any required well certificate pursuant to applicable laws. There is no "individual sewage treatment system" within the meaning of Minn. Stat. Section 115.55 on or serving the Property. Sewage generated at the Property goes to a facility permitted by the Minnesota Pollution Control Agency. (g) Assessments. Seller has not received any notice of any actual or proposed special assessments or reassessments of the Property. (h) Litigation and Other Matters. Seller has received no notice, and has no knowledge of any pending notice, of a violation of any statutes, ordinances, regulations, judicial decrees, or orders, or the pendency of any lawsuits, administrative or arbitration hearings, governmental investigations, proceedings, applications, petitioners, or other matters affecting the Property or the use thereof. (i) Condemnation. Seller has not received any notice of any pending condemnation, eminent domain or other similar action, suit or proceeding that would affect the Property. (j) Hazardous Substances. To the best of Seller's knowledge there are no Hazardous Substances stored, deposited or located within the property or under the surface of the property. For purposes of this warranty and representation, the term "Hazardous Substances" means asbestos and asbestos-containing materials, polychlorinated biphenyls, nuclear fuel or materials, chemical waste, radioactive materials, explosives, known carcinogens, petroleum products, or other dangerous, toxic, or hazardous pollutant, contaminant, chemical, material or substance defined as hazardous or as a pollutant or contaminant in, or the release or disposal of which is regulated by, any Environmental Laws. For purposes of this Agreement, the term "Environmental Laws" shall mean the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C. §§ 9601-9657, as amended, and any other federal, state and local laws, rules and regulations dealing with Hazardous Substances, the environment or public health. (k) FIRPTA. Seller is not a "foreign person," "foreign partnership," "foreign trust" or "foreign estate," as those terms are defined in Section 1445 of the Internal Revenue Code. Except for the warranties, covenants and representations explicitly set forth in this Agreement, Seller and Buyer agree that Buyer will accept possession of the Property in its AS-IS condition, WITH ALL FAULTS, and the sale of the Property to Buyer shall be without any other representation, covenant or warranty of any kind, express or implied, and Buyer, for Buyer, Buyer's agents, attorneys, representatives, heirs and assigns does hereby disclaim and renounce any other representation or warranty. 7 178525v7 The representations and warranties in this Section 8 shall survive the Closing for a period of 2 years. 9) REPRESENTATIONS, WARRANTIES AND INDEMNITY BY BUYER. Buyer represents and warrants to Seller as follows, which representations and warranties shall be true and correct as of the Closing: (a) Buyer has the power and authority to execute this Agreement and any Buyer's Closing Documents signed by it; that all such documents have been authorized by all necessary action on the part of Buyer and at the Closing shall have been duly executed and delivered; that the execution, delivery, and performance by Buyer of such documents does not conflict with or violate any judgment, order or decree of any court or arbiter or any agreement by which Buyer is bound; and that all such documents are valid and binding obligations of Buyer and are enforceable in accordance with their terms. (b) Buyer owns, or at Closing will own, the property located at 11110 Industrial Circle NW, Elk River, MN with a tax identification number of 75-659-0121, which property abuts the Property. (c) Buyer will not transfer title to the Property within one year of Closing without the consent of the Seller. The representations and warranties in this Section 9 shall survive the Closing for a period of 2 years. 10) ADDITIONAL PROVISIONS. (a) In the event that subsequent to the execution and delivery of the Warranty Deed the Buyer shall fail to complete construction of a paved parking lot for a minimum of 100 parking spaces in conformity with a site plan approved by the City ("Minimum Improvements") and obtain a Certificate of Completion within one year of the Date of Closing, and such failure shall not be cured within thirty (30) days after written notice to do so, or within a reasonable amount of time thereafter, then the Seller shall have the right to immediately re-enter and take possession of the Property and to terminate (and revest in the Seller)the estate conveyed by the Warranty Deed to the Buyer. The conveyance of the Property to the Buyer shall be made upon, and the Warranty Deed shall contain a condition subsequent to the effect that in the event of any default on the part of the Buyer and failure on the part of the Buyer to remedy, end, or abrogate such default within the period and in the manner stated herein, the Seller, at its option, may declare a termination in favor of the Seller of the title, and all of the rights and interests in and to the Property conveyed to the Buyer, and that such title and all rights and interests of the Buyer, and any assigns or successors in interest to and in the Property, shall revert to the Seller. 11) CONDEMNATION. If, prior to the Closing Date, any governmental entity commences any eminent domain proceedings ("Proceedings") against all or any part of the Property, Seller shall give notice to Buyer of such fact, and, at Buyer's option (to be exercised by notice to Seller within thirty (30) days after Seller's notice), this Agreement shall terminate. Upon such termination, neither Seller nor Buyer shall have any further rights or obligations under this 8 178525v7 Agreement, except for the Surviving Covenants. If Buyer does not give such notice, then there shall be no reduction in the Purchase Price, provided, however, that Seller shall assign to Buyer at the Closing Date all of Seller's right, title, and interest in and to any award made or to be made in the Proceedings. Prior to the Closing Date, Seller shall not designate counsel, appear in, or otherwise act with respect to the Proceedings without Buyer's prior written consent. 12) ASSIGNMENT. Buyer reserves the right, at Buyer's sole discretion, to assign all or part of its interest in and to this Agreement to an affiliate of Buyer. Notwithstanding the foregoing, neither Seller nor Buyer may assign its rights under this Agreement for any other purpose, without the prior written consent of the other party. 13) SURVIVAL. All of the covenants, representations and warranties made in this Agreement which either by their terms expressly survive Closing, or are contained in any schedule, exhibit, certificate, or document delivered at Closing, will survive and be enforceable after the Closing. 14) NOTICES. Any notice required or permitted to be given under any provision of this Agreement shall be in writing and shall be deemed to have been given in accordance with this Agreement, if it is mailed, by United States certified mail, return receipt requested, postage prepaid; or if deposited cost paid with a nationally recognized, reputable overnight courier, properly addressed as follows: If to Seller: City of Elk River 13065 Orono Parkway Elk River, MN 55330 If to Buyer: Scatman Holdings LLC Attn: Rob Gibbs 11110 Industrial Circle NW, Suite B Elk River, MN 55330 with a copy to: Larkin, Hoffman, Daly & Lindgren, Ltd. 1500 Wells Fargo Plaza 7900 Xerxes Avenue South Minneapolis, Minnesota 55431 Attention: Peter J. Coyle Notice shall be effective, and the time for response to any notice by the other party shall commence to run, one (1) business day after any such mailing or deposit. Either Seller or Buyer may change its address for the service of notice by giving notice of such change to the other party, in any manner above specified, ten (10) days prior to the effective date of such change. Notwithstanding the foregoing, any party may give any other party written notice hereunder by any means other than by United States registered or certified mail or overnight courier, which is reasonably calculated to reach the other party, including but not limited to hand delivery, email transmission or facsimile transmission, provided that any such notice shall be deemed to have been given and shall be effective only when actually received by the addressee, proof of which shall be furnished by the party sending such notice 9 178525v7 15) CAPTIONS; EXHIBITS. The section and paragraph headings or captions appearing in this Agreement are for convenience only, are not a part of this Agreement, and are not to be considered in interpreting this Agreement. All schedules, exhibits, addenda or attachments referred to herein are hereby incorporated in and constitute a part of this Agreement. 16) ENTIRE AGREEMENT; MODIFICATION. This written Agreement constitutes the complete agreement between Seller and Buyer and supersedes any prior oral or written agreements between them regarding the Property. There are no oral agreements that change this Agreement, and no amendment of any of its terms will be effective unless in writing and executed by both Seller and Buyer. 17) BINDING EFFECT. This Agreement binds and benefits Seller and Buyer and their respective successors and assigns. 18) CONTROLLING LAW. This Agreement has been made under, and will be interpreted and controlled by, the laws of the State of Minnesota. 19) WAIVER. No waiver of the provisions of this Agreement shall be effective unless in writing, executed by the party to be charged with such waiver. No waiver shall be deemed a continuing waiver or waiver in respect of any subsequent breach or default, either of similar or different nature, unless expressly stated in writing. 20) COUNTERPARTS. This Agreement may be executed in any number of counterparts and each such counterpart shall be deemed to be an original instrument, but all such counterparts together shall constitute but one Agreement. 21) FACSIMILE SIGNATURES. This Agreement may be executed with signatures transmitted by facsimile or email and shall constitute a binding agreement with such signatures. Nonetheless, any party providing facsimile or emailed signatures shall provide the other party with the original signatures within five (5) business days after providing the facsimile signature page(s). 22) SEVERABILITY. If any provision of this Agreement is invalid or unenforceable, such provision shall be deemed to be modified to be within the limits of enforceability or validity, if feasible; however, if the offending provision cannot be so modified, it shall be stricken and all other provisions of this Agreement in all other respects shall remain valid and enforceable. 23) LIMITATION OF LIABILITY. Upon Closing, Buyer shall neither assume nor undertake to pay, satisfy or discharge any liabilities, obligations or commitments of any Seller other than those specifically agreed to between the parties and set forth in this Agreement. 24) REMEDIES. Time is of the essence of this Agreement. If Seller fails to perform any of its obligations under this Agreement, Buyer's sole remedy is to terminate this Agreement. If Buyer defaults in performance of its obligations under this Agreement, Seller shall have the right to terminate this Agreement in the manner provided by Minn. Stat. Sec. 559.21. Such termination of this Agreement will be the only remedy available to Seller for such default by Buyer, and Buyer will not be liable for damages or specific performance. 10 178525v7 Seller and Buyer have executed this Agreement as of the date set forth above. BUYER: Scatman Holdings, LLC By: Its: SELLER: Elk River Economic Development Authority By: Its: By: Its: 12 178525v7 Exhibit A Legal Description of Property That part of Lot 1, Block 1, NORTHSTAR BUSINESS PARK according to the recorded plat thereof, Sherburne County, Minnesota which lies westerly of the following described line: commencing at the most westerly corner of said Lot 1: thence South 20 degrees 27 minutes 03 seconds East, assumed bearing, along the westerly line of said Lot 1 a distance of 218.34 feet to the angle point of said westerly line; thence South 63 degrees 09 minutes 33 seconds East along said westerly line 217.37 feet; thence North 00 degrees 21 minutes 37 seconds East 301.02 feet to a point on the north line of said Lot 1, said point being 272.14 feet east of the most westerly corner of said Lot 1 and said line there terminating. The Property being purchased consists of approximately 1.31 acres. 13 178525v7 . r ADMINSTRATIVE LOT SPLIT FOR N *1 KINGHORN CONSTRUCTION s .- -1 L .rr I -- r t 4N 11 \ ■ • 2 \ \ & PARCEL A \ PARCEL B Y w ■■ \ \ 2 ...,. _. w o \F\ _ _\ '\ P lO\\ O. � •\ Nbg ' ' \ a 3.•Y e - \\ \ d q \ 0..54557W 22121 ., \ \ \ • hF ' -_� \ \\\\ \\\ ; ;.;4�� / ���V //y • \\ / PROPOSED LEGAL DESCRIPTIONS \ _ / Z?r If __ EVSTIN4 LE(a RL DESCRIPTION ,` I --_________ L. I,Blood.1...TE3S'I.AR BI SINESS PARK I __ __• i ■ m,e.,,n.l.,.,,,.m'r.,....,n„a,.,.,,,. PARCEL A 157 055 saw ' Ghat part oft.l Moat 01* 1TAR BUSINESS PARK according to the recorded Pmt thereof \ —— sl 0.5;071- 3•.t'04'E 514 Y snero�me corm .___— --__ County,Minnesota..L t 1 thence South of the following 27 minutes line wmmenang astheed bear,abngtewesterly sarawtl lnwaswm 2odttre ofnm�4 he to the an East. point of.ewest abnBme o South of said Lot 1 amiute distance of nB 3a East on angk enerlyline,hencee loth 0 gees 1 mmmes33eecoMSEast along sale westerly hoe 21]3]feet,Menu North 00 degrees 31 minutes 37 seconds East 30102 met to a point on the line of said Lot 1,said point being 272 14 feet east of the most westerly Pie only eeeenwi n we foe...]roam se InremWOn corner of said Loth land said line there terminating pow ayclent. I cam,out Ne aten*own or repel was anomie h m4 Wyss w M,a„�°N L°"'d 1Y10 PARCEII I52B,2g0 SN.FEI nparetlay Sun*.2..1,el of That pan of Lot 1,Bl«L1,NORTNSTAR BUSINESS PARK according m the record...thereof �..I WStier.Company Inc , Sherburne COUnry,Minnesota which tin needy of the following described line and rcs M ] s, southerly extension commencing at the most westerly comer of said.dl thence5outh 20 SCALE IN FEET �imuyn.Tl Mau a2a o 3pe0 y /� '224* degrees 27 minutes 03 seconds East,assumed heart.,along lee wesery line of said Lot 1a 4one]d35..13 04Owy G`Repwaaon rY 24th distance ofl11I 34 feet to the angle point of said westerly 174 thence South IT degrees. 0 50 100 150 fax]a 5.-15,2 F seconds es33 s East along said w.f.,/line 217 37 feet,thence NOrth 00 degrees 21 \ / minutes seconds East 30102 feet to a point on the north line of said Lot 1*1,5 point bang 272 14 feet cart of the most westerly corner of sael Lot land said Lee there terminal, �uxyrr.wrar paw spa rAw,on if..o,T J J