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6.1 EDSR 04-15-2024The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity Request for Action To Economic Development Authority Item Number 6.1 Meeting Date April 15, 2024 Prepared By Brent O'Neil, Economic Development Director Item Description Sale of Property at 13530 and 13566 185th Avenue NW (continued from March 18, 2024) Reviewed by: Cal Portner Action Requested Approve, by motion, a resolution authorizing the execution of a purchase agreement for the sale of property at 13530 and 13566 185th Avenue NW to Java Companies. Background/Discussion The EDA has received a purchase offer for the properties known as the Fox Haven site at 13530 and 13566 185th Avenue. Java Companies is proposing to buy the two properties with the primary focus of securing the construction of a neighborhood convenience store and gas station. There would be surplus property remaining for which Java may pursue an additional project such as a small restaurant. The offer is for the full listing price of $360,000 and includes a refundable $20,000 earnest money payment. There is a due diligence period of 120 days, plus a buyer option to extend the period an additional 60 days in which $10,000 in earnest money shall convert to non-refundable. The closing must occur within 30 days of the due diligence period expiring. The agreement calls for a provision to be included in the deed which will require the commencement of construction of the convenience store within one year. Financial Impact Anticipated net proceeds to the EDA of approximately $330,000 upon closing. Mission/Policy/Goal Attract new business development to Elk River to build the City's economic vibrancy, job offerings, and tax base. Attachments 1. Purchase Agreement Fox Haven 2. Resolution Authorizing Sale 3. Site Context 4. JAVA Concept Page 16 of 41 v.2 (Java) EL185\76\937850.v4 PURCHASE AGREEMENT 1. PARTIES. This Purchase Agreement (this “Agreement”) is made on this _____ day of _______________, 2024 (the “Effective Date”), by and between the Elk River Economic Development Authority, a Minnesota body corporate and politic (the “EDA”) and Java Companies LLC, a Minnesota limited liability company and its permitted assigns (the “Buyer”). 2. SALE OF PROPERTY. The EDA agrees to sell to the Buyer and the Buyer agrees to buy from the EDA, the real estate located at 13530 and 13566 185th Avenue NW in the City of Elk River, Sherburne County, Minnesota, legally described on the attached Exhibit A (the “Property”). 3. PURCHASE PRICE AND MANNER OF PAYMENT. The Buyer shall pay the EDA Three Hundred and Sixty Thousand and no/100ths Dollars ($360,000.00) for the Property (the “Purchase Price”). Upon approval and execution of this Agreement by the Buyer and the EDA, the Buyer shall deposit $20,000.00 in initial earnest money (the “Earnest Money”) to be held in escrow by Servion Commercial Title (the “Title Company”). The Earnest Money shall be credited against the Purchase Price at Closing. 4. OBLIGATIONS OF THE EDA. Buyer’s obligation to close the transaction is specifically conditioned upon the following (the “Buyer’s Closing Conditions”): 4.1. Representations and Warranties. The representations and warranties of the EDA contained in this Agreement must be true now and on the Closing Date in all material respects as if made on the Closing Date and the EDA shall have delivered to the Buyer on the Closing Date, a certificate dated the Closing Date, signed by an authorized representative of the EDA, certifying that such representations and warranties are true as of the Closing Date in all material respects (the “Closing Certificate”). 4.2. Title. Title to the Property shall have been found marketable, or been made marketable, in accordance with the requirements and terms of Section 8 below. 4.3. Performance of the EDA’s Obligations. The EDA shall have performed all of the obligations required to be performed by the EDA under this Agreement in all material respects. Included within the obligations of the EDA under this Agreement shall be the following: 4.3.1. The EDA agrees to cooperate with the Buyer as reasonably necessary to permit the Buyer to investigate the Property. 4.3.2. The EDA shall deliver to the Buyer the Title Evidence required in Section 8 10 business days from the Effective Date of this Agreement. 4.3.2 The EDA shall deliver to the Buyer copies of any surveys, plats, civil plans, soils reports, environmental reports (including all investigations performed on the Property in the last five years), and title work relating to the Property which are in the EDA’s possession or control the “Due Diligence Materials” Page 17 of 41 v.2 (Java) EL185\76\937850.v4 2 within 10 days from the Effective Date of this Agreement and the date the EDA delivers all of the Due Diligence Materials to the Buyer is referred to herein as the “Delivery Date”. 5. CONTINGENCIES WHICH MUST BE EXERCISED BY WRITTEN NOTICE TO THE EDA ON OR BEFORE 120 DAYS AFTER THE DELIVERY DATE (THE “INITIAL CONTINGENCY PERIOD”): 5.1. Buyer’s Contingencies. 5.1.1. Inspection and Testing. The Buyer shall have determined, in its sole determination, that the Buyer is satisfied with the results of, and matters disclosed by, any environmental site assessments (including a Phase I and Phase II if necessary), soil tests, surveys, engineering inspections, hazardous substances, and environmental reviews of the Property. The Buyer may enter the Property by providing 24 hours’ notice of its intended entry to the EDA. a. The Buyer shall promptly repair and restore any damage to the Property caused by the Buyer’s testing and return the Property to substantially the same condition as existed prior to entry. Buyer shall have no obligation to repair or remediate any environmental condition discovered or uncovered by Buyer or its agents or contractors. b. The Buyer shall indemnify, defend, and hold the EDA harmless from any claim for damage to person or property arising from any investigation or inspection of the Property conducted by the Buyer, the Buyer’s agents or contractors, including the cost of attorneys’ fees. c. Copies of any written reports, studies or test results obtained by the Buyer in connection with the Buyer’s inspection of the Property or investigation relating to the Property shall be delivered to the EDA promptly upon receipt of the same at no cost to the EDA. The Buyer makes no warranties to EDA regarding the accuracy or completeness of any such tests or test results. d. The Buyer shall be responsible for the costs of all investigation and testing performed by the Buyer with respect to the Property. 5.1.2. Land Use Approvals. The Buyer shall have obtained, at the Buyer’s sole cost and expense, on or before the Contingency Date, all consents, agreements, approvals, easements, licenses, and adequate assurances that are legally necessary for the Buyer to use the Property as intended, including, but not limited to, land use approvals from the City of Elk River or otherwise required by the Buyer, in Buyer’s sole determination. Page 18 of 41 v.2 (Java) EL185\76\937850.v4 3 5.1.3 Financing. The Buyer shall have obtained acceptable financing for the purchase of the Property upon terms and conditions acceptable to Buyer in Buyer’s sole determination. Notwithstanding the foregoing Buyer may elect to extend the Initial Contingency Period for one additional period of sixty (60) by delivering written notice (the “Extension Notice”) to the EDA on or before the last day of the Initial Contingency Period. The Initial Contingency Period and the Additional Period elected by Buyer hereunder are collectively referred to as the “Contingency Period” and the last day of the Contingency Period is referred to herein as the “Contingency Date”. Upon extension of the contingency period, $10,000 of the initial earnest money will become non- refundable. 5.2. EDA’s Contingencies. 5.2.1. Determination by the EDA after a holding a public hearing required by Minnesota Statutes Section 469.105, subdivision 2 that the sale and conveyance of the Property to the Buyer is in the best interests of the City of Elk River and its people, and that the transaction furthers the EDA’s general plan of economic development. If, on or before the Contingency Date, either party determines that any of their respective contingencies listed in this Section have not been satisfied in their sole discretion, then this Agreement may be terminated by written notice from the party to the other, which notice must give no later than the Contingency Date. If the party does not give written notice of termination on or before the Contingency Date, all of such contingencies will be deemed to have been satisfied and the parties shall proceed to close this transaction in accordance with the terms of this Agreement. All of the contingencies set forth in this Agreement are specifically stated and agreed to be for the sole and exclusive benefit of the respective party and each party shall have the right to unilaterally waive any of its contingencies by written notice to the other party. If this Agreement is terminated by either party in accordance with this Section, the Title Company shall disburse the Earnest Money to Buyer and neither party shall have any further rights or obligations regarding this Agreement or the Property. 6. CLOSING. The closing of the purchase and sale contemplated by this Agreement (the “Closing”) shall occur 30 days after the Contingency Date or such other date on which the parties may agree (the “Closing Date”). The EDA agrees to deliver possession of the Property to the Buyer on the Closing Date. 6.1. EDA’s Closing Documents. On the Closing Date, the EDA shall execute and deliver to the Buyer the following (collectively, “EDA’s Closing Documents”), all in form and content reasonably satisfactory to the EDA and the Buyer: 6.1.1. Deed. A quit claim deed (the “Deed”) conveying the Property to the Buyer. The Deed shall contain a covenant running with the Property that the construction of the footings and foundation for an approximately 5,800 square foot gas station/convenience store on the Property must commence within one Page 19 of 41 v.2 (Java) EL185\76\937850.v4 4 year from the date of the Deed, or the Property will be subject to a reversionary interest in favor of the EDA pursuant to Minnesota Statutes Section 469.105, subdivisions 5 and 6. The Buyer may also construct a fast food restaurant on the Property subject to the consent of the EDA, which approval shall not be unreasonably withheld, and receiving any necessary land use approvals. The Deed shall contain provisions for the EDA to execute and record a Certificate of Completion evidencing that the required improvements have been completed. 6.1.2. Seller’s Affidavit. An Affidavit of Title by the EDA stating that on the Closing Date there are no outstanding, unsatisfied judgments, tax liens or bankruptcies against or involving the EDA or the 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 that there are no other unrecorded instruments affecting the Property, together with whatever standard owner’s affidavit (ALTA form) which may be required by the Title Company to issue an Owner’s Policy of Title Insurance with the standard exceptions waived. 6.1.3. Original Documents. Original copies of any surveys, plans and records in the EDA’s possession. 6.1.4. FIRPTA Affidavit. A non-foreign affidavit, properly executed, containing such information as is required by the Internal Revenue Code Section 1445(b)(2) and its regulations. 6.1.5 Closing Certificate. The Closing Certificate. 6.1.6 Seller’s Settlement Statement. A Seller’s Settlement statement reflecting the Purchase Price and the proration of costs and expenses in the manner required by this Agreement. 6.1.7. Other Documents. Any other documents reasonably required or reasonably requested by the Title Company in order to complete the transaction contemplated by this Agreement. 6.2. Buyer’s Closing Documents. On the Closing Date, the Buyer shall execute, as appropriate, and deliver to the EDA the following (collectively, “Buyer’s Closing Documents”): 6.2.1. Purchase Price. The Purchase Price in collected funds (certified or cashier’s check or wire transfer) deposited with the Title Company on the Closing Date. 6.2.2 Buyer’s Settlement Statement. A Buyer’s settlement statement reflecting the Purchase Price and the proration of costs and expenses in the manner required by this Agreement. Page 20 of 41 v.2 (Java) EL185\76\937850.v4 5 6.2.3. Other Documents. Such affidavits of Purchaser, Certificates of Value or other documents may be reasonably required or reasonably requested by the Title Company in order to complete the transaction contemplated by this Agreement. 7. PRORATIONS. The EDA and the Buyer agree to the following prorations and allocation of costs regarding this Agreement: 7.1. Title Insurance and Closing Fees. The EDA shall pay the cost of the title insurance commitment, including any associated title examination and search charges. The Buyer shall pay the cost of any title insurance Buyer elects to purchase or endorsement premiums for such policy. The parties shall share equally the closing fee charged by the Title Company. 7.2. Real Estate Taxes and Special Assessments. The EDA shall pay the state deed tax. The EDA shall also pay, on or before the Closing Date, all special assessments levied, ordered or pending against the Property as of the Closing Date including, without limitation, any installments of special assessments that are payable with general real estate taxes (“Taxes”) in the year in which Closing occurs. The EDA shall pay all Taxes for all of the years prior to the year in which the Closing occurs. Taxes for the year in which the Closing occurs shall be prorated between the parties as of the Closing Date. 7.3. Recording Costs. The EDA shall pay the cost of recording all documents necessary to vest marketable title in the EDA and cure title objections, if any. The Buyer shall pay the cost of recording all other documents, including, but not limited to, the Deed. 7.4. Attorneys’ Fees. Each of the parties shall pay its own attorneys’ fees. 7.5. Brokers’ Fees. The EDA is represented by Ryan Hardin of Hardin Companies (the “EDA’s Broker”). The Buyer is represented by JLL (the “Buyer’s Broker”). Brokerage fees for the EDA’s Broker shall be paid to the EDA’s Broker by the EDA at Closing. These brokerage fees shall be equally split with the Buyer’s Broker. Each party shall indemnify, defend and hold the other party harmless from the claims of any broker hired by that party for fees or commissions. 8. TITLE EXAMINATION. Title examination shall be conducted as follows: 8.1. EDA’s Title Evidence. Within 10 business days of the Effective Date, the EDA shall, at its expense deliver the following (collectively, “Title Evidence”) to the Buyer: 8.1.1. Title Commitment. A title insurance commitment for the Property issued by the Title Company Page 21 of 41 v.2 (Java) EL185\76\937850.v4 6 8.1.2. Survey. The Buyer, at the Buyer’s option, may obtain, at the expense of the Buyer, a survey of the Property. Any survey obtained by the Buyer shall be certified and delivered to the EDA as well as the Buyer and any other parties that the Buyer may designate. 8.2. Buyer’s Objections. No later than 14 days after receiving the updated Title Commitment, the Buyer must make written objections (“Objections”) to the marketability of title to the Property based on the Title Evidence. If the Buyer elects to obtain a survey, Objections based upon the survey must be made within 14 days after receipt of said survey but in no event later than the Contingency Date. The Buyer’s failure to make Objections within such time periods will constitute a waiver of Objections. However, any matter which is not referenced in the title commitment and is first recorded, discovered, or disclosed after the effective date of the title commitment, may be objected to by the Buyer in the manner described herein. If not sooner satisfied, the EDA shall cause the Property to be released from any mortgages or other liens against the Property at the closing. Any matter shown on such Title Evidence, other than a mortgage or other lien and not objected to by the Buyer shall be a “Permitted Encumbrance” hereunder. Within seven days after receipt of the Buyer’s Objections, the EDA shall notify the Buyer in writing if the EDA elects not to cure the Objections. If such notice is given within said seven-day period, the Buyer may either waive the Objections or terminate this Agreement by giving written notice of termination to the EDA within 10 days after the EDA’s notice is given to the Buyer. If written notice by the EDA is not given within the 10-day period, the EDA shall use commercially reasonable efforts to correct any Objections within 30 days after the expiration of the 10-day period (“Cure Period”). If the Objections are not cured within the Cure Period, the Buyer shall have the option to do any of the following: 8.2.1. Terminate this Agreement by giving written notice to the EDA and the Title Company within 10 days after the expiration of the Cure Period and neither the EDA nor the Buyer shall have further rights or obligations hereunder. In such event the Title Company shall immediately disburse the Earnest Money to the Buyer. 8.2.2. Waive the objections and proceed to close without reduction in the Purchase Price. The Buyer shall make the election within 10 days after expiration of the EDA’s Cure Period. A failure to make an election within such period shall be deemed an election to proceed to close pursuant to subsection 8.2.2. 9. REPRESENTATIONS AND WARRANTIES BY THE EDA. The EDA represents and warrants to the Buyer that the following are true in all material respects now and as modified by any changes about which the EDA notifies the Buyer in writing following after the date hereof, will be true in all material respects on the Closing Date: 9.1. Authority. The EDA is a public body corporate and politic, duly created under and subject to the laws of the State of Minnesota; the EDA has the requisite power and Page 22 of 41 v.2 (Java) EL185\76\937850.v4 7 authority to enter into and perform this Agreement and those EDA Closing Documents signed by it; such documents have been or will be duly authorized by all necessary action on the part of the EDA and have been or will be duly executed and delivered; such execution, delivery and performance by the EDA 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 the EDA is a party; such documents are valid and binding obligations of the EDA, and are enforceable in accordance with their terms, subject to bankruptcy, reorganization, insolvency, moratorium and other laws affecting the rights and remedies of creditors generally and principles of equity. 9.2. Rights of Others to Purchase the Property. The EDA has not entered into any other contracts for the sale of the Property, nor are there any rights of first refusal or options to purchase the Property or any other rights of others that might prevent the sale of the Property contemplated by this Agreement. 9.3. Use of the Property. To the best of the EDA’s knowledge without investigation, the Property is usable for its current uses without violating any federal, state, local or other governmental building, zoning, health, safety, platting, subdivision or other law, ordinance or regulation, or any applicable private restriction. 9.4. Proceedings. There is no action, litigation, investigation, condemnation or proceeding of any kind pending or, to the best of the EDA’s knowledge without investigation, threatened against the EDA with respect to the Property or any portion of the Property. 9.5. Wells. No wells exist on the Property. 9.6. Sewage Treatment Systems. No sewage treatment system exists on the Property. 9.7. Title. The EDA owns fee title to the Property. The EDA’s representations shall be true, accurate and complete as of the date of this Agreement, in all material respects and, as modified by any notices given by the EDA to the Buyer, on the Closing Date in all material respects. If any time prior to Closing, the Buyer shall determine that any representation herein made by the EDA was not true in all material respects when made, the Buyer’s sole remedy shall be to terminate this Agreement by giving notice to the EDA and seeking any applicable remedies for breach from the EDA. The earnest money paid by the Buyer shall be returned to the Buyer. Notwithstanding the above paragraph, all representations and warranties shall terminate on the Closing Date. Any claim by the Buyer not made by written notice delivered to the EDA before the date the representation or warranty terminates shall be deemed waived. 10. “AS IS, WHERE IS.” The Buyer acknowledges that the Buyer has inspected or has had the opportunity to inspect the Property and agrees to accept the Property “AS IS” with no right of set off or reduction in the Purchase Price. Such sale shall be without representation of warranties, express or implied, either oral or written, made by the EDA or any official, employee or agent of the EDA Page 23 of 41 v.2 (Java) EL185\76\937850.v4 8 with respect to the physical condition of the Property, including but not limited to, the existence or absence of petroleum, hazardous substances, pollutants or contaminants in, on, or under, or affecting the Property or with respect to the compliance of the Property or its operation with any laws, ordinances, or regulations of any government or other body, except as stated above. The Buyer acknowledges and agrees that the EDA has not made and does not make any representations, warranties, or covenants of any kind or character whatsoever, whether expressed or implied, with respect to warranty of income potential, operating expenses, uses, habitability, tenant ability, or suitability for any purpose, merchantability, or fitness of the Property for a particular purpose, all of which warranties EDA hereby expressly disclaims, except as stated above. The Buyer is relying entirely upon information and knowledge obtained from the Buyer’s own investigation, experience, and knowledge obtained from the Buyer’s own investigation, experience, or personal inspection of the Property. The Buyer expressly assumes, at closing, all environmental and other liabilities with respect to the Property whether such liability is imposed by statute or derived from common law including, but not limited to, liabilities arising under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), the Hazardous and Solid Waste Amendments Act, the Resource Conservation and Recovery Act (“RCRA”), the federal Water Pollution Control Act, the Safe Drinking Water Act, the Toxic Substances Act, the Superfund Amendments and Reauthorization Act, the Toxic Substances Control Act and the Hazardous Materials Transportation Act, all as amended, and all other comparable federal, state or local environmental conservation or protection laws, rules or regulations. The foregoing assumption shall survive Closing. All statements of fact or disclosures, if any, made in this Agreement or in connection with this Agreement, do not constitute warranties or representations of any nature. The foregoing provision shall survive Closing and shall not be deemed merged into any instrument of conveyance delivered at Closing. 11. REPRESENTATIONS AND WARRANTIES BY THE BUYER. The Buyer represents and warrants to the EDA that the Buyer has the requisite capacity, power, and authority to enter into this Agreement and the Buyer’s Closing Documents; such execution, delivery, and performance by the Buyer 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 the Buyer is a party; such documents are valid and binding obligations of the Buyer, and are enforceable in accordance with their terms. 12. CONDEMNATION. If, prior to the Closing, eminent domain proceedings are commenced against all or any material part of the Property, the EDA shall immediately give notice to the Buyer of such fact and at the Buyer’s option (to be exercised within 15 days after the EDA’s notice), this Agreement shall terminate, in which event neither party will have further obligations under this Agreement. Thereupon the Title Company shall disburse the Earnest Money to the Buyer. If the Buyer fails to give such notice, then there shall be no reduction in the Purchase Price, and the EDA shall assign to the Buyer at the Closing all of EDA’s right, title, and interest in and to any award made or to be made in the condemnation proceedings. Prior to the Closing, the EDA shall not designate counsel, appear in, or otherwise act with respect to the condemnation proceedings without the Buyer’s prior written consent. For purposes of this section, the words “a material part” means a part if acquired by a condemning authority would materially hinder Buyer’s operations on the Property. Notwithstanding any other term or condition of this Section 12 to the contrary, the EDA shall not commence nor consent to any eminent domain proceedings affecting all or any part of the Property without the Buyer’s prior written consent, which consent shall not unreasonably be withheld. Page 24 of 41 v.2 (Java) EL185\76\937850.v4 9 13. COMMISSIONS. With the exception of the EDA’s Broker, Hardin Companies and the Buyer’s Broker, JLL, both the Buyer and the EDA represent that they have not entered into a contract with any other real estate broker, whereby the broker is entitled to a commission resulting from the transaction contemplated by this Agreement. Each party agrees to indemnify, defend and hold harmless the other party against any claim made by a real estate broker for a commission or fee based on alleged acts or agreements with the indemnifying party. 14. REMEDIES. 14.1. Buyer’s Remedies. If the EDA fails to satisfy any of the Buyer’s Closing Conditions or fails to otherwise consummate this Agreement for any reason except the Buyer’s default or the termination of this Agreement pursuant to a right to terminate given herein, and such failure continues for longer than ten (10) days after the date Buyer delivers written default hereunder to the EDA (an “EDA Default”) then the Buyer may, at its option, terminate this Agreement by written notice delivered to the EDA and the Title Company, in which event the Title Company shall immediately disburse the Earnest Money to the Buyer and upon such payment, neither party shall be further obligated to the other (except for the Buyer’s and the EDA’s indemnities set forth in this Agreement). The Buyer specifically waives any right to make a claim against the EDA for compensatory or consequential damages or any other type of monetary claim, except for the indemnity obligations set forth in this Agreement. Notwithstanding the forgoing, in lieu of terminating this Agreement the Buyer may also bring an action for specific performance to enforce the terms of this Agreement and if Buyer is successful in such action Buyer shall, in additional to all other relief ordered in such action, be entitled to recover is costs of the action. 14.2. EDA’s Remedy. If the Buyer fails to consummate this Agreement for any reason except the EDA’s default or the termination of this Agreement pursuant to a right to terminate given herein, the EDA’s sole and exclusive remedy shall be to terminate this Agreement by giving 30 days’ written notice to the Buyer, pursuant to Minnesota Statutes Section 559.21, as amended from time to time, in which case, the earnest money shall be retained by the EDA as liquidated damages. 14.3 Indemnification Remedy. Notwithstanding the foregoing provisions of this Section 14, in the event of any default by the Buyer or the EDA under or in connection with any indemnification pursuant to this Agreement, and in the event of any failure by the defaulting party to cure such default within 30 days after the date of notice of default by the non-defaulting party to the defaulting party, the non- defaulting party shall be entitled to seek and recover all legal and equitable relief available under applicable law, including, without limitation, monetary damages. 15. ASSIGNMENT. The Buyer may not assign the Buyer’s rights under this Agreement without prior consent of the EDA, which shall not unreasonably be withheld. Notwithstanding the foregoing, the Buyer may assign this Agreement and the Buyer’s rights hereunder to an entity controlled by or under common control with, the Buyer. Page 25 of 41 v.2 (Java) EL185\76\937850.v4 10 16. SURVIVAL. All of the terms of this Agreement and warranties and representations herein contained shall survive and be enforceable after the Closing. 17. NOTICES. Any notice required or permitted hereunder shall be given by personal delivery; or if deposited cost paid with a nationally recognized, reputable overnight courier; or by certified mail, return receipt requested; properly addressed as follows: If to the EDA: Elk River Economic Development Authority Attn: Executive Director 13065 Orono Parkway Elk River, MN 55330 Attn: Executive Director Or via Email Email: boneil@elkrivermn.gov If to the Buyer: Java Companies LLC Attn: Mark Krogh 879 Scheffer Avenue St. Paul, MN 55102 Or via Email Email: mark@javacompanies.com Notices shall be deemed effective on the earlier of the date of receipt or the date of deposit, as aforesaid; provided, however, that if notice is given by deposit, the time for response to any notice by the other party shall commence to run one business day after any such deposit. Any party may change its address for the service of notice by giving notice of such change 10 days prior to the effective date of such change. 18. CAPTIONS. The 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. 19. ENTIRE AGREEMENT, MODIFICATIONS. This written Agreement constitutes the complete agreement between the parties and supersedes any prior oral or written agreements between the parties regarding the Property. There are no verbal agreements that change this Agreement and no waiver of any of its terms will be effective unless in a writing executed by the parties. 20. BINDING EFFECT. This Agreement binds and benefits the parties and their heirs, successors, and assigns. 21. CONTROLLING LAW. This Agreement has been made under the substantive laws of the State of Minnesota, and such laws shall control its interpretation. Page 26 of 41 v.2 (Java) EL185\76\937850.v4 11 BUYER: JAVA COMPANIES LLC By: _______________________________________ Mark Krogh Its: Chief Manager SELLER: ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY By: _______________________________________ Its: President By: _______________________________________ Its: Executive Director Page 27 of 41 EL185\76\937850.v4 EXHIBIT A Legal Description of the Property Lot 1, Block 1 and Lot 2, Block 1, Fox Haven Commercial, according to the recorded plat thereof, Sherburne County, Minnesota. PIDs 75-00597-0110 and 75-00597-0105 Page 28 of 41 1 EL185-73-872872.v1 THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER, MINNESOTA COUNTY OF SHERBURNE STATE OF MINNESOTA RESOLUTION NO. 24-__ RESOLUTION APPROVING A PURCHASE AGREEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF ELK RIVER AND JAVA COMPANIES LLC., AND APPROVING THE CONVEYANCE OF LAND CONTAINED THEREIN. WHEREAS, The Economic Development Authority of the City of Elk River, Minnesota (the “EDA”) is the fee owner of real property located in Elk River, Sherburne County, Minnesota, (the “City”) and consisting of land containing approximately 3.0 acres legally described in Exhibit A attached hereto and located at 13530 & 13566 185th Avenue NW in the City (the “Real Property”); and WHEREAS, the EDA has reviewed a proposal by Java Companies, LLC, a Minnesota corporation (the “Developer”), to purchase the Real Property from the EDA; and WHEREAS, the EDA and the Developer have negotiated a certain Real Estate Purchase Agreement (the “Purchase Agreement”) in connection with the conveyance of the Real Property; and WHEREAS, on March 18, 2024, and continued on April 15, 2024, the EDA conducted a duly noticed public hearing regarding the sale of the Real Property to Developer, at which all interested persons were given an opportunity to be heard; and WHEREAS, the EDA finds and determines that conveyance by the EDA of the Real Property to the Developer is for a public purpose and is in the best interests of the City and its residents because it will further the objectives of the EDA’s general plan of economic development for the City, will help increase the tax base in the City, and will create new jobs in the City. NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners (“Board”) of The Economic Development Authority of the City of Elk River as follows: 1. The Board approves the Purchase Agreement in substantially the form presented to the Board, including the provisions for the conveyance of the Real Property therein, together with any related documents or certifications necessary in connection therewith, including without limitation all documents and certifications referenced in or attached to the Purchase Agreement, and any deed or other documents necessary to convey the Real Property to Developer, all as described in the Purchase Agreement (collectively, the “Purchase Documents”) and the President and the Executive Director are hereby authorized and directed to execute the Purchase Documents on behalf of the EDA and to carry out, on behalf of the EDA, the EDA’s obligations thereunder when all conditions precedent thereto have been satisfied. 2. EDA staff and officials are authorized to take all actions necessary to perform the EDA’s obligations under the Purchase Documents as a whole, including without limitation execution of any documents or certifications to which the EDA is a party referenced in or attached to the Purchase Page 29 of 41 EL185-73-872872.v1 2 Agreement, and any deed or other documents necessary to convey the Real Property to Developer. 3. The approval hereby given to the Purchase Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the EDA and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the EDA subject to the following conditions: (a) such modifications do not materially adversely affect the interests of the EDA; and (b) such modifications do not contravene or violate any policy of the EDA or applicable provision of law. The execution of any instrument by the appropriate officers of the EDA herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of the officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of the EDA Attorney, may act in their behalf. This Resolution shall not constitute an offer and the purchase agreement shall not be effective until the date of execution thereof. 4. Upon execution and delivery of the Purchase Documents, the officers and employees of the EDA are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the EDA to implement the Purchase Documents. Page 30 of 41 EL185-73-872872.v1 3 Approved by the Board of Commissioners of The Economic Development Authority of the City of Elk River this 15th day of April, 2024. President ATTEST: Executive Director Page 31 of 41 A-1 EL185-73-872872.v1 EXHIBIT A LEGAL DESCRIPTION OF THE REAL PROPERTY Lot 1 and Lot 2, Block 1, Fox Haven Commercial, according to the recorded plat thereof, County of Sherburne, State of Minnesota. PID No: 75-00579-0105 75-00597-0110 Page 32 of 41 Page 33 of 41 JAVA Concept – Fox Haven Site Feb 2024 Page 34 of 41 Page 35 of 41