PHASE II OPTION AGREEMENT
(2001 Xxxxxxx Option)
THIS AGREEMENT, made and entered into this 10th day of February, 1999, by
and between Hillcrest Development, a Minnesota limited partnership hereinafter
called "Owner," and R&D Systems, Inc., a Minnesota corporation, or its only
permitted assignee, Techne Corporation, hereinafter called "Buyer";
WITNESSETH:
WHEREAS, Owner is a purchaser under a purchase agreement dated August 14,
1998 ("Phase II Purchase Agreement") to purchase the fee simple title to the
real property improved with a building commonly known as 2001 Xxxxxxx and is the
current fee simple owner of real property to be used for a surface parking lot
commonly known as the "2020 Broadway Lot," all of which are located in the City
of Minneapolis, County of Hennepin, State of Minnesota, and legally described in
Exhibit A hereto attached ("Parcels"); and
WHEREAS, Buyer and Seller have prior to the execution of this Option
Agreement entered into a Purchase Agreement for the purchase and sale of real
property which includes properties commonly known as 614 XxXxxxxx, 640 XxXxxxxx
and 2201 Xxxxxxx ("Purchase Agreement") and simultaneously with the execution of
this Option Agreement entered into an additional option agreement with respect
to 2101 Xxxxxxx and 659 Cleveland and certain real property to be used for
parking purposes ("2101 Xxxxxxx Option"); and
WHEREAS, Buyer desires to obtain an option to purchase the Parcels, all
personal property items owned by Owner and exclusively used by Owner in the
maintenance and operation of the Parcels and chosen to be purchased by Buyer
("Personal Property"), all guarantees and warranties in effect regarding
improvements to the Parcels ("Warranties") and all contracts and permits
affecting the Parcels selected by Buyer ("Contracts") (hereafter the Parcels,
Personal Property, Warranties, and Contracts are collectively referred to as the
"Property"); and
WHEREAS, Owner is willing to grant such an option on the terms and
provisions hereinafter contained.
NOW, THEREFORE, in consideration of One Thousand and no/100 Dollars
($1,000.00) and other good and valuable consideration herewith paid by Buyer to
Owner, the receipt and sufficiency of which is hereby acknowledged by Owner, and
in further consideration of the mutual covenants and agreements herein
contained, it is agreed by and between the parties hereto as follows:
1. Option. Owner hereby grants to Buyer, for the period beginning on
December 1, 1999 and ending at 11:59 o'clock p.m., on January 1, 2005 (the
"Option Termination Date"), the exclusive right and option to purchase the
Property upon the terms and conditions herein contained.
2. Exercise of Option. The option herein granted shall be deemed fully
exercised as to the Property if (i) prior to the earlier of (x) January 15, 2002
or (y) sixty (60) days after the date Buyer exercises its option under the 2101
Xxxxxxx Option, the Option Fee, as hereafter defined, is paid to Title, as
defined in the Purchase Agreement attached hereto as Exhibit B ("Exhibit B
Purchase Agreement"), as Escrow Agent for both parties; and (ii) the Buyer gives
to the Owner, before the Option Termination Date, a written notice of election
to purchase the Property. Service of such notice shall be sufficient if served
personally or if timely deposited in the United States mail addressed to Owner
as hereinafter provided and received by Owner on or prior to the Option
Termination Date. Failure to timely provide such notice or timely pay the
Option Fee to Title shall automatically terminate the option herein granted to
Buyer and Title shall remit the Option Fee in its possession to Owner and any
accrued interest thereon to Buyer. Upon receipt by Title of the Option Fee and
the receipt by Owner of the notice, the parties shall execute the Exhibit B
Purchase Agreement. The Option Fee shall consist of nonrefundable cash except
as hereinafter provided, in the amount of $1,999,000.00. Notwithstanding the
foregoing or any other provision of this Option Agreement to the contrary,
the option granted hereunder shall not be exercisable and shall be deemed null
and void in the event (i) Buyer or Techne Corporation has not yet acquired
from Owner the real property covered by the Purchase Agreement, (ii) in the
event Buyer or Techne Corporation fails to pay Owner the Option Fee and/or
fails to close its purchase of 2101 Xxxxxxx pursuant to the 2101 Xxxxxxx
Option prior to the actual exercise of the option herein granted to Buyer, or
(iii) if Owner fails to acquire fee simple title to 2001 Xxxxxxx pursuant to
the Phase II Purchase Agreement by November 30, 1999. Upon execution of the
Exhibit B Purchase Agreement by both parties, the Option Fee shall be deemed
the "Deposit" as defined in the Exhibit B Purchase Agreement. Notwithstanding
the foregoing or any other provision of this Option Agreement, if Buyer
terminates its rights to purchase 2101 Xxxxxxx pursuant to Exhibit B to the
2101 Xxxxxxx Option and is entitled to a refund of one hundred percent (100%)
of the Deposit pursuant to Section III(c) therein, then in such event Title
shall return to Buyer the Option Fee paid hereunder and this Option Agreement
shall be deemed null and void except for the indemnification of Buyer
contained in paragraph 5 of this Option Agreement.
3. Purchase Price. The purchase price for the Property shall be Seven
Million and 00/100ths Dollars ($7,000,000.00) payable in cash to Owner at the
closing plus the "Capital Improvement Cost" as defined in the Exhibit B Purchase
Agreement. Buyer shall receive at closing as a credit against the purchase
price for the Option Fee and the $1,000.00 previously paid. The purchase price
shall be allocated between the following portions of the Property upon execution
of the Exhibit B Purchase Agreement: $___________________ to 2001 Xxxxxxx and
$________________ to 0000 Xxxxxxxx Lot.
4. Representations and Warranties by Owner. Owner represents and
warrants to Buyer:
(a) If Buyer duly exercises the option herein granted, Owner shall,
subject to performance by Buyer of the covenants and agreements to be
performed by it under the Exhibit B Purchase Agreement, execute and
deliver to Buyer, at closing, as defined in the Exhibit B Purchase
Agreement, a warranty deed ("Deed") conveying good and marketable
title to the Property subject only to the exceptions ("Permitted
Encumbrances") noted on Exhibit C hereto attached. Owner will not
place of record or cause to be incurred any additional liens or
encumbrances against the Property until the Memorandum, as hereafter
defined, is placed of record provided that such Memorandum is
recorded within thirty (30) days of its date of execution.
(b) To the extent commercially reasonable after any condemnation and/or
casualty, Owner will upon its acquisition of Title to the Property
operate, maintain and repair the Property in a commercially
reasonable fashion.
(c) Upon Owner's acquisition of Title to the Property, Owner will
maintain casualty insurance for at least $9,000,000.00 on the 2001
Xxxxxxx Building to the extent it can be economically purchased. It
is assumed that any aggregate increases of less than one hundred
percent (100%) of the current cost shall be economical.
(d) Upon Owner's acquisition of Title to the Property, Owner will not
thereafter knowingly lease the Property to tenants who engage in the
business of the generation and/or storage of hazardous materials but
the foregoing shall be breached if any tenant, without Owner's
consent or knowledge, engages in such activities. Owner will take
appropriate action to terminate the rights of any tenant who violates
such prohibition.
(e) Upon Owner's acquisition of title to the Property, Owner will have
marketable and insurable record title to the Property as of closing,
subject only to the Permitted Encumbrances.
(f) To the best of Owner's knowledge, the information supplied to Buyer
with respect to the Property including copies of leases, materials
described in Exhibit C to the Purchase Agreement but excluding the
materials described in Exhibit D to the Purchase Agreement is complete
and materially correct.
(g) At closing, Owner shall assign to the extent they are assignable, all
of Owner's interest in the "Other Agreements" and "Leases" as defined
in the Exhibit B Purchase Agreement.
(h) Owner has not received any notice nor are they aware of any pending or
threatened action to take by eminent domain or by deed in lieu thereof
all or any portion of the Property.
(i) Owner shall be solely responsible for and shall pay on the date of
closing any deferred tax or assessment, including, but not limited to,
those referred to in Minnesota Statutes Section 273.11 (the so-called
"Green Acres recapture"), catch-up or adjustment in future taxes due
as a result of the Property having been classified under any
designation authorized by law to obtain a special low ad valorem tax
rate or receive either an abatement or deferment of ad valorem taxes.
(j) Owner is not a "foreign person" as contemplated by Section 1445 of the
Internal Revenue Code, and that at the closing Owner will deliver to
Buyer a certificate so stating, in a form complying with the Federal
tax law.
(k) This Option Agreement has been duly and validly authorized, executed
and delivered by Owner and the obligations of Owner hereunder and
thereunder are valid and legally binding, and this Option Agreement
upon Owner's acquisition of title to the Property is enforceable
against Owner in accordance with its terms.
(l) Except as shown by the materials described in Exhibit C and Exhibit D
of the Purchase Agreement, except for acts of Buyer as possible tenant
of the Property and the use by Buyer of hazardous materials, except for
asbestos used as a building material for the Property and except for a
fuel oil tank located at the south end of 2001 Xxxxxxx, to the best of
Owner's knowledge, Owner has not generated, manufactured, buried,
spilled, leaked, discharged, emitted, stored, disposed of, used or
released any Hazardous Substance (as hereafter defined) about the
Property, except as may have occurred as a result of operating the
Property and in any such event such activities were at all times in
compliance with Environmental Laws as hereinafter defined and has not
knowingly permitted any other party to do any of the same. Except for
and to the extent of the matters specifically described in Exhibit C
and Exhibit D of the Purchase Agreement, except for acts of Buyer as
possible tenant of the Property and the use by Buyer of hazardous
materials, except for asbestos used as a building material for the
Property and except for a fuel oil tank located at the south end of
2001 Xxxxxxx, Owner has received no notice of and has no actual
knowledge, without inquiry (a) that any Hazardous Substance are or
have ever been generated, manufactured, buried, spilled, leaked,
discharged, emitted, stored, disposed of, used or released about the
Property, except as hereinbefore provided, or (b) of any, requests,
notices, investigations, demands, administrative proceedings, hearings,
litigation or other action proposed, threatened or pending relating
to any of the Property and alleging non-compliance with or liability
under any Environmental Law, or (c) that any above-ground or
underground storage tanks or other containment facilities of any kind
containing any Hazardous Substance are or have ever been located
about the Property, or (d) that Owner's operations on the Property
have been in compliance with all federal, state and local
environmental laws, ordinances, rules and regulations, relating to
the handling, storage and disposal of the Hazardous Materials. For
purposes hereof, Hazardous Substance means asbestos, urea
formaldehyde, polychlorinated biphenyls, nuclear fuel or materials,
radioactive materials, explosives, known carcinogens, petroleum
products and by-products (including crude oil or any fraction
thereof), and any pollutant, contaminant, chemical, material or
substance defined as hazardous or as a pollutant or a contaminant in,
or the use, manufacture, generation, storage, treatment,
transportation, release or disposal of which is regulated by, any
Environmental Law. For purposes hereof, Environmental Law means any
federal, state, county, municipal, local or other statute, ordinance
or regulation which relates to or deals with the protection of the
environmental and/or human health and safety, including all
regulations promulgated by a regulatory body pursuant to any such
statute, ordinance, or regulation, including, the Comprehensive
Environmental Response and Liability Act of 1980 ("CERCLA"), as
amended, 42 U.S.C. Section 9601 et. seq., the Resource Conservation
and Recovery Act ("RCRA"), as amended, 42 U.S.C. Section 6901 et.
seq., the Federal Water Pollution Control Act, as amended, 33 U.S.C.
Section 1251 et. seq., the Clean Air Act, as amended, 42 U.S.C.
Section 7401 et. seq., and Minnesota Statutes Section 115B.01 et seq.
(m) To the best of Owner's knowledge, no unrecorded condition, restriction,
obligation or agreement not previously disclosed to Buyer exists which
affect the Property or Buyer's ability to use the Property for the
Current Uses.
(n) To the best of Owner's knowledge, no portion of the Property is located
within an area designated as a "flood plain" or "flood prone area"
under any statute, regulation, or ordinance.
(o) To the best of Owner's knowledge, the Property is free from any use
or occupancy restrictions, except those imposed by zoning laws and
regulations, and no part is dedicated or has been used as a cemetery or
burial ground.
(p) To the best of Owner's knowledge, no fact or condition exists which
would result in the termination of the current access to the Property
from any presently existing streets (except the parties' proposed
vacation of the easterly portion of Xxxxxx Street and the proposed
vacation of part of Summer Street and the proposed vacation of
Cleveland Street (north of Xxxxxxx Street and south of Summer Street))
and roads adjoining or situated on the Property or to any existing
sewer or other utility facilities servicing, adjoining or situated on
the Property. To the best of Owner's knowledge, all utilities needed
for Current Uses are available to the Property.
(q) There is no litigation at law or in equity, and no action, litigation,
investigation or proceedings of any kind, including, but not limited
to, administrative or regulatory authority, pending or threatened
against the Property, or the Owner, or affecting the ability of Owner
to consummate the transaction contemplated herein and Owner knows of no
facts which could give rise to any such action, litigation,
investigation or proceeding with respect to the Property or the Owner.
(r) To the best of Owner's knowledge, there are no outstanding citations
or notices of violations of any statutes, ordinances or regulations
of any kind, with respect to the Property and to the best of Owner's
knowledge, there are no structural defects in the Buildings including
the roof, but the foregoing shall not be construed as a warranty for
the roof of the Buildings.
(s) To the best of Owner's knowledge, (i) the Property is zoned for the
Current Uses, (ii) the Property contains no xxxxx, and (iii) the
Property does not contain any septic systems.
(t) To the best of Owner's knowledge, except for a right that may be
granted by Owner to RREEF Venture Capital Fund L.P., or any of its
affiliates (hereinafter "RREEF"), to purchase the Property which
right shall be contingent on the termination of this Option Agreement,
no other party has any right, title or interest in and to the Property,
including the right to purchase the Property, except as set forth as
a Permitted Encumbrance and except for the rights of tenants, as
tenants only. Owner represents and warrants that in the event it enters
into a purchase agreement with RREEF for the sale of the Property
contingent upon the termination of this Option Agreement, such purchase
agreement will be entered into only if RREEF executes a quitclaim deed
in favor of Owner as to the Property to be placed in escrow with Title
and to be delivered upon Buyer's closing its purchase of the Property
under the Purchase Agreement.
(u) Upon Owner's acquisition of title to the Property, Owner shall cure
any violations of law or municipal ordinance, orders or requirements
for which Owner had received a notice of violation prior to the
closing which would affect the Buyer's use of the Property and which
would be binding upon the Property or Buyer after the closing, it
being understood that the Property is to be renovated upon its
purchase and no such violation need be cured if as a result of the
renovations the violation becomes moot.
None of the foregoing warranties shall be construed as a warranty as
to the sufficiency of parking, it being understood that parking
requirements are dependent on the usage of the Property by the Buyer.
Except for the foregoing warranties, Buyer acknowledges that it is
purchasing the Property in its "as is" condition relying solely on
its inspection and knowledge of the Property.
Owner covenants that prior to the termination of this Option
Agreement, it will not knowingly take any affirmative action that
would purposely cause any of the representations and warranties
contained herein to be materially breached. The sole and exclusive
remedy for Buyer under any theory of law for a breach by Owner of
this covenant shall be the return of the cash portion of the Option
Fee, if Buyer chooses not to exercise the option. If Buyer exercises
the Option with knowledge of such breach by Owner, Buyer shall be
deemed to have waived such breach.
5. Right to Enter; Soil Tests; Surveys. After Owner has acquired fee
title to the Property but prior to Buyer's exercise of its options herein
granted and subject to the rights of tenants, Buyer and its agents shall have
the right to enter upon the Property for purposes of making soil tests, surveys,
and engineering and architectural studies and tests. Owner agrees to give Buyer
written notice of such acquisition date within three (3) business days of such
acquisition. Buyer hereby agrees to indemnify and hold harmless Owner from all
liabilities, expenses and attorneys' fees incurred by Owner and arising out of
such entry, or the taking of such tests, surveys, analysis, studies and tests
upon the Property. This indemnification and hold harmless agreement shall
survive termination or expiration of this Agreement and of the option granted
under this Agreement, exercise of the option, and/or consummation of the
transaction herein contemplated. All results of surveys, topographies and tests
will be forwarded to Owner and Buyer hereby consents to Owner utilizing the
same, and if Buyer fails to exercise its option, all the originals of such
materials will be deemed the property of Owner and Buyer agrees to promptly
furnish such originals at Owner's request.
6. No Commissions. Each party represents and warrants to the other that
they have not incurred any real estate brokerage fees, finder's fees, or any
other fees or commissions of any kind or nature due or owing to any third party
as a result of the execution of this Option Agreement or as a result of the sale
of any of the Property. Owner and Buyer each hereby indemnify the other against
and shall hold the other harmless from any and all claims, damages, costs or
expenses of or for such fees or commissions that have been incurred by their
actions.
7. Leases. During the term of this Option Agreement, Owner, subject
to Buyer's rights hereafter set forth, shall be free to execute leases with
third party tenant(s) for a term or period to expire no later than
(i) December 31, 2011 with respect to space on the first and/or lower level
located north of column 8 as shown on Exhibit D hereto attached; and (ii) July
1, 2005 with respect to space on the first and/or lower level located south of
column 8 as shown on Exhibit D hereto attached. Owner shall not lease any of
the Property to tenants whose primary business involves the storing and/or
manufacturing of hazardous materials and will insert in all new leases
hereafter entered into a prohibition of such business of generation and/or
storage of hazardous materials. Before Owner enters into any third party
leases, including leases falling within subparagraphs (i) and (ii), Owner
shall submit in writing to Buyer written notice of a proposal of the terms and
conditions of the proposed third party lease in outline form containing
length of lease, rent, estimated operating expenses, scope and responsibility
for payment of Tenant Improvements and any tenant inducements. Owner agrees
not to enter into such third party lease if within three (3) business days
after receipt of the proposal the Buyer either:
(a) Exercise its purchase option at that time; or
(b) Agrees in writing to enter into a lease of the space from Owner under
the same basic terms and conditions as the Third Party.
If Buyer fails to exercise its rights in subparagraphs (a) or (b) above, Owner
may enter into such third party lease containing substantially similar terms as
set forth in the proposal. Notwithstanding the foregoing, this entire paragraph
7 shall not apply to a lease with UCare Minnesota which is consented to by
Buyer.
8. Notices. Any notice or election herein required or permitted to be
given or served by either party hereto upon the other shall be deemed given or
served in accordance with the provisions of this Agreement, if served personally
or if mailed by United States registered or certified mail, postage prepaid,
properly addressed as follows:
If to Owner: Hillcrest Development
0000 Xxxxxxx Xxxxxx XX
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxx
with a copy to: Maun & Simon, PLC
0000 Xxxxxxx Xxxxx Xxxxxxxx Xxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxxx Bans, Esq.
If to Buyer: R & D Systems, Inc.
000 XxXxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxx Xxxxx, CEO
with a copy to: Xxxxxxxxxx & Xxxxx, P.A.
000 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Each mailed notice of communication shall be deemed to have been given when
served upon, the party to which addressed or if mailed on the date the same is
actually received by the addressee. The addresses to which notices are to be
mailed to either party hereto may be changed by such party by giving written
notice thereof to the other party in the manner above provided.
9. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties hereto, and their respective successors and
assigns. It is expressly agreed that this Agreement shall be assignable by
Buyer; provided, however, that no such assignment shall be valid unless written
notice thereof has been first provided to Owner.
10. Recording. The parties agree to execute at the closing of the
Purchase Agreement a recordable memorandum of Option Agreement in the form of
Exhibit E hereto attached ("Memorandum") for purposes of memorializing of record
this Agreement. Buyer shall deposit in escrow with Title a quitclaim deed to
the Property in the event Buyer fails to consummate its purchase from Owner of
the Property but Title shall not release the quitclaim deed from escrow and/or
record the deed until after Title has provided Buyer with at least five (5) days
prior written notice.
11. Condemnation. If any portion of the Property but not the whole is
condemned prior to the exercise of the option herein granted, any proceeds
received by Owner shall first be applied by Owner to restore the Property to the
extent commercially reasonable and/or to the extent required by any applicable
leases and the balance, if any, be applied against the Purchase Price if the
option is exercised and Buyer consummates its purchase of the Property pursuant
to the Exhibit B Purchase Agreement. If the entire Property is condemned prior
to the exercise of the option, this option shall be null and void and fifty
percent (50%) of any cash portion of the Option Fee previously paid by Buyer to
Owner shall be refunded to Buyer.
12. Casualty. If any "major" damage to the 2001 Xxxxxxx Building occurs
prior to the exercise of the option granted herein, Buyer shall elect within ten
(10) days of notice from Owner as to the amount of insurance proceeds to be
received by Owner whether Buyer (i) wishes to terminate its rights under this
Option Agreement, or (ii) wishes to then exercise its option and close pursuant
to the Exhibit B Purchase Agreement (without regard to the provisions therein as
to casualty and damage) with a credit against the Purchase Price equal to the
actual insurance proceeds received by Owner but in no event shall such credit
exceed the excess of Purchase Price over one-half of the Option Fee. If any
"minor" damage to the 2001 Xxxxxxx Building occurs prior to the exercise of the
option granted herein, Owner must use the available insurance proceeds to
restore such building unless within thirty (30) days of notice from Owner as
to the amount of insurance proceeds to be received by Owner, Buyer elects to
exercise its option and close pursuant to the Exhibit B Purchase Agreement
(without regard to the provisions therein as to casualty and damage) with Buyer
receiving a credit against the Purchase Price equal to the actual insurance
proceeds received by Owner but in no event shall such credit exceed the excess
of the Purchase Price over one-half of the Option Fee.
For purposes of this paragraph, a "major" damage is defined as damage more
than twenty-five percent (25%) of the value of the 2001 Xxxxxxx Building and a
"minor" damage is defined as damage to such building in an amount less than or
equal to twenty-five percent (25%) of the value of such building.
13. Proposed Vacation of Summer Street and Xxxxxx Street. It is
contemplated by the parties that part of Summer Street lying between 2001
Xxxxxxx and 0000 Xxxxxxxx parking lot and the easterly portion of Xxxxxx Street
between Summer and Xxxxxxx Streets, will be vacated by Owner and the parties
agree that upon such vacation that all of such vacated street shall accrue to
2001 Xxxxxxx and the parties shall execute and deliver such deeds as are
necessary to accomplish the same.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
OWNER: BUYER:
Hillcrest Development R & D Systems, Inc.
By: /s/ Xxxxx Xxxxxxxxx By: /s/ Xxxxxx X. Xxxxx
Its: General Partner Its: President
ACKNOWLEDGMENT BY TITLE
The undersigned acknowledges receipt of a copy of the foregoing and agrees
to act as Escrow Agent for the parties and to invest the cash portion of the
Option Fee in an interest-bearing federally insured bank account.
First American Title Insurance Company
By: /s/ Xxxxxx X. Xxxx
Its: Assistant Vice President
EXHIBIT B
PURCHASE AGREEMENT
(2001 Xxxxxxx Option)
THIS AGREEMENT is entered into this _____ day of _______, ______, by and
between Hillcrest Development, a Minnesota limited partnership
(hereafter referred to as the "Seller"), and R & D Systems, Inc., a Minnesota
corporation, (the "Buyer"), upon the basis of the following facts,
understandings and intentions of Seller and Buyer.
RECITALS:
1. Seller is the fee simple owner of the real property ("Land") improved
with a building ("Building") commonly known as 2001 Xxxxxxx and is the current
fee simple owner of real property ("Parking Land") to be used for surface
parking lot commonly known as the "2020 Broadway Lot," all of which are located
in the City of Minneapolis, County of Hennepin, State of Minnesota, and legally
described in Exhibit A hereto attached.
2. Buyer has pursuant to an Option Agreement ("Option Agreement") duly
exercised an option granted by Seller to purchase the Land, the Building, the
Parking Land, and all licenses, permits, equipment, fixtures and furnishings and
all other personal property, tangible or intangible, owned by Seller and
currently located on the Land and solely used in the operation and maintenance
of the foregoing (hereafter said licenses, permits, equipment, fixtures and
furnishings and other included personal property shall be referred to in the
aggregate as "Personal Property," and hereafter the Land, the Building, the
Parking Land, and Personal Property is sometimes referred to in the aggregate as
the "Property") in accordance with the terms and conditions hereinafter set
forth.
3. Seller is willing to grant and extend to Buyer such purchase right as
the terms hereafter set forth.
NOW, THEREFORE, in consideration of the agreements hereinafter provided
and other good and valuable consideration, Seller agrees to sell and Buyer
agrees to purchase from Seller the Property, together with and including all
hereditaments, appurtenances, easements and rights of way thereunto belonging or
in any way appertaining and also the right, title and interest (if any) of
Seller in and to the bounding and abutting streets, alleys and highways, subject
to and upon the following terms and conditions:
SECTION I
PURCHASE PRICE
It is hereby agreed that the Purchase Price of the Property shall be Seven
Million and 00/100 Dollars ($7,000,000.00) plus Capital Improvement Cost
identified in Section VIII hereof (the "Purchase Price"), which shall be paid by
Buyer to Seller as follows:
(i) $1,999,000.00 has already been paid into escrow as provided for in
Section II below.
(ii) The remainder of the Purchase Price will be payable at closing in
immediately available funds.
The Purchase Price shall be allocated as follows:
$_________________ to 2001 Xxxxxxx;
$_________________ to Parking Land.
SECTION II
XXXXXXX MONEY DEPOSIT
Buyer has already deposited in escrow with First American Title Insurance
Company (the "Escrow Agent" and sometimes hereafter "Title") the sum of
$1,999,000.00, (this sum plus all accrued interest thereon shall be referred to
as the "Deposit") which shall be retained by the Escrow Agent for the benefit of
Seller and Buyer in accordance with the provisions of this Purchase Agreement.
The parties hereby agree to execute such documentation, if any, reasonably
required by the Escrow Agent in connection with the disbursement of the Deposit
and establishment of said xxxxxxx money escrow referenced above.
SECTION III
INVESTMENT AND DISBURSEMENT OF DEPOSIT
The Escrow Agent is hereby directed to invest the Deposit represented by
cash in a segregated U.S. Treasury-backed money market account with U.S. Bancorp
in Minneapolis, Minnesota.
The Deposit shall be disbursed by the Escrow Agent as follows:
(a) Except as provided for in (b) or (c) below, the Deposit shall
be deemed nonrefundable and shall be delivered to Seller either upon the
termination of this Purchase Agreement or upon the closing of the sale
of the Property as partial payment of the Purchase Price.
(b) Fifty percent (50%) of the Deposit shall be delivered to
Buyer in the event: (i) Buyer terminates this Purchase Agreement
pursuant to Sections IV, V, VI or XII (in the event Buyer terminates
this Purchase Agreement because Seller is in material breach of its
representations and warranties other than pursuant to the last paragraph
of Section IX) hereof; (ii) Buyer terminates this Purchase Agreement
pursuant to Section XVI hereof; (iii) Buyer terminates this Purchase
Agreement pursuant to Section XVII hereof.
(c) One hundred percent (100%) of the Deposit shall be delivered
to Buyer in the event Buyer chooses to terminate this Purchase Agreement
pursuant to the last paragraph of Section IX, or as a result of Seller
refusing to perform any of its obligations set forth herein pursuant to
Section XII other than a breach of its representations and warranties.
(d) Interest in the Deposit shall inure to the benefit of Buyer,
in all events.
SECTION IV
BUYER'S CONDITIONS PRECEDENT
Seller agrees that this Purchase Agreement shall be conditioned upon Buyer
satisfying itself, in its sole and absolute judgment, that the following
conditions precedent with respect to the Property are met:
(a) Buyer's inspection and approval of the Land, the Building,
the Parking Land, Personal Property, the Other Agreements (as
hereinafter defined) and all other information required herein to be
provided to Buyer by Seller, all during regular weekday business hours.
Seller agrees to allow Buyer and its agents the right of any ingress or
egress over and through the Property for the purpose of inspecting the
same and making other observations as Buyer deems reasonably necessary.
Buyer agrees to indemnify and hold Seller harmless from all injury,
death or property damage or claims of any kind whatsoever including
mechanic's liens arising out of or in any way incidental to Buyer's
presence on the Property for the purposes aforesaid. This indemnity
shall survive the termination of this Purchase Agreement, regardless of
which party elects to terminate this Purchase Agreement. To the extent
Seller has not already done so, Seller agrees to provide to Buyer or
allow Buyer access to the following items within ten (10) days from the
execution of this Purchase Agreement:
(i) copies of Plans and Specifications, blueprints,
operating manuals, surveys and licenses, if any, in Seller's
possession, used to operate the Building and the remainder of the
Property;
(ii) complete copies of all contracts ("Other Agreements")
and leases ("Leases") currently affecting the Property;
(iii) copies of all permits or authorizations, if any, in
Seller's possession, required to be issued by any governmental
body having jurisdiction in connection with any state of facts or
activity presently existing or being carried on with respect to
the Property;
(iv) copies of all warranties and guaranties, if any, which
are still effective and which pertain to the Property or any
portion thereof ("Warranties");
(v) inventory of the Personal Property owned by the Seller
and located on the Land and used in connection with the operation
of the Property;
(b) Buyer may use the Property for its existing uses and it uses
of the property located at 2201 Xxxxxxx, 614 XxXxxxxx and 640 XxXxxxxx
as of February, 1999 ("Current Uses") without being in violation of any
zoning classification, land use classification, environmental
requirement, or any other use classification or building classification
or requirement established by any entity or authority having legal
jurisdiction or authority thereover.
(c) All utilities, including but not limited to electricity, gas,
water (fire and domestic) storm and sanitary sewer, are available on
site, through valid and adequate public or private easements for Current
Uses; provided that in the case of private easements, they are
appurtenant to the Property, or on the Property's side of abutting
streets of size and capacity sufficient to serve the Current Uses.
(d) Buyer approving, as provided in Section V(A) hereof, any
environmental audits for the Property.
(e) Within thirty (30) days of the date of this Purchase
Agreement, Seller shall provide Buyer with original estoppel
certificates from all tenants of the Property in form reasonably
acceptable to Buyer to the extent Seller is able to obtain the same by
exercising its best effort.
This Purchase Agreement shall be deemed terminated and neither party liable
to the other herein unless Buyer affirmatively accepts or waives in writing to
Seller the foregoing conditions by January 15, 2005. Upon any such termination
of this Purchase Agreement by Buyer failing to waive or accept all of the
foregoing conditions or as provided in the last sentence of this Section, all
parties hereto shall be released from all duties and obligations to each other
contained herein (except for Buyer's Indemnity under Sections IV(a) and V(A)
hereof) and upon such termination Buyer shall be entitled to a partial or full
refund as described in Sections III(b) or III(c) hereof. Notwithstanding the
foregoing, Buyer may elect to terminate this Purchase Agreement between
January 15, 2005 and the date of closing in the event (i) environmental testing
done between such dates pursuant to Section V hereof reveal a contamination
previously unknown on January 15, 2005, or (ii) a change in any item referred to
in (b) above occurs between January 15, 2005 and the date of closing so as to
prohibit the use of the Property for Current Uses.
SECTION V
ENVIRONMENTAL AUDITS AND SURVEY
A. Environmental Audits. Seller has provided to Buyer prior to
January 6, 1999 environmental reports ("Environmental Reports") for the Property
at no cost or expense to Buyer which are described in Exhibit C hereto attached
and that except for the "Exhibit D" information described in paragraph 4(l) of
the Option Agreement, to the best of Seller's knowledge, such materials
constitute all of the environmental reports in Seller's possession or control.
Buyer shall have the right to do additional environmental audits and/or soil
tests subject to the reasonable prior written approval of Seller regardless of
the cost as long as Buyer pays for all of such costs; provided, however, no such
additional testing shall be done beyond January 15, 2005 unless the testing is
based on new information not previously known to Buyer. If such additional
tests reveal the presence of any material amounts of hazardous materials not
disclosed in the Environmental Reports, and not otherwise "known" to Buyer as
of July 1, 1999, Buyer may terminate this Purchase Agreement by giving Seller
notice of the same prior to (i) January 15, 2005 for the discovery of such
materials prior thereto or (ii) the closing date for the discovery of such
materials after January 15, 2005 and prior to the closing date and upon such
termination Buyer shall be entitled to a partial or full refund as described
in Section III(b) or III(c) hereof. Buyer shall be deemed to have "known" of
any hazardous materials if Buyer had in its possession copies of materials
describing such hazardous materials as of July 1, 1999. Buyer agrees to
indemnify and hold Seller harmless from all mechanic's liens liability and
other costs and expenses arising from Buyer's doing such additional
environmental audits and/or soil tests. The foregoing indemnity shall
survive the termination of this Purchase Agreement.
B. Survey. Seller has provided Buyer with a survey ("Survey") of the
Property.
C. Copies of Documents. To the extent not already done, Seller shall
promptly deliver to Buyer or make available to Buyer copies of all soil tests,
environmental audits, surveys and other documents relating to the physical
properties of the Property which are within Seller's control and Buyer agrees to
promptly deliver to Seller copies of all of such items which are within Buyer's
control.
SECTION VI
TITLE EVIDENCE
A. Seller will, at Seller's expense, provide Buyer within thirty (30)
days after the date hereof with a commitment(s) (the "Commitment") for an
Owner's Policy of Title Insurance for the Property issued by Title along with
updated Surveys certified to Title, Buyer, Techne Corporation and Buyer's
lender. Buyer shall pay at closing the premium for the actual title insurance
policy, if any, to be purchased by Buyer. The Commitment shall include waiver
of standard exceptions, a zoning and comprehensive endorsements and a
contiguity endorsement as to the Land and each separate parcel comprising the
Parking Land and shall include legible copies of all documents, maps, or plats
set forth therein as affecting the Property and shall be issued through Title
in its capacity as a title insurance company by its local office or by its
local agent (the "Title Company") situated in the county where the Property
is located. The Commitment shall be issued in the name of Buyer, Techne
Corporation and Buyer's lender.
B. Within thirty (30) days after receiving the Commitment and the
updated Surveys, but no later than the closing date, as hereafter defined, Buyer
shall deliver to Seller a written statement containing any objection Buyer has
to the state of title, including Survey objections but excluding objections to
Permitted Encumbrances and excluding matters disclosed by surveys provided to
Buyer prior to February 26, 1999. If such statement of objection is not
delivered by such date, title shall be deemed approved by Buyer except for
Schedule B, Section 1 requirements of the commitment ("Requirements") which
Seller agrees to satisfy at closing. If any objection other than the
Requirements is not cured or removed by the closing date, Buyer, at its option,
may, prior to the closing date, either (i) accept title as it is, subject to
Seller's obligations to satisfy the Requirements; or (ii) terminate this
Purchase Agreement. Seller shall have no obligations to cure any Permitted
Encumbrances. Upon any such termination all parties shall be released from all
duties or obligations contained herein (except for Buyer's Indemnity under
Section IV(a) or V(A) hereof) and Buyer shall be entitled to a partial or full
refund of the Deposit as described in Sections III(b) or III(c) hereof.
SECTION VII
1031 EXCHANGE
At either party's request, the other party agrees to cooperate with the
requesting party in a deferred or simultaneous Section 1031 like kind
exchange(s) of all or any portion of the Property for which the Purchase Price
has been separately allocated herein as long as the other party is not required
to take title to any other property or to incur any further cost, expense,
liability or delay. The Deposit of $1,999,000.00 in the event of any such
exchange(s) shall be allocated to 2001 Xxxxxxx.
SECTION VIII
ADDITIONAL PURCHASE PRICE
As additional Purchase Price, Buyer shall pay the amount as hereafter set
forth of Seller's expenditures for capital improvements on the Property made
after June 1, 1999 together with up to a ten percent (10%) fee for Seller's
profit and overhead if Seller or its affiliates is the general contractor
("Capital Improvement Cost") provided that such capital expenditures are for
the improvements described in Exhibit D hereto attached. Any such capital
improvement shall be amortized over two hundred four (204) months at the
lowest Applicable Federal Interest Rates (AFR) as published as of the
completion date of the improvement by the Internal Revenue Service commencing
as of the date the improvement has been completed. The Capital Improvement
Cost for each such capital improvement shall be equal to the monthly amortized
amount multiplied by a number equal to 204 less the number of months
(including fractions thereof) between the completion date of such improvement
and the closing hereof.
SECTION IX
WARRANTIES
Seller warrants and represents to Buyer that the following statements are
as of February 26, 1999, the date hereof, at closing and after closing to the
extent hereinafter provided, will be true and accurate, except for such material
changes (other than changes resulting from the affirmative and purposeful acts
of Seller contemplated by the last paragraph of this Section IX), that Seller
has notified Buyer in writing at the time of Seller's execution of this Purchase
Agreement:
(a) Seller will have marketable and insurable record title to the
Property as of closing, subject only to the Permitted Encumbrances
listed on Exhibit B attached hereto and made a part hereof.
(b) To the best of Seller's knowledge, the information supplied
to Buyer pursuant to Section IV(a) hereof is complete and correct except
for the materials described in the Option Agreement as "Exhibit D to the
Purchase Agreement" and has been duly supplemented including, but not
limited to, any new Other Agreements.
(c) At closing, Seller shall (i) convey to Buyer by Warranty Deed
the Property and convey by Warranty Xxxx of Sale the Personal Property
to Buyer free of all encumbrances on the Property or any portion thereof
except for the Permitted Encumbrances and other matters approved by
Buyer pursuant to Section VI or as otherwise provided herein; and (ii)
shall assign to the extent they are assignable, all of Seller's interest
in the "Other Agreements" and the Leases, if any.
(d) Seller has not received any notice nor are they aware of any
pending or threatened action to take by eminent domain or by deed in
lieu thereof all or any portion of the Property.
(e) Seller shall be solely responsible for and shall pay on the
date of closing any deferred tax or assessment, including, but not
limited to, those referred to in Minnesota Statutes Section 273.11 (the
so-called "Green Acres recapture"), catch-up or adjustment in future
taxes due as a result of the Property having been classified under any
designation authorized by law to obtain a special low ad valorem tax
rate or receive either an abatement or deferment of ad valorem taxes.
(f) Seller is not a "foreign person" as contemplated by Section
1445 of the Internal Revenue Code, and that at the closing Seller will
deliver to Buyer a certificate so stating, in a form complying with the
Federal tax law.
(g) This Purchase Agreement and the documents, instruments and
agreements to be executed by Seller pursuant to this Purchase Agreement
have been, or will be on or before the date of closing, duly and validly
authorized, executed and delivered by Seller and the obligations of
Seller hereunder and thereunder are or will be valid and legally
binding, and this Purchase Agreement and the documents, instruments and
agreements to be executed and delivered by Seller pursuant to this
Purchase Agreement are or will be upon such execution and delivery
enforceable against Seller in accordance with their respective terms.
(h) Except as shown by the materials described in Exhibit C and
Exhibit D to the Purchase Agreement (as defined in the Option
Agreement), except for acts of Buyer, as a possible tenant of the
Property and the use by Buyer of hazardous materials, except for
asbestos used as a building material for the Property and except for a
fuel oil tank located at the south end of 2001 Xxxxxxx, to the best of
Seller's knowledge, Seller has not generated, manufactured, buried,
spilled, leaked, discharged, emitted, stored, disposed of, used or
released any Hazardous Substance (as hereafter defined) about the
Property, except as may have occurred as a result of operating the
Property and in any such event such activities were at all times in
compliance with Environmental Laws as hereinafter defined and has not
knowingly permitted any other party to do any of the same. Except for
and to the extent of the matters specifically described in said Exhibit
C and Exhibit D, except for acts of Buyer, as a possible tenant of the
Property and the use by Buyer of hazardous materials, except for
asbestos used as a building material for the Property and except for a
fuel oil tank located at the south end of 2001 Xxxxxxx, Seller has
received no notice of and has no actual knowledge, without inquiry
(a) that any Hazardous Substance are or have ever been generated,
manufactured, buried, spilled, leaked, discharged, emitted, stored,
disposed of, used or released about the Property, except as
hereinabove provided, or (b) of any, requests, notices,
investigations, demands, administrative proceedings, hearings,
litigation or other action proposed, threatened or pending relating
to any of the Property and alleging non-compliance with or liability
under any Environmental Law, or (c) that any above-ground or
underground storage tanks or other containment facilities of any kind
containing any Hazardous Substance are or have ever been located
about the Property, or (d) that Seller's operations on the Property
have been in compliance with all federal, state and local
environmental laws, ordinances, rules and regulations, relating to
the handling, storage and disposal of the Hazardous Materials. For
purposes hereof, Hazardous Substance means asbestos, urea
formaldehyde, polychlorinated biphenyls, nuclear fuel or materials,
radioactive materials, explosives, known carcinogens, petroleum
products and by-products (including crude oil or any fraction
thereof), and any pollutant, contaminant, chemical, material or
substance defined as hazardous or as a pollutant or a contaminant in,
or the use, manufacture, generation, storage, treatment,
transportation, release or disposal of which is regulated by, any
Environmental Law. For purposes hereof, Environmental Law means any
federal, state, county, municipal, local or other statute, ordinance
or regulation which relates to or deals with the protection of the
environmental and/or human health and safety, including all
regulations promulgated by a regulatory body pursuant to any such
statute, ordinance, or regulation, including, the Comprehensive
Environmental Response and Liability Act of 1980 ("CERCLA"), as
amended, 42 U.S.C. Section 9601 et. seq., the Resource Conservation and
Recovery Act ("RCRA"), as amended, 42 U.S.C. Section 6901 et. seq., the
Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251
et. seq., the Clean Air Act, as amended, 42 U.S.C. Section 7401 et. seq.,
and Minnesota Statutes Section 115B.01 et seq.
(i) To the best of Seller's knowledge, no unrecorded condition,
restriction, obligation or agreement not previously disclosed to Buyer
pursuant to Section IV shall exist which affect the Property or Buyer's
ability to use the Property for the Current Uses.
(j) To the best of Seller's knowledge, no portion of the Property
is located within an area designated as a "flood plain" or "flood prone
area" under any statute, regulation, or ordinance.
(k) To the best of Seller's knowledge, the Property is free from
any use or occupancy restrictions, except those imposed by zoning laws
and regulations, and no part is dedicated or has been used as a cemetery
or burial ground.
(l) To the best of Seller's knowledge, no fact or condition
exists which would result in the termination of the current access to
the Property from any presently existing streets (except the parties'
proposed vacation of Xxxxxx Xxxxxx, Xxxxxxxxx Xxxxxx and Xxxxxx Street)
and roads adjoining or situated on the Property or to any existing sewer
or other utility facilities servicing, adjoining or situated on the
Property. To the best of Seller's knowledge, all utilities needed for
Current Uses are available to the Property.
(m) There is no litigation at law or in equity, and no action,
litigation, investigation or proceedings of any kind, including, but not
limited to, administrative or regulatory authority, pending or
threatened against the Property, or the Seller, or affecting the ability
of Seller to consummate the transaction contemplated herein and Seller
knows of no facts which could give rise to any such action, litigation,
investigation or proceeding with respect to the Property or the Seller.
(n) To the best of Seller's knowledge, there are no outstanding
citations or notices of violations of any statutes, ordinances or
regulations of any kind, with respect to the Property and to the best of
Seller's knowledge, there are no structural defects in the Buildings
including the roof, but the foregoing shall not be construed as a
warranty for the roof of the Buildings.
(o) To the best of Seller's knowledge, (i) the Property is zoned
for the Current Uses without being in violation of any zoning
classification, land use classification, environmental requirement, or
any other use classification or building classification or requirement
established by any entity or authority having legal jurisdiction or
authority thereover, (ii) the Property contains no xxxxx, and (iii) the
Property does not contain any septic systems.
(p) To the best of Seller's knowledge, except for the rights of
existing tenants, if any, as tenants only, no other party has any right,
title or interest in and to the Property, including the right to
purchase the Property, except as set forth as a Permitted Encumbrance.
(q) Except for requirements imposed by the City of Minneapolis
relating solely to Buyer's anticipated improvements to the Property and
not to preexisting conditions, Seller shall cure any violations of law
or municipal ordinance, orders or requirements for which Seller had
received a notice of violation prior to the closing which would affect
the Buyer's use of the Property and which would be binding upon the
Property or Buyer after the closing, it being understood that the
Property is to be renovated upon its purchase and no such violation need
be cured if as a result of the renovation the violation becomes moot.
(r) Seller has not leased the Property to tenants in violation of
paragraph 7 of the Option Agreement.
(s) Seller will use its best efforts to obtain tenant estoppel
certificates from all tenants as provided in Section IV(e).
(t) Seller will continue through closing to maintain insurance
coverages on the Property as required by the Option Agreement.
(u) To the extent commercially reasonable after any
condemnation and/or casualty, Seller will upon its acquisition of
Title to the Property operate, maintain and repair the Property in a
commercially reasonable fashion.
(v) Upon Seller's acquisition of Title to the Property, Seller
will maintain casualty insurance for at least $9,000,000.00 on the
2001 Xxxxxxx Building to the extent it can be economically purchased.
It is assumed that any aggregate increases of less than one hundred
percent (100%) of the current cost shall be economical.
(w) Upon Seller's acquisition of Title to the Property, Seller
will not thereafter knowingly lease the Property to tenants who
engage in the business of the generation and/or storage of hazardous
materials and will insert in all new leases hereafter entered into a
prohibition of such business of generation and/or storage of
hazardous materials but the foregoing shall be breached if any
tenant, without Seller's consent or knowledge, engages in such
activities. Seller will take appropriate action to terminate the
rights of any tenant who violates such prohibition.
None of the foregoing warranties shall be construed as a warranty as
to the sufficiency of parking, it being understood that parking
requirements are dependent on the usage of the Property by the Buyer.
Except for the foregoing warranties, Buyer acknowledges that it is
purchasing the Property in its "as is" condition relying solely on its
inspection of the quantity and quality of the Property including the
floor, the structural portions of the Property and the roof. The
foregoing representations and warranties will survive until December 31,
2005 ("Final Action Date"). The parties agree that all actions
commenced by Buyer against Seller based on such representations and
warranties shall be deemed time barred unless such actions have been
commenced prior to the Final Action Date or such claims are based on
fraud, it being understood that except for claims based on fraud, Buyer
shall be deemed to have released Seller for any claims based on such
representations and warranties unless an action based thereon is
commenced prior to Final Action Date.
Seller covenants that, at any time prior to the closing, it has not
and will not knowingly take(n) any affirmative action that would
purposely cause the representations and warranties contained herein
to be materially breached. The sole and exclusive remedy for Buyer
under any theory of law for a breach by Seller of this covenant shall
be the termination of this Agreement and the return of the Deposit
pursuant to Section III(c), if Buyer chooses not to close. If Buyer
chooses to close with knowledge of such breach by Seller, Buyer shall
be deemed to have waived such breach.
SECTION X
CLOSING
The closing of this transaction shall take place in the office of Title in
Minneapolis, Minnesota on or before July 1, 2005, notwithstanding any other
provision hereof to the contrary. Possession of the Property shall be deemed to
have been given by Seller to Buyer coincident with the closing. The following
procedure shall govern the closing:
(a) Prior to closing, Seller shall deliver to Buyer and Title a
copy of the proposed general Warranty Deed (the "Deed") which shall be
in recordable form and shall convey good and marketable record title to
the Property (using the legal descriptions set forth on the Title
Commitment and the Survey) to Buyer, subject only to the Permitted
Encumbrances and other matters approved by Buyer. If the form of the
Deed does not comply with the provisions set forth above, the Seller
shall promptly correct the same upon notice from either Buyer or the
Title Company.
(b) On or before the closing Seller shall deliver to the Title
Company or Buyer the following:
(i) the Deed, properly executed and acknowledged along with
a standard form Seller's Affidavit;
(ii) current real estate tax statements;
(iii) any applicable owner's duplicate certificate(s) of
title to the Property;
(iv) any applicable abstracts of title in Seller's
possession;
(v) a warranty xxxx of sale properly executed for all
Personal Property;
(vi) properly executed assignments of all Seller's interest
in and to the Leases and Other Agreements and which shall provide
that Seller will indemnify and hold Buyer harmless from all claims
under the foregoing which accrued on or prior to closing and Buyer
shall agree to indemnify and hold Seller harmless from all claims
under the foregoing which accrue after the closing;
(vii) a well certificate as may be required by applicable law
or in the event it is not required, a certification in the deed
that there are no xxxxx on the Property;
(viii) an assignment of the Warranties and any other
documents required by this Purchase Agreement;
(ix) any other documentation reasonably requested by the
Title Company in order to confirm the authority of the Seller to
consummate this transaction or to permit the Title Company to
issue to Buyer, upon completion of the closing, its Owner's Title
Insurance Policy in an amount equal to the Purchase Price, subject
only to those matters shown on the Commitment which were approved
by Buyer (the "Title Policy"); Provided, however, that the
foregoing shall not be construed to obligate Seller to provide any
indemnity or to pay any sums not otherwise required to be paid by
Seller hereunder;
(x) such funds as may be required by Seller to pay closing
costs or charges properly allocable to Seller.
(c) On or before the closing, Buyer shall deliver to Title or
Seller the following:
(i) the balance of the Purchase Price, including the
Additional Purchase Price as provided for in Section VIII in cash,
at closing, less any amounts for which Buyer is to receive a
credit;
(ii) such additional funds as may be required of Buyer to
pay closing costs or charges properly allocable to Buyer.
(d) After Title has received all of the items to be deposited
with it, and when it is in a position to issue the Title Policy
reflected by the approved Commitment, Title shall:
(i) record the Deed;
(ii) record any other instruments executed by the parties,
or either of them, which are contemplated by this Purchase
Agreement to be placed of record, instructing the Recorder's
Office to return the same to the beneficiary thereof;
(iii) issue to Buyer its Title Policy and deliver to Buyer
all other documents to be herein delivered by Seller to the Title
Company pursuant to this Purchase Agreement;
(iv) charge Buyer for the recording cost of the Deed and
one-half of the closing fee and any escrow fees, and the cost of
any purchased title policy;
(v) charge Seller for one-half of the closing fee and any
escrow fees, recording any documents clearing title to the
Property, any abstracting costs and the cost of the title
insurance commitment for Buyer;
(vi) charge Seller for the full cost of any deed transfer,
revenue or similar tax with respect to the sale of the Property;
(vii) real estate taxes and installments of special
assessments due and payable in the year of closing shall be
prorated between the parties based on a calendar year and the date
of closing. Seller shall pay all real estate taxes and
installments of special assessments due in the year prior to the
year of closing and earlier years including as provided in Section
IX(e) hereof; Buyer shall pay all real estate taxes and
installments of special assessments due and payable in the year
subsequent to the year of closing and subsequent years;
(viii) all bills for services, labor, materials, capital
improvements or other charges of any kind or nature rendered to
Seller or the Property prior to the closing date shall be borne by
and paid by Seller;
(ix) prepare closing statements for Seller and Buyer,
respectively, indicating deposits, credits and charges (including
allocation of current real property taxes) and deliver the same,
together with a disbursement of funds, to any appropriate party;
(x) credit Buyer with any applicable security deposits and
prorate between the parties as of the date of closing all rents
and other amounts due under the Leases and operating expenses for
the Property.
Any supplemental closing instructions given by any party shall also be
followed by the Title Company provided the same do not conflict with any
instructions set forth herein.
SECTION XI
DEFAULT BY BUYER
In the event the transactions contemplated hereby fail to close as a result
of a material default by Buyer of any of the terms of this Purchase Agreement,
and such failure to close continues for a period of five (5) days after Seller
notifies Buyer of such event, Seller may, at its option, elect as its exclusive
remedy one of the following:
(a) To terminate this Purchase Agreement as provided for by law
and retain the Deposit as provided in Section III hereof; or
(b) To enforce specific performance of Buyer's obligations herein
to purchase the Property provided such action is commenced within one
hundred eighty (180) days from such failure to close.
SECTION XII
DEFAULT BY SELLER
If Seller refuses to perform any of its obligations as set forth herein or
is in material breach of any of its representations and warranties herein
provided and such failure to perform or breach continues for a period of five
(5) days after Buyer notifies Seller of such event, Buyer may, at its option,
elect one of the following remedies:
(a) To terminate this Purchase Agreement by notice to Seller, in
which event neither party shall have any further rights or obligations
hereunder except that the Deposit exclusive of any interest thereon
shall be returned to Buyer as provided in Section III hereof; or
(b) To enforce specific performance of Seller's obligations
hereunder, including specifically the conveyance of the Property in the
condition required hereby provided such action is commenced within one
hundred eighty (180) days from such failure to close.
SECTION XIII
EXPENSE OF ENFORCEMENT
If either party brings an action at law or in equity to enforce or
interpret this Purchase Agreement, the prevailing party in such action shall be
entitled to recover reasonable attorneys' fees and court costs in addition to
any other remedy granted.
SECTION XIV
BROKERS
Seller warrants to Buyer that in connection with this transaction Seller
has not taken any action which would result in any real estate broker's fee
being due or payable to any party. Buyer warrants to Seller that in connection
with this transaction Buyer has not taken any action which would result in any
real estate broker's fee, finder's fee or other fee being due or payable to any
party. Seller and Buyer respectively agree to indemnify, defend and hold
harmless the other from and against any and all other claims, fees, commissions
and suits of any real estate broker or agent with respect to services claimed to
have been rendered for or on behalf of such party in connection with the
execution of this Purchase Agreement or the transaction set forth herein.
SECTION XV
NOTICE
All notices, demands and requests required or permitted to be given under
this Purchase Agreement must be in writing and shall be deemed to have been
properly given or served either by personal delivery or by the expiration of two
(2) days after depositing the same in the United States mail, addressed to
Seller or to Buyer, as the case may be, prepaid and registered or certified
mail, return receipt requested, at the following addresses:
To Seller: Hillcrest Development
0000 Xxxxxxx Xxxxxx XX
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxxx
With Copy to: Maun & Simon, PLC
0000 Xxxxxxx Xxxxx Xxxxxxxx Xxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx Bans
To Buyer: R & D Systems, Inc.
000 XxXxxxxx Xxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxx Xxxxx, CEO
With Copy to: Xxxxxxxxxx & Xxxxx, P.A.
000 Xxxxxx Xxx. X
Xxxxx 0000
Xxxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Rejection or refusal to accept or the inability to deliver notice hereunder
because of changed address of which no notice was given shall be deemed to be
receipt of the notice, demand or request. Any party shall have the right from
time to time and at any time upon at least ten (10) days' written notice
thereof, to change their respective addresses, and each shall have the right
to specify as its address any other address within the United States of
America.
SECTION XVI
CONDEMNATION
In the event any portion of the Property is condemned or access thereto
shall be taken, or in either case threatened, prior to the closing, and the
taking renders the Property remaining unsuitable for the Buyer's anticipated use
of the Property and Buyer notifies Seller in writing that it wishes to terminate
this Purchase Agreement within thirty (30) days after written notice to Buyer of
such condemnation action, then this Purchase Agreement shall terminate, neither
party to this Agreement shall have any further liability to the other (except
for Buyer's indemnity in Sections IV(a) and V(A) hereof) and Buyer shall be
entitled to a partial refund of the Deposit as described in Section III(b)
hereof.
If the Purchase Agreement is not terminated pursuant to the preceding
sentence, the Purchase Price of the Property shall not be affected, it being
agreed that if the award is paid prior to the closing of this transaction, such
amount, insofar as it pertains to the Property, shall be held in escrow and
delivered to Buyer at the time of closing; and if the award has not been paid
prior to the closing of this transaction, then at the closing Seller shall
assign to Buyer all of its right, title and interest with respect to such award
and shall further execute any other instrument requested by Buyer to assure that
such award is paid to Buyer. If Buyer fails to timely close the transaction and
this agreement is terminated by Seller, any escrowed condemnation proceeds will
be paid to Seller.
If Buyer does not terminate this Purchase Agreement, it shall have the
right to contest the condemnation and/or the award resulting therefrom but such
right shall terminate if Seller terminates this Purchase Agreement as a result
of Buyer's default hereunder. If this Purchase Agreement is not terminated, the
parties shall cooperate in defending any such taking and/or maximizing the
amount of the award. Neither party will take any action relating to the taking,
without the other party's written consent prior to closing.
SECTION XVII
DAMAGE OCCURRING PRIOR TO CLOSING
If, prior to the closing date, all or any part of the Property is
substantially damaged by fire, casualty, the elements or any other cause, Seller
shall immediately give notice to Buyer of such fact and at Buyer's option (to be
exercised with thirty (30) days after Seller's notice), this Purchase Agreement
shall terminate, in which event neither party will have any further obligations
under this Purchase Agreement (except for Buyer's Indemnity under Sections IV(a)
and V(A) hereof) and Buyer shall be entitled to a partial refund of the Deposit
as described in Section III(b) hereof. If Buyer fails to elect to terminate
despite such damage, Seller whether the damage is substantial or not to the
extent reasonably possible shall promptly commence to repair such damage or
destruction to the Property's prior condition and to mitigate further damages
using the qualities of materials and workmanship existing prior to the date of
the casualty. If such damage shall be completely repaired prior to the closing
date, then there shall be no reduction in the Purchase Price and Seller shall
retain the proceeds of all insurance related to such damage. If such damage
shall not be completely repaired prior to the closing date at Buyer's election
(i) Seller shall assign to Buyer all right to receive the proceeds of all
insurance related to such damage, less costs incurred by Seller in mitigating
damage or making repairs that are reimbursable by insurance then in force, and
the Purchase Price shall remain the same or (ii) the closing shall be postponed
pending complete restoration of the damage by Seller. For purposes of this
Section, the words "substantially damaged" means damage that would cost
$2,000,000.00 or more to repair.
SECTION XVIII
VACATION OF SUMMER STREET
If at the date of execution of this Purchase Agreement that part of Summer
Street lying between 2001 Xxxxxxx and 0000 Xxxxxxxx parking lot and the easterly
portion of Xxxxxx Street lying between Xxxxxxx Street and Summer Street has
been or is in the process of being vacated, it is agreed that all of such
vacated street shall accrue to 2001 Xxxxxxx and the parties shall execute and
deliver such deeds as are necessary to accomplish the same. Seller shall pay
the expenses of such vacation except that neither the Seller nor the Buyer
shall have any obligation to pay any sums attributable to the value of any
vacated street which the City may attempt to impose.
SECTION XIX
MERGER/BINDING AGREEMENT
All previous negotiations and understandings between Seller and Buyer or
their respective agents and employees with respect to the transactions set forth
herein are merged in this Purchase Agreement which alone fully and completely
express the parties' rights, duties and obligations. This Purchase Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors, assigns, heirs and personal representatives.
SECTION XX
INTENTIONALLY DELETED
SECTION XXI
GOVERNING LAW
This Purchase Agreement shall be deemed to be a contract made under the
laws of the State of Minnesota and for all purposes shall be governed and
construed in accordance with the laws of said State.
SECTION XXII
ASSIGNMENT
Buyer shall have the right to assign at closing its interest in this
Purchase Agreement, provided that assignee also becomes personally responsible
for Buyer's obligations herein.
IN WITNESS WHEREOF, the parties hereto have executed these presents
intending to be bound by the provisions herein contained.
SELLER: BUYER:
Hillcrest Development R & D Systems, Inc.
By:___________________________ By:_____________________________
Its: General Partner Its: President
ACKNOWLEDGMENT BY TITLE
Title hereby agrees to act as escrow agent pursuant to the foregoing terms,
it being understood that Title shall not be liable to either party if it acts in
good faith in the performance of its duties herein.
First American Title Insurance Company
By:
Its:
EXHIBIT A
LEGAL DESCRIPTION
EXHIBIT B
PERMITTED ENCUMBRANCES
(a) Building and zoning laws, ordinances, state and federal regulations.
(b) Reservation of any mineral or mineral rights to the State of
Minnesota.
(c) Real estate taxes and installments of special assessments due and
payable in the year of closing and subsequent years.
(d) All rights of existing tenants of the Property leased pursuant to
paragraph 7 of the Option.
(e) All matters that would be disclosed by a survey.
(f) Sanitary sewer easement to County of Hennepin recorded as Document No.
1546011.
(g) Declaration of restrictions regarding use of real property where
response actions have been taken pursuant to Minnesota Statutes Sections
115B.01 to 115B.18 recorded as Document No. 2489354.
(h) Affidavit concerning real property contaminated with hazardous
substances recorded as Document No. 2489355.
EXHIBIT C
LIST ENVIRONMENTAL REPORTS
EXHIBIT D
CAPITAL IMPROVEMENTS
