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062606 EDA - Offcial File Copy - CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North June 26, 2006 EDA Meeting will commence upon adjournment of the City Council Meeting President Martin Opem Sr. Commissioner Mary Gwin-Lenth Commissioner Andy Roffe Commissioner Karen Nolte Commissioner Steve Sommer 1. Call to order 2. Ro I1 call ""'I Approval of regular meeting minutes of 1vlay 8, 2006 .:>. 4. Resolution approving and authorizing signing of the purchase and development agreement between Q Village, LLC and the Economic Development Authority in and for the city of NelV Hope;, Minnesota (improvement project no. 740) j. Adjour11ment CITY OF NEW HOPE 4401 XYLON A VENUE NORTH NEV\T HOPE, :MINNESOTA 55428 EDA Minutes May 8, 2006 Regular Meeting City Hall CALL TO ORDER President Opem called the meeting of the Economic Development Authority to order at 8:38 p.m. ROLL CALL Present: Martin Opem Sr., President Ivfary Gwin-Lenth, Commissioner Andy Hoffe, Commissioner Karen Nolte, Commissioner Steve Sommer, Commissioner Staff Present: Dan Donahue, City Manager Kim Green, Community Development Assistant Guy Johnson, Director of Public Works Valerie Leone, City Clerk Kirk McDonald, Director of Community Development Steve SondralI, City Attorney Vince VanderTop, Assistant City Engineer APPROVE MINUTES Motion was made by Commissioner Sommer, seconded by Commissioner Nolte, to approve the Regular Meeting Minutes of April 24, 2006. All present voted in favor. 1\.1otion carried. IMP. PROJECT 795 President Opern introduced for discussiol1 Item 4, Resolution authorizing a Item 4 tI1ir d amendlnent to tIle interim agreen1ent betvveen t11€ Economic Development Authority in and for the city of NeV\7 Hope and PariPassu De\Telopment for the redevelopment of the Bass Lake Road Apartments site, which increases the budget for fees for Krass Monroe, P.A. (improvement project no. 795) President Opem indicated tIle origiIlal agreement capped the financial consultant expenses at $15,000 to be split 50/50 between the city and the developer. He stated the amendment V\7ould autllorize an additional S10,OOO ($5,000 for each party). Commissioners Nolte and Hoffe expressed disappoiI1tmellt that the EDA V\7as not informed of the financial consultant expenditures on March 27 at vvhich time tl1e EDA autI10rized the extension of tIle interim agreement vvith PariPassu. Mr. Kirk McDonald, director of community development, pointed out that staff vvas not a-vvare that the funds \vere depleted until receipt of the April invoice. He explained that the initial agreement called for $25,000 for EDA Meeting Page 1 May 8, 2006 financial expenses but was reduced to $15,000, and covered six months of financial consultant expenses. He emphasized the necessity of additional financial analyses and noted the city is fortunate to have negotiated a 50/50 cost share arrangement vvith the developer. lv1r. McDonald stated staff is optimistic that the project will be feasible, but the financial consultant needs to perform additional financial analysis. He stated Krass Momoe has been working with PariPassu to revise its pro forma to reduce the gap. Commissioner Sommer noted that if PariPassu cannot make the project \,vork, the city "vill o\vn the information and can provide it to other prospective developers. President Opem commented that an additional $5,000 does not appear to be an umeasonable request. EDA RESOLUTION Commissioner Sommer introduced the following resolution and moved its 06-04 adoption: "RESOLUTION AUTHORIZING A THIRD AMENDMENT TO Item 4 THE INTERIM AGREEMENT BETWEEN THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF NEW HOPE AND P ARIP ASSU DEVELOPMENT FOR THE REDEVELOPMENT OF THE BASS LAKE ROAD APARTMENTS SITE, WHICH INCREASES THE BUDGET FOR FEES FOR KRASS MONROE, P.A. (IMPROVEMENT PROJECT NO. 795)." The motion for the adoption of the foregoing resolution "vas seconded by Commissioner Nolte, and upon 'Tote being taken thereon, the following voted in favor thereof: Opem, Gvvin-Lenth, Hoffe, Nolte, Sommer; and the follovving 'voted against the same: None; Abstained: None; Absent: None; \",hereupon the resolution was declared duly passed and adopted, signed by the president which V\ras attested to by the executive director. ADJOURNMENT Motion was made by Commissioner Nolte, seconded by Commissioner G'\vin- Lenth, to adjourn the meeting. All present voted il1 favor. Motion carried. The New Hope EDA adjourned at 8:44 p.m. Respectfully submitted, ~~ Valerie Leo11e City Clerk EDA Meeting Page 2 May 8, 2006 EDA Request for Action Originating Department Approved for Agenda Agenda Section Community Development June 26, 2006 Economic Development Authori Item No. By: Kirk McDonald} Director CD Curtis Jacobsen, CD 5 ecialist 4 Resolution approving and authorizing signillg of the purchase and development agreement betvveen Q Village, LLC and the Economic Development Authority in and for the City of New Hope, Minnesota. (Improvement Project No. 740) Requested Action Staff requests that the Economic Development Authority review, approve and authorize signillg of the purchase and development agreement \vith Q Village, LLC, for the EDA oV\rned site knoV\TTI as 42nd and Quebec. Policy/Past Practice The EDA has entered into purchase and development agreements for the sale of EDA ovvned parcels previously following public hearings as required by law. TIle public hearing for the sale of this piece of property vvas held on June 13, 2005. Background On May 22, 2006, the New Hope City Council gave site plan and preliminary plat approval to the development proposed for 42nd and Quebec. The cit~y attorney and staff have vvorked on negotiating tl1e purchase and development agreement based on the original draft of said document from 2005. The document is in its final form and staff recommends approval. Funding No new funding is required from the EOA related to this project. With the completion of this sale the EDA will receive $510,000.00 for the sale of the land. Attachment(s) . Resolution . Purchase and Devela reement Motion by '-1~ ~6 Second by IA -t/ To: ':j)/~ ib o !.o --C) S- I:\RFA \PLANNING\PLANNING\Q & R - Purchase and Develo ment AQTeement - 42nd and Quebec.doc RESOLUTION NO. 06- Resolution approving and authorizing signing of the purchase and development agreement between Q Village, LLC, and the Economic Development Authority in and for the City of New Hope, Minnesota WHEREAS, the Economic Development Authority of and for the city of New Hope} Minnesota, desires to redevelop the property commonly knovvn as 42nd and Quebec; and WHEREAS, the city has through the Planning Commission and the City Council reviewed the development plans and the plat for the redevelopment of said site; and WHEREAS, the plans and plat for the redevelopment of said site have been found to be acceptable and in compliance with the city's comprehensive plan. NOW, THEREFORE, BE IT RESOL VED, by the Economic Development Authority of and for the city of New Hope, Minnesota, to approve and authorize as follows: 1. Approve the purchase and development agreement for the sale of the property . 2. Authorize the signing of the purchase and development agreement by the President alld the Executive Director of the Economic Development Authority. Adopted by the Economic Development Authority of and for the city of Nevv Hope, Minnesota, this 26th day of June, 2006. President Attest: Executive Director PURCHASE AND DEVELOPMENT AGREEMENT This Purchase and Development Agreement ("Agreement") is made by and bet\veen Quebec Properties, LLC a Minnesota limited liability company ("Buyer") and the ECONOMIC DEVELOPMENT AUTHORITY IN AAT)) FOR THE CITY OF NEW HOPE, MINNESOTA, ("Seller"). In consideration of the covenants and agreements of the respective parties as hereinafter set forth, Seller shall sell and Buyer shall purchase those certain parcels afreal estate located in the City of New Hope and more commonly lmown as 7500 - 42nd Avenue North, 7516 - 42nd Avenue North and 7528 - 42nd Avenue North, which parcels are legally described on Exhibit A attached hereto and made a part hereof (the "Property"). 1. Purchase Price. The purchase price for the Property shall be Five Hundred Ten Thousand and No/IOO Dollars ($510,000.00) (the "Purchase Price"), which the Buyer shall pay as follows: an initial payment of Seven Thousand Dollars ($7,000.00) (the "Earnest Money"), which sum shall be deposited with Old Republic Title Insurance Company (the "Escrow Agent", also referred to hereafter as the "Title Company"), and Five Hundred Three Thousand Dollars ($503,000.00) payable by wire, cashier's check or cash on the "Date of Closing", as that term is defmed in Section 4 below. The Buyer aclmowledges and agrees that, with the exception of termination or cancellation of this Agreement due to breach by the Seller, $5,000.00 of the Earnest Money shall be deemed non-refundable. Seller aclmowledges receipt of the Earnest Money Payment. 2. Title Conveyed. On the Date of Closing, the Seller shall deliver a Limited Warranty Deed (the "Deed") to the Buyer conveying marketable title of record, free and clear of liens, encumbrances, assessments restrictions, except for the "Permitted Exceptions", as that term is defined below. 3. Representations and Warranties by Seller. The Seller represents to the Buyer that: a) The Seller owns the Property and has the right to sell the same, and that there are no unrecorded contracts, leases, easements or other agreements or claims of any third party affecting the lise, title, occupancy or development of the Property, and no person, firm or entity has any right of refusal, option or other right to acquire all or any part of the Property except the following: A Purchase and Sale Agreement executed by Frey Development, Inc. on November 5, 2003, and by the Seller on November 24, 2003, which Agreement relates only to the portion of the Property legally described as "All of the following described parcel except for the West 163 feet thereof: T'hat part of Lot 5, Auditor's Subdivision Number 324, Hennepin County, Minnesota described as follows: Commencing at the point of intersection of the North line of Rockford Road and the East line of said Lot 5; thence North along said East line a distance of 350 feet; thence West parallel with the North line of Rockford Road a distance of 320.4 feet more or less, to a point 48.95 feet East of the West line of said Lot 5, 1 as measured at right angles thereto thence South parallel with the \Vest line of said Lot 5 a distance of 350.0 feet to the North line of Rockford Road; thence Easterly along the North line of Rockford Road a distance of 320.4 feet, more or less to the point of beginning." b) The Seller shall cooperate with the Buyer in the Buyer's efforts to obtain the approval of all public or governmental authorities as to all matters relating to zoning, subdivision, lot splits, special use permits, access, or similar requirements for an approximately 17,400 square foot office and service retail building on the east half of the Property and an approximately 11,500 square foot retail building on the west half of the Property, together with all necessary site improvements upon the Property (collectively, the "Improvements"). For the purposes of this Agreement the Buyer may sell or lease units or spaces within either building. The Buyer shall provide any necessary common interest community or leasehold management documents required to meet all required regulatory arid governmental approvals. Seller shall join in such applications and other documents, including access and parking easements, as may be necessary or required by governmental or regulatory bodies to develop the .Property for the Improvements. Notwithstanding any language in this Agreement to the contrary, Seller's obligations under this Section 3(b) shall not be construed to limit in any way the reasonable exercise of the discretion of the City of New Hope in considering any submittal or application relating to development of the Property. c) The Seller's warranties and representations contained in this Subsection 3 shall survive the delivery of the Deed. d) The Property is subject to a Declaration of Environmental Restrictive Covenants dated November 24, 2003, which Declaration is recorded with the Office of the Hennepin County Recorder as Document Number 8298194 (the "Environmental Restrictive Covenants"). The Seller has not received any notice from any person or entity as to a breach of the terms contained in the Environmental Restrictive Covenants. e) The Seller has not received any notice from any governmental authority concerning any eminent domain, condemnation, special taxing district, or rezoning proceedings. f) The Property is not subj ect to any assessment or valuation agreement that is not listed as one of the Permitted Exceptions, as defined in Section 4 below, and the Seller has not received any notice of actual or threatened special assessments or reassessments of the Property. g) To the best of the Seller's knowledge without inquiry there are no wells or septic systems on the Property, except for such existing environmental monitoring wells installed and maintained by Seller. 2 h) Seller represents that it has the requisite power and authority to enter into and perform this Agreement and those Seller's Closing Documents signed by it; such documents are not in violation of any judgment, order or decree of any Court or arbitrator to which Seller is a party and such documents are and will be valid and binding obligations of Seller, and are enforceable in accordance with their terms. i) Seller is not a "foreign person," "foreign partnership," "foreign trust" or "foreign estate" as those terms are defined in Section 1445 of the Internal Revenue Code. j) Except as previously disclosed to the Buyer, the Seller has not received notice of any action, litigation, investigation, condemnation or proceedings of any kind pending or threatened against Seller or any portion of the Property. k) To the best knowledge of Seller without inquiry, no above ground or underground tanks are located in or about the Property. The Seller agrees that any breach of the forgoing representations shall be grounds for Buyer to terminate this Agreement. In the event of such termination, the Earnest Money shall be returned.. YVherever herein a representation is made "to the best knowledge of Seller," such representation is limited to the actual knowledge of the President and/or Executive Director of Seller. NOTWITHSTAAllING THE FOREGOING REPRESENTATIONS BY THE SELLER, THE BUYER HEREBY ACKNOWLEDGES THAT THE BUYER IS PURCHASING THE PROPERTY IN "AS IS" CONDITION. 4. Conditions of Offer. The Buyer's obligation to close the transaction contemplated by this Agreement is subject to the satisfaction of the following conditions on or before August 14 , 2006: a) The Buyer shall, pursuant to the terms of Section 7. below, have reasonably determined that the Property is marketable. In making such determination the Buyer specifically agrees and acknowledges that title to the Property is currently, and if the Buyer proceeds with closing will be, subj ect to the following title . matters (collectively, the "Permitted Exceptions"): (i) any lien afreal estate taxes not yet due and payable in 2006; (ii) rights-of-way for drainage ditches, drain tiles, feeders, laterals and underground pipes, if any; (iii) all dedicated rights-ofway; (iv) the Environmental Restrictive Covenants; and 3 (v) . all other easements, restrictions, covenants and agreements which are depicted by the public records, so long as the Buyer's intended use of the Property is not materially impaired by such matters of record as determined by the Buyer in Buyer's reasonable discretion. The Buyer agrees and aclmowledges that for the purposes of this Agreement the Environmental Restrictive Covenants shall not be considered to "materially impair" the Buyer's intended use of the Property. b) Obtaining approval for ingress and egress to the Property and all zoning changes, including rezoning, variances, special use permits, subdivisions and any other governmental permits, consents and authorizations, which are necessary or desirable for Buyer's intended use of the Property, including, without limitation, final building permits. c) Obtaining financing under terms and conditions reasonably acceptable to the Buyer. d) The Buyer and the Seller agreeing to reasonable terms and provisions for cross easements in favor of the Buyer for construction and maintenance of access and parking, which easements shall additionally provide for shared access and parking for all owners and tenants of the Property. e) Reasonably acceptable direct access to and from the Property via publicly dedicated streets. If any condition of this Section 4 remains unsatisfied or has not been waived by the Buyer on or before August 14, 2006 or the date of closing, whichever occurs sooner, this Agreement shall become null and void, neither party shall have any further obligation to the other under this Agreement (other than rights or obligations under this Agreement which provide for continued exercise following the cancellation or other termination of this Agreement), and $2,000.00 of the Earnest Money shall be refunded. With respect to the above-described conditions in favor of the Buyer, the Buyer shall give notice of its desire to terminate this Agreement for failure to satisfy or fulfill any of said conditions on or before August 14, 2006, or the date of closing, whichever occurs sooner, but ifno notice of termination is given within the specified time period with respect to any of the conditions listed above, such condition shall be deemed to be waived by the Buyer and the Buyer shall proceed to close this transaction in accordance with the other terms and conditions of this Agreement. The Buyer hereby aclmowledges that the Buyer has been fully informed of the ground water and soil contamination existing on the Property and has had ample opportunity to investigate and inform itself regarding these circumstances. The Buyer further acknowledges that this contamination does not render the Property Unsuitable for development in connection with the Buyer's intended use of the Property. 5. Survey and Plat. The Seller has previously delivered" to the Buyer a survey of the Property (the "Survey"). The Buyer acknowledges receipt of the survey and agrees and acknowledges that the same was prepared by a duly licensed surveyor in accordance with the current minimum standard detail requirements for ALTNASCM land title surveys. The Buyer agrees that the Survey shall be used for preparation of the final plat of the Property, and agrees to 4 pay all costs related to platting the Property. The Seller agrees, however, to assist with final platting activities as needed. The obligations of the Buyer and Seller regarding platting shall survive the Closing and the delivery of the Deed. 6. Access Prior to Closing. The Buyer and its employees, agents, and contractors shall have the right to enter upon the Property for the purpose of conducting examinations, making measurements, and performing such tests or surveys thereon (including soil borings) as the Buyer desires. The Buyer's access to the Property and actions thereon shall be subject to Seller's approval, the approval of the Minnesota Pollution Control Agency and, if requested by the Seller, a written access agreement which will not materially interfere with the Buyer's testing and inspection of the Property. The Seller agrees not to unreasonably withhold its approval for Buyer to have access to the Property. The Buyer agrees to promptly repair or restore any damages caused by the Buyer or its employees, agents, or contractors during the course of making such examination, measurements or tests, with repairs to be performed in any reasonable manner specified by the Seller or the Minnesota Pollution Control Agency and the Buyer further agrees to indemnify and hold the Seller (and the Seller's employees, agents, consultants and officers) harmless from and against any lien, claim, loss, liability, cost, damage or injury asserted against or suffered by the Seller or the Property, including but not limited to attorneys' fees, related to any entry by the Buyer, its assigns or any of its agents, representatives, contractors or employees, as related to this Agreement. The repair and indemnification obligations recited in this Section 6 shall survive closing or the cancellation or other termination of this Agreement. 7. Title Commitment and Policy. a) The Seller shall deliver to the Buyer a Commitment for an ALTA Form B owner's policy of title insurance (the "Commitment") issued by the Title Company and covering title to the Property, in the amount of the Purchase Price. The Seller agrees . to pay the costs associated with the preparation and issuance of the Commitment; the Buyer shall pay the premium for the owner's policy, if any, and the lender's policy, if any, along with the price for any endorsements requested by the Buyer or the Buyer's lender. b) The Buyer shall have fifteen (15) days after receipt of the Commitment to review and approve the title to the Property and to object to any exception to title that is disclosed in the Commitment and Surveyor which is otherwise discovered by the Buyer. In the event that the Buyer does not within such fifteen (15) day period give notice to the Seller objecting to any such exceptions, then all such exceptions shall be deemed approved and shall be considered a part of the Permitted Exceptions. lfthe Buyer timely objects to an exception to title, then on or before the tenth (10) day following the Buyer's notice of exception, the Seller shall remove the exception or notify the Buyer that the Seller is unwilling or unable to remove the exception. Within five (5) days of any notice by the Seller that the Seller it is unable to remove an exception to title, the Buyer may elect by notice to the Seller to either: 5 (i) terminate this Agreement, whereupon $2,000.00 of the Earnest Money shall be returned to the Buyer and the parties shall be released from all further obligations hereunder except obligations under this Agreement which provide for cont~ued exercise following the cancellation or other termination of this Agreement; or (ii) elect to have this Agreement remain in effect, in which event the Buyer will be deemed to have approved the previously-cited exception and the same shall be considered part of the Permitted Exceptions. 8. Closing. a) Closing shall occur within ten (10) business days after all the conditions of the Agreement have been satisfied, and in no event later than August14, 2006 (the ''Date of Closing" or "Closing"), unless both parties~ agree, in writing, to. an earlier or later time. b) Closing shall, at the Seller's sole option, occur at the Escrow Agent's office, the Seller's office, or the office of the Seller's attorney. c) The Seller shall deliver at closing the following executed and acknowledged documents: (i) the Deed; (ii) affidavit(s) in industry-standard formes) stating that possession of the Property is being delivered free of any mechanic's or statutory liens in connection with Y"vork performed prior to closing; the Seller is not a foreign person or entity; and addressing such other matters as the Buyer may reasonably require; and ( iii) a Cancellation of Purchase Agreement, in form reasonably acceptable to the Buyer, terminating the agreement between the Seller and Frey Development, Inc. cited in Subsection 3(a) above with respect to a portion of the Property; (iv) easement or easement agreements as outlined in Section 4( d) above; (v) an Assignment of the Environmental Restrictive Covenants; and (vi) A "bring down certificate" in a form substantially similar to that attached to this Agreement as Exhibit B. d) The Buyer shall deliver at closing the following executed and acknowledged documents: 6 (i) a Cancellation of Purchase Agreement, in form reasonably acceptable to the Buyer, terminating the agreement between the Seller and Frey Development, Inc. cited in Subsection 3(a) above with respect to a portion of the Property; (ii) easement or easement agreements as outlined in Section 4( d) above; and ( iii) an Assignment of the Environmental Restrictive Covenants. 9. PaymentslProrations. The Seller shall, on or before the Date of Closing, pay for the costs relating to the Commitment. At closing, the Seller shall pay the cost of recording any instrument (other than the Deed) necessary to place title in the condition required under this Agreement, State deed tax, and all special assessments levied, pending or constituting a lien against the Property as of the Date of Closing, including without -limitation any installments of special assessments and interest payable with general real estate taxes in the year of closing. The Seller will pay general real estate taxes payable in the year prior to the year of closing and all prior years. The Buyer shall pay at closing the cost of the owner policy or lender policy of title insurance (if any), sales tax (if any) resulting from the Closing, and the fees required for recording the Deed. The Seller and the Buyer each will pay one-half of customary closing fees. General real estate taxes payable in the year of closing shall be prorated by the Seller and the Buyer as of the closing date based upon a calendar year. 10. Condemnation. If, prior to the Date of Closing, all or any part of the Property shall be condemned by governmental or other lawful authority, the Buyer shall have the option of (a) completing the purchase contemplated by this Agreement, in which event all condemnation proceeds or claims thereof shall be assigned to the Buyer, or (b) canceling this Agreement, in which event the Earnest Money shall be refunded and this Agreement shall be terminated with neither party having any rights against or obligations to the other except rights or obligations under this Agreement which provide for continued exercise following closing or cancellation or other termination of this Agreement, and the Seller shall be entitled to any and all condemnation proceeds. 11. Notices. All notices required hereunder shall be in writing and shall be deemed to have been duly given and received (a) hvo (2) business days after depositing of the same in the mail if sent by regular, registered or certified mail, postage prepaid, to the party to whom directed, at such party's address herein set forth; (b) upon delivery, or attempted delivery if delivered by overnight courier service or hand delivery; (c) or upon transmission if successfully transmitted by facsimile. Any party shall have the right to designate any other address or facsimile number for notice pUl.}Joses by written notice to the other party in the manner aforesaid. The addresses of the parties are as follows: 7 SELLER: City of New Hope Dan Donahue, City Manager 4401 Xylon Avenue North New Hope, MN 55428-4898 Facsimile No.: 309-688-9099 with copy to: Steven Sondrall, New Hope City Attorney Jensen & Sandrall, P .A. 8525 Edinbrook Crossing, Suite 201 Brooklyn Park, MN 55443 Facsimile No.: 763-493-5193 BUYER: Brad Nordgaard Quebec Properties, LLC 1915 Plaza Drive, Suite 201 Eagan, MN 55122 Facsimile No.: (651) 289-5531 with copy to: Richard A. Glassman Glassman Law Firm 701 Fourth Ave. S., Suite 500 Minneapolis, MN 55415 Facsimile No.: 763-544-6427 12. Broker. The Buyer represents and warrants that it will pay all brokerage charges incurred in connection with this transaction as a result of activities authorized by the Buyer, with all such charges that have been i~voiced as of the Date of Closing to be paid at Closing. In addition, Buyer will pay at Closing a special one-time consulting fee of $30,000.00 to the consultant(s) named by the Seller as performing prior retail analyses and tenant marketing. The fees and commissions required by this Section 12 shall be paid at the Closing, and not sooner. T'he Buyer obligations recited in this Section 12 shall survive the Closing or the cancellation or other termination of this Agreement. Buyer represents that the principal of Buyer is a licensed real estate broker. 13. Remedies. If the Buyer defaults under this Agreement, the Seller shall have the right to terminate this Agreement by giving written notice to the Buyer as provided by law. If the Buyer fails to cure such default as provided by law, this Agreement will terminate, and upon such termination the Seller will retain the Earnest Money and neither party shall have any rights or obligations against the other except rights or obligations under this Agreement which provide for continued exercise following the cancellation or other termination of this Agreement. If the Seller defaults under this Agreement, the Buyer shall have the right to seek specific performance and recover as damages from the Seller all of the Buyer's reasonable out-of-pocket costs and fees or terminate the Agreement and receive the Earnest Money paid to the Escrow Agent. 8 14. MPCA VIC Application and Letter. The Seller shall apply for and obtain written assurance from the 1v1PCA that the Buyer is not responsible for cleanup of the hazardous materials that remain in the undisturbed soil and water of the Property (a "No Association" assurance letter). This letter is to be obtained through application to the -Minnesota Pollution Control Agency ("1v1PCA") Voluntary Investigation and Cleanup ("VIe") pro gram. Notwithstanding the foregoing language, the Seller shall have no responsibility for applying for a "No Association" assurance letter in the event that the Buyer fails to provide the Seller, a sufficient period before the Date of Closing, with the "Required Information" (as that term is defined below). The Seller's failure to provide a "No Association" assurance letter in accordance with the provisions of this Section 14 shall be grounds for the Buyer to terminate this Agreement. In the event of such termination, the Earnest Money shall be returned and neither party shall have any rights against or obligations to the other except those rights or obligations under this "" Agreement which provide for continued exercise following the 'cancellation or other termination of this Agreement. 15. Required Information. The Buyer is required to provide the Seller, consistent with Section 14 above, with the following information at the Buyer's sole expense so that the Seller can complete the VIe application (the "Required Information"): a) Site plan and associated text describing the nature of business activities anticipated after redevelopment, including activities from which Buyer wishes to obtain 1v1PCA "No Association" letter(s); b) Grading plan; c) Geotechnical drilling and/or soil testing plan; d) Subsurface utilities plan; e) Monitoring and Maintenance Plan: f) Restoration Plan; g) Vapor collection system design drawings; h) Construction time line; and i) Any other information required for the completion of the VIe application that the Buyer otherwise needs to prepare in connection with its development of the Property. The Buyer's failure to prov~ide the Required Information in accordance with the provisions of this Agreement shall be grounds for the Seller to terminate this Agreement. In the event of such termination the Seller shall be allowed to retain the Eamest Money and neither party shall have 9 any rights against or obligations to the other except those rights under this Agreement which provide for continued exercise following the cancellation or other termination of this Agreement. Prior to initiating any earth-moving activities, Buyer shall provide Seller a copy of the 1vfPCA- required Storm Water Pollution Prevention Plan (SWPPP) for City review and approval. Buyer shall be responsible for compliance with all federal, state and local regulations regarding construction storm water, including obtaining a 1vfPCA Construction Storm Water permit. All on-site work performed by Buyer or its employees, agents or contractors shall be performed in accordance with 29 CFR 1910.120. Buyer shall be responsible for all site safety programs for Buyer or its employees, agents or contractors. 16. Environmental Monitoring During Construction. The parties aclmowledge that an- site monitoring of certain construction activities by an environmental professional designated by Seller (the "EP") will be required after closing. Seller shall be responsible for the cost o-f the EP. Both parties agree, consistent with the requirements of this Agreement, to provide and pay for their own field environmental technician (the FET") prior to the start of earth-moving activities at the site. Both FET's must be on-site during: a) Grading activities near the Restricted Area (as defined in the Environmental Restrictive Covenants); b) Subsurface excavation of utilities; c) Dewatering of excavated areas due to the presence of subsurface water or as a result of unusual rainfalls during construction that inundate the area; d) Installation and startup of vapor collection system; and e) Geotechnical drilling and/or soil testing activities. Both FET~s will monitor excavated soils and accumulated waters for the presence of contaminants. If contaminated soils are detected, and the Buyer's FET determines that the soils cannot reasonably be reused within the excavated area, the contaminated soil will be stockpiled by the Buyer separately from clean soils, and the contaminated soils will be removed from the Property for disposal at a facility agreeable to the Seller's EP. If Buyer's FEr determines accumulated waters are contaminated, the Buyer will arrange adequate means and methods of cleanup or disposal, agreeable to the Seller's EP, which may include discharge of such waters into Seller's storm water or sanitary sewer systems. At the conclusion of on-site monitoring activities, the Seller's FET will provide a letter report to both the Seller and the Buyer summarizing the Seller FET's activities and observations. The Buyer aclmowledges and agrees it has sole responsibility for all decisions relating to the reuse or disposal of contaminated soils and water at the Property in compliance with the 1vfPCA's restrictive covenants and all other MPCA regulations. Seller's obligations under this Section shall be limited to monitoring and reporting as referenced above. Both parties' obligations under this Section 16 shall survive delivery of the Deed. 10 17. Environmental Monitoring Costs and Responsibilities. The Buyer shall be responsible for providing the Seller with reasonable notice of the activities outlined in Section 16 so that the Seller will be able to provide an appropriate FET. Buyer shall be responsible for all costs associated with the stockpiling, remediation, removal, and/or eventual off-site disposal of contaminated soils and waters at the Property in compliance with the 1YIPCA's restrictive covenants and all other :MPCA regulations. The Buyer's obligations under this Section 17 shall survive delivery of the Deed. 18. Permanent Environmental Monitoring and Maintenance. Any permanent structures erected at the Property that will be occupied by workers of any kind must have a subsurface vapor collection system designed and installed beneath the structure to collect potential organic vapors and prevent such vapors from accumulating in the structure. The vapor collection systems must be "active" vapor collection systems (i.e. electrical fans will continuously draw air from the collection system and discharge the air, through roof vents). A vapor collection system implementation work plan shall be developed by the Buyer in conjunction with the EP, and then reviewed and approved by the :MPCA prior to installation of the system. The work plan shall include a detailed system design, and a monitoring and maintenance plan for the system. Buyer shall be required to monitor and maintain the system on an ongoing basis and shall be designated as the party responsible for said obligations in the monitoring and maintenance plan. All monitoring wells within the Property shall be continuously maintained by Seller before construction activities and Buyer shall have no responsibility or costs associated with such permanent monitoring well systems other than damage to, relocation of or abandonment of monitoring wells during and after construction activities. However, Seller agrees to provide Buyer with any of Seller's unused grant money from its Hennepin County Environmental Response Fund (EFP) grant for qualifying expenses of Buyer relating to well abandonment and/or relocation. The Buyer and Seller obligations under this Section 18 shall survi"ve delivery of the Deed and shall be included in the Deed. 19. Future Access and Utility Easements. The Buyer hereby represents and warrants that the Buyer will, if requested by the City of New Hope, provide the City with access and utility easements in connection with the Buyer's future development of the Property and as provided for by New Hope's City Code, regulations and past practices. The Buyer further represents and warrants that any such easements shall be provided at no cost to the City. The Buyer representations and warranties contained in this Section 19 shall survive delivery of the Deed. 20. Assignment. The Buyer may assign its rights and obligations hereunder only with the prior written consent of the Seller, which consent may be granted or withheld by the ,Seller in its sole discretion. 21. Post-Closing Construction/Revesting of Title. The Buyer agrees and covenants that the Buyer will construct, or cause to be constructed, on the Property all structures necessary for the Improvements, with materials and plans to coincide with those approved by the City of New Hope as part of the governmental approval process cited in Subsection 3(b) above. This covenant shall survive the delivery of the Deed. Construction of the Improvements must be substantially completed within 180 days after construction is commenced on either of the buildings that comprise the Improvements. Buyer shall commence construction on each building 11 and the entire site improvements when 50% of either building is either pre-leased or pre-sold, but in no case later than , 20_, If the Improvements are constructed in two phases, the covenant contained herein shall apply separately to each building. Construction will be considered substantially complete when a final certificate of completion has been issued for each building of the Improvements. Promptly after substantial completion of the Improvements the Seller will at the request of the Buyer provide the Buyer with a certificate of completion in form and substance reasonably acceptable to the Buyer. Said certificate shall be (and it shall be so provided in the Deed and in the certificate itself) a conclusive determination of satisfaction and termination of the agreements and covenants of the Buyer (and its successors and assigns) to construct the Improvements and satisfaction of the date(s) for completion thereof. If the Seller shall refuse or fail to provide a certificate as required by this Section 21 then the Seller must, within thirty (30) days after written request by the Buyer, provide the Buyer with a written statement outlining in reasonably adequate detail the reasons that the Seller is of the opinion that the Buyer has failed to complete the Improvements in accordance with the provisions in this Agreement, or the reasons the Seller is of the opinion that the Buyer is otherwise in default. A writing required of the Seller under this Section 21 must additionally outline the measures or acts that will be necessary, in the opinion of the Seller, for the Buyer to take or perform in order to obtain a certificate of completion, The Buyer agrees and acknowledges that in the event of an uncured default with respect to the Buyer's obligations to construct the Improvements the Seller may, pursuant to the terms outlined in Exhibit C attached hereto and made a part hereof, declare that all rights and interests in and to the Property (including to improvements or rights subsequently added to the Property after closing of the transaction contemplated by this Agreement) shall revert to the Seller. 22. Miscellaneous. This Agreement shall be governed by the laws of the State of Minnesota. No amendment of this Agreement shall be valid or binding unless executed by authorized representatives of both the Seller and the Buyer. The headings and captions of this Agreement are for the convenience of the parties only and shall not be looked to in the interpretation or enforcement of this Agreement. The Seller and the Buyer acknowledge and agree that each has had opportunity to participate in the drafting oftrus Agreement and accordingly acknowledge and agree that this Agreement as a whole and each of is clauses are not to. be interpreted in favor of or against either party. This Agreement may be signed in counterpart, with each copy of the Agreement binding upon the signing party at the time of signing and together which shall constitute a single document. 23. Restaurant within Improvements. Notwithstanding anything herein to the contrary, Buyer agrees to use reasonable commercial effort~ to locate a casual dining restaurant, reasonably acceptable to the New Hope City Council in its sole discretion, to be contained within 2,000 or more square feet of either building for a period of one (1) year after the closing. At anytime thereafter, the Buyer shall not be obligated to place a restaurant in the Property. In the event Buyer cannot locate an acceptable restaurant at the Property, Buyer shall pay to the Seller an additional $15,000.00 for purchase of the Property. For purposes of this section, locate shall mean Buyer has entered into a written lease with a restaurant for a period exceeding one year or sold a portion of the Property pursuant to a purchase agreement entered into within one year to a restaurant. Buyer agrees to provide Seller with a copy of the lease or purchase agreement. Buyer agrees to provide Seller with an irrevocable one year letter of credit or some other form of 12 financial guarantee reasonably acceptable to Seller on or before the date of closing in support of its agreement to locate an acceptable restaurant at the property in compliance with this section. This section shall also survive the delivery of the deed. 24. Whenever a period of time is herein provided for either party to do or perform any act or thing, that party shall not be liable or responsible for any delays due to strikes, riots, acts of God, shortages of labor or materials, national emergency, acts of a public enemy, governmental restrictions, laws or regulations, or any other cause or causes, whether similar or dissimilar to those enumerated, beyond its reasonable control and the time to do or perform such act or thing shall be extended for the period of delay. [The Remainder of this Page is intentionally Left Blank; Signature Page(s) Follo,v] 13 IN WITl\TESS WHEREOF, the parties have executed this Agreement effective as of the latest date indicated below ("Effective Date"). SELLER: BUYER: ECON011IC DEVELOPMENT AUTHORITY ill AL~D FOR THE CITY OF NEW HOPE Quebec Properties, LLC By: Martin E. Opem Sr. By: Its: President Its: Dated: , 2006. Dated: , 2006. By: Daniel J. Donahue Its: Executive Director Dated: , 2006. 14 EXHIBIT A Lee-al Description That part of Lot 5, Auditor's Subdivision Number 324, Hennepin County, Minnesota described as follows: Commencing at the point of intersection of the North line of Rockford Road and the East line of said Lot 5; thence North along said East line a distance of350 feet; thence West parallel with the North line of Rockford Road a distance of320.4 feet more or less, to a point 48.95 feet East of the West line of said Lot 5, as measured at right angles thereto thence South parallel with the West line of said Lot 5 a distance of 350.0 feet to the North line of Rockford Road; thence Easterly along the North line of Rockford Road a distance of 320.4 feet, more or less to the point of beginning. 15 EXHIBIT B Insert form of Bring Dovro. Certificate 16 EXffiBIT C [insert EDA's standard right of reversion language] P:\Attomey\SAS\l Client Files\2 City of New Hope\99-20509( 42nd and Quebec )\Purchase Agreement D5- clean. doc . . 17