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2001 04 29FIt.F~ COPY Agenda Economic DeVelopment Authority Monday, April 29, 2001, 7:00 p.m. Chanhassen City Hall, 7700 Market Blvd. Consider Approval of Purchase Agreement Regarding the Potential Sale of Lots 2 & 3, Block 1, Crossroads Plaza 3rd Addition. 2. Verbal Update on the Chanhassen Bowl Property. CITYOF CH SEN ??00 Mart:et Boulevard PO Box 147 ChanhasEen. MH 55317 Admioistralion Phone: 952.227.1100 Fax: 952.227.1110 Building Ins~e~lions Engineering P'~?: ~52 2271160 ~z:, %2.227.1 i70 Finance Park & Recrea[io~ ~hone: 952 2~7.1~03 ~.,,: ::,~.zzZ.l~O~ Planning & Nalural Resources Phsn~: 952.227.I ~ 30 F~:: 952227.1 ~ 10 Public Works S~nior ~enler P~ione: 952.227.ii25 Fax: 952.227.1110 Web Site MEMORANDUM TO: FROM: DATE: SUB J: Mayor City Council Todd Gerhardt, City Manager April 26, 2002 Public Hearing Regarding the Potential Sale of Lots 2 & 3, Block 1, Crossroads Plaza 3rd Addition Under state statutes, the City of Chanhassen must hold a public heating when considering the sale of city owned land. Attached you will find a proposed purchase agreement with Infinity of Chanhassen, LLC proposing to build a $1.2 million mixed use retail building with 12,480 square feet. The significant terms and conditions of the purchase agreement are as follows: 1. Purchase Price: $8.80 per square ft. (80,175.20 sq. ft. x $8.80) = $705,000 2. Earnest Money: $10,000 3. Closing: Scheduled for October 1, 2002. 4. Site Plan: Approve by City Council by July 15, 2002. 5. Real Estate Commission: To be paid by the buyer. Listed below is the "Economic Status Report" which highlights the city's holding costs compared with the proposed revenue derived from the sale of the property based on development of a ~2,480 sq. ft. mixed use retail building. The City of Chanhassen, '-, ~r3,', ng scn-n',.A,¥ ,', :r~ c!,z? i.3;es qL;afi;!,, SChO0iS. a charming do,,'.ntov,'n, thrivfng businesses, v,,indiog tFails, and beaulilul parks ,~, g¢ea[ place to live. v,'ork and pla:,, HOLDING COSTS Economic Status Report I Purchase Price: $1.50 per sq. foot X 80,175.20 sq. feet = I $120,262.80 · The HRA purchased the property approximately 11 years ago at $1.50 per sq. foot X 80,175.20 sq. feet Special Assessments: $2.12 X 80,175.20 sq. feet = I $169,971.421 · Special Assessments against the site are $2.12 X 80,175.20 sq. feet [SUB-TOTAL I $290,234.22 ] I Misc. Expenses $.60 X 80,175.20 sq. feet = [ $48,105.12 · Miscellaneous expenses include detention pond land, wetland relocation, platting costs, soil borings, etc. X .60 per sq. foot I TOTAL FOR HOLDING COSTS I $338,339.34 I REVENUES Proposed Selling Price $8.79 per sq. foot X 80,175.20 sq. feet = I $705,000.00I I Taxes Income generated annually I $48,360.00 Building Permit Fee Permit fees, park/trail fees, hook-ups, etc. I Est $35,000 I TOTAL REVENUES I $783,360'001 Summary Assumption #1 REVENUE Taxes, building permit fees, utilities, etc. $783,360.00 HOLDING COSTS -$338,339.34 TOTAL $450,020.66 Summary Assumption #2 REVENUE (Land only) $705,000.00 HOLDING COSTS -$338,339.34 TOTAL $366,660.66 RECOMMENDATION Based on the Economic Status Report, staff would recommend approving the purchase agreement with Infinity of Chanhassen, LLC for the sale of Lots 2 and 3, Block 1 Crossroads Plaza 3rd Addition. ATTACHMENTS 1. Public Hearing Notice 2. Purchase Agreement 3. Concept Plan g:Xadmin\tg\crossroads land salel .doc NOTICE OF PUBLIC HEARING CITY OF CHANHASSEN Notice is hereby given that the City of Chanhassen City Council will hold a public hearing on Monday, April 29, 2002 at 7:00 p.m., 7700 Market Boulevard. The purpose of this hearing is to consider the disposal of certain tracts of land to wit: Lots 2 and 3, Block 1, Crossroads Plaza 3rd Addition (550 and 570 West 79th Street) The hearing is being conducted in accordance with the provisions of Minnesota StatUtes Section 469.029. A plan showing the location of the proposal is available for public review at City Hall during regular business hours. All interested persons are invited to attend this public hearing and express their opinions in regard to this proposal. Todd Gerhardt, City Manager 952-227-1119 (Publish in the Chanhassen Villager on April 18, 2002) u,, ~u,~uu~. ±o.~v ~AA vS1452555U CA/~IFDELL ~NUISON PA [~]002/027 REAL ESTATE PURCHASE AGREEMENT THIS AGREEMENT (the "Agreement") made and entered into this __ day of ., 2002, by and between INFINITY OF CHANHASSEN, LLC, whose address is (referred to herein as the "Buyer"), and the CITY OF CHANHASSEN, a murdcipal corporation under the laws of the State of Minnesota, w/th offices at 690 City Center Drive, P.O. Box 147, Chanhassen, Minnesota 55317 (referred to herein as the "Seller"). IN CONSIDERATION of the mutual covenants and agreements herein, it is hereby mutually agreed by Seller and Buyer as follows: SECTION 1. SALE AND PURCHASE OF LAND 1.1) Seller shall sell to Buyer and Buyer shall purchase 'from Seller, upon the terms and conditions hereof, the following property (all collectively refen'ed to as the "Subject Property"): 1.1.1) The laud in Carver County, Minnesota, legally described as follows: Lots 2 and 3, Block 1, Crossroads Plea 3rd Addition, according to the plat thereo£on file and of'record in the Office of the County Recorder and/or the Office of the Registrar of Tires of Carver County, Minnesota. SECTION 2. PURCHASE PRICE 2.1) The purchase price for the Subject Property (the "Purchase Price") shalI be the sum of Seven Hundred Five Thousand and No/100 Dollars ($705,000), and shall be payable by Buyer to Seller as £olloxvs: 2.1.1) Ten Thousand Dollars ($10,000.00) earnest money ("Earnest Money"), to be deposited wifl~ the Seller and reid by the Title Company (hereinafter defined) in an interest-bearing account reasonably acceptable to Buyer. The Earnest Money and all ~oo~2s v_g2 - 1- ] 04/25/2002 15:26 FAX 6514525550 CA~IPBELL KNUTSON PA ~003/027 interest accrued thereon shall be applied (i) against the Purchase Price at Closing, or (ii) as liquidated damages and as Seller's sole remedy, in the event the Seller performs all of its obligations under this Agreement and Buyer fails to close as required in this Agreement. The Earnest Money and all accrued interest thereon shall be returned to the Buyer in the event of (i) refusal of the Seller to perform its obligations under this Agreement, or (ii) Buyer's termination of this Agreement within the Contingency Period, as hereinafter set forth. 2.1.2) The balance of the Purchase Price in cash on the date of Closing_ 2.1.3) In addition to the foregoing, Buyer shall pay at Closing the amount set forth in the "Amendment to Declaration of Restrictions to Revise Exhibit A" as set forth in 4.6.4 hereof. SECTION 3. TITLE MATTERS 3.1) Seller shall cause to be furnished to Buyer-within c,~ ........ ~,~' 5-)-d~_, ...... .. after gep~abcr~ on or before May_l 5., 2002, a current commitment for the issuance of an ALTA Form B (1990) owner's policy of title insurance (the "Commitment") issued by Chicago Title Insurance Company by its agent Carver County Abstract and Title Company, Inc. ("Title Company") in the proposed amount of the Purchase Price, conunitting to insure that Buyer will have good and marketable title to the Subject Property, subject to the following easements, declarations, restrictions and encumbrances affecting the Subject Property which shall be reviewed and approved by Buyer on or be:fore June 15, 2002.: (a) "Declaration of Cross Access, Utility and Parking Easements"; (b) "Declaration of Restrictions" (as amended to Buyer's satisfaction); (c) "Parking and Access Easement Agreement"; (d) permmmnt and temporary easements currently of record; (e) standard exceptions to title; (f) zoning and all other govermnental ordinances, regulations, requirements and laws; and (g) except matters to which Buyer may consent in writing. Buyer shall have_(l~ fifteen (I 5) days after Buyer's receipt of.t-he ~-+.~..,, ,,,.~*' ~rl-) the Connnitment, and (2) fifteen (1_~5 days after Buyer's receipt of the Survey defined in Section 3.3 hereof, to make any objections to the matters disclosed in the Commitment and/or ] o022sv2 -2- 04/2a/2002 15:26 FAX 6514525550 CA~IPBELL KNUTSON PA ~004/027 Survey. Such objections to be made in writing or deemed to be waived. The Commitment shall show all matters affecting title to the Subject Property, with copies of all instrmnents referenced therein, and shall bind the Title Company to issue to and in favor of Buyer at Closing an owner's policy of title insurance insuring marketable title to the Subject Property, affirmatively insuring any appurtenant easeme]ats, deleting the standard exceptions upon receipt of the Survey and the title affidavit, and containing such endorsements as Buyer requires, including, without limitation, 3.1 zoning (ir~eluding parking) endorsement, comprehensive endorsement, separate tax lot endorsement, access endorsement, usury, and survey endorsement. Copies of the restrictious, cove~.~m2ts and declarations (without amendmen.t) referred to in (a), Co) and (c) are attached hereto. 3.2) In the event any exceptions are listed in the Conm2itment other the items listed in Section 3.1(a), (b), (e), (d), (e)~ (f) and (g), if the same results from any volm~tary action by the Seller, or if the same relates to any lien or encumbrance of a monetary nature, which can be removed by payment of an amount up to the Purchase Price at closing, the Seller shall cause the exception to be removed On or before the Closing Date. With regard to any other exceptions or objections to title or the Survey, if the Seller fails to remove the same within the time allowed for closing on the Subject Propmty, the Buyer shall have as its sole rmnedy the right to terminate this A~eement and receive a full refund of the Earnest Mor~ey. Notwithstanding any'thing herein to the con~-ary, Buyer shall have the right to object to all of the matters listed in Sectior~ 3.1 (a) through (g)~ inclusive. If Buyer desires to ameq,d ~he Declaration of Restrictions (Section .3. l(g))~ .Buyer shall on or before ,Iune 1, 2002 submit to Seller the proposed ~mendment to the Declaration of Restrictions tu~d Seller sh~ll present the same to all parties affected by thc prol~osed chances in an attempt to obtai.~ approval. If Seller cannot obtain ap~,roval of all P.~2/~% 10o225 y.'2. -3- 04/25/2002 15:27 FAX 6514525550 CAMPBELL KNUTSON PA ~005/027 affected by the proposed amendment on or before July 1, 20..0_2, Seller shall, infbrm the Buyer and Buyer shall within fifteen (I 5'I days of notice fi'om Seller in t=on'n Seller whether or not Buy. f3' waives the requirement regarding the amendment of the Declaration of Restrictions and agrees to all other terms of this Agreement and that Buyer W_/.II proceed to Closing according to the terms hereof. If Buyer does not waive the rcquirmnent regardi_ng~.t_he Declaration of.Restrictions as stated above, then' this Agreement shall become null and void and Buyer :4g~.¢Le$_to execute a Ouit .Claim Deed upon the Earnest Money being returned to Buyer. 3.3) Seller shall furnish to Buyer a copy of any boundary survey thatSeller has in its possession (if any) within fifteen (15) days of the execution &this Agreement. In addition, on or befbre August '":**':~ ' q-~ .... ~,. e~+ .... ~^~ ~ ......... - .... ~ ........v ........ -.~, 2002, Seller shall provide, at Seller's expense, an ALTA Survey of the Subject Property (the "Survey") prepared by a surveyor reasonably acceptable to Buyer, and certified to Buyer, the title company and Buyer's lender, m~d meeting the minimm~a standard detail requirements for an ALTA/ACSM Land Title Survey for Urban Surveys (1997) standards, including items 1, 2, 3, 4, 6, 7, 8, 9, 10, 11, 13, 14, 15 and 16 of Table A. The Su_wey shall show and/or certify, without limitation, the total area of the Subject Property, the location of all improvements, recorded easements and encroachments, if any, located thereon and all building and set back lines and other matters of record with respect thereto_ SECTION 4. CLOSING 4.1) The closing (the "Closing") shall be at a location designated by Seller in the Twin Cities metropolitan area, and shaI1 occur on or before September 1, 2002 ("Closing Date"). Notwithstandh~g any other provision herein to the contrary, Buyer may extend the Closing Date for an additional thirty (30) days if all of the contingencies set forth in Section 7 (Buyer's ~ 00225_V.2 -4- Contingencies) have not been satisfied, provided Buyer is diligently pursuing the satisfaction thereof. If the Closing is not completed prior to October l, 2002, tiffs Agreement may be cancelled at the election of Seller or Buyer by the party canceling this Agreement serving upon the other party thirty (30) days written notice. In the event of such cancellation by either Seller or Buyer, the Earnest Money shall be returned promptly to Buyer and ndther party shall have any further rights under this Agreement. 4_2) On the Closing Date, Seller shall deliver to Buyer possession of the Subject Property fi'ee of any trash, debris or refuse. 4.3) On the Closing Date, Seller shall execute and deliver to Buyer: 4.3.1) A duly executed warranty deed, subject only to any exceptions consented to by Buyer, 4.3.2) A customary title affidavit that there are no unsatisfied judgments of record, no actions pending in any state or federal courts, no tax liens, and no bankruptcy proceeding filed against Seller, and no labor or materials have been furnished to the Subject Property for which payment has not been made, and that to the best of Seller's knowledge there are no m~recorded interests relating to the Subject Property; 4.3.3) A non-foreign affidavit, properly executed, containing such information as is required by Internal Revenue Code Section 1445(b)(2) and its regulations; and 4.3.4) A Certificate signed by Seller warrm~ting that there are no "Wells" on the Subject Property within the meaning of Minn. Stat. § 103I or if there are "Wells", a Well Certificate in the form required by/aw. 4.4) Seller shall pay at Closing all general real estate taxes levied against the Subject Property due and payable for all years prior to the year of Closing, together with the m~paid balance of all special assessments levied or pending on or before the date of Closing. Seller and Buyer shall prorate, as of the date of Closing, general real estate taxes due and payable in the year of Closing. Buyer shall be responsible for payment of all assessments levied against the Subject Property after the Closing. Such assessments shall include, but not limited to, ~oo2~ v.?= -5- [ 04/25/2002 15:27 FAX 6514525550 CA~IPBELL KNUTSON PA ~007/027 assessments associated with Buyer's anticipated development of the Subject Property. Buyer shall pay for all general real estate taxes due and payable in years subsequent to thc year of Closing. 4.5) Seller shall pay at or before Closing: 4.5. I) state deed tax; 4.5.2) all costs associated with obtaining a title insurance commitment, including name searches, tax searches, bankruptcy searches, and property inspection fees; 4.5.3) recording fees for corrective instnm~ents required to remove enctm~brances and place marketable title in Buyer's name; 4.5.4) one-half of the Closing fee charged by the Title Company; and 4.5.5) the cost of the Survey described in Section 3.3 hereof. 4.6) Buyer shall pay at Closing: 4.6.1) all recording fees and charges relating to the filing of the deed; 4.6.2) title insurance fees and premiums; 4.6.3) one-half of the Closing fee charged by the Title Company; 4.6.4) all sums due to Tires Plus Groupe, Ltd. or its assigns under the Declaration of Restrictions or Declaration of Cross Access, Utility and Parking Easements encumbering the Subject Property which obligates a purch~er of the Subject Property to share the cost of utility installation and road construction. As of August 1, 2001, the sum of approximately $112,000.00 is due. The actual amount owing shall be determined as of Closing. SECTION 5. COVENANTS, REPRESENTATIONS, AND WARRANTIES OF SELLER 5.1) Seller, as an inducement to Buyer to enter into this Agreement, and as part of the consideration therefor, represents, warrants, and covenants with Buyer and its successors and assigns that: ~ oo225 v'.*_ -6- o4/2a/2002 la:21 FAX 6514525550 CAI~IPBELL KNUTSON PA ~008/027 5.1.1) There are no leases, options, purchase agreements, rights to redeem, tenancy agreements, whtten or verbal, and no person or party has, or will have any rights of adverse possession, regarding the Subject Property; 5.1.2) Seller will maintain in force insurance against public 1/ability from such risk and to such limits as in accordance with prudent business practice and suitable to the Subject Property from file date hereof to the Closing Date; 5.1.3) To tile best kaaowledge of Seller, no entity or person has, at any time: i) "released" or actively or passively consented to the "release" or "tlu-eatened release" of any Hazardous Substance (as defined below) from any "facility" or "vessel" located on or used in connection with the Subject Property or adjacent tracts; or ii) taken any action in "response" to a "release" in com~ection with the Subject Property or adjacent tracts; or iff) otherwise engaged in any activity or omitted to take any action wlfich could subject Seller or Buyer to claims for intentional or negligent torts, s~ct or absolute liability, either pursuant to statute or common law, in connection with Hazardous Substances (as del'reed below) located in or on the Subject Property or adjacent tracts, including the genm'ating, transporting, treating, storage, or manufacture of any Hazardous Substance (as defined below)_ The terms set witkin quotation marks above shall have the meaning given to tl~em in the Comprehensive Environmental Response and L/ability Act, 42 U.S.C. Sec. 9601 e~ seq., as amended ("CERCLA") and any state environmental laws. 5.1.4) Seller, or any other person or entity, has not, at any time, ever installed, used, or removed any underground storage tank on or in com~ection with the Subject Property; and 5_1.5) There are no wells located upon the Subject Property. 5.1.6) Seller has the present full authority and power to execute this Agreement and to close the sale of the Subject Property. 5.2) The covenants, representations, and warranties contained in Section 5 shall be deemed to benefit Buyer and its successors and assigns and shall survive ar~y termination or expiration of this Purchase A~eement or the g/ving of the Deed. All of Seller's covenants, representations and ~varranties in this Agreeanent shall be true as of the date hereof and of the ~ °O 2 2:~A5~" -7- J 04/25/2002 15:27 FAX 6514525550 CAMPBELL KNUTSON PA ~009/027 Closing Date, and shall be a condition precedent to the performance of Buyer's obligations hereunder. Subject to the liability limits set forth in Minn. Stat. Chapter 466, Seller indemnifies Buyer from any breaches of the covenants, warranties and representations set forth in this Section 5. If Buyer discovers that any such covenant, representation, or warranty is not tmc, Buyer ,nay elect prior to Closing, in addition to any of its other fights and remedies, to cancel this Agreement, or Buyer may postpone the Closing Date up to ninety (90) days to allow t/me for correction. SECTION 6. ENVIRONMENTAL/SOIL INVESTIGATION AND TESTING 6.1) Buyer and its agents shall have the right, at the sole option of Buyer and at Buyer's cost and expense, to enter upon the Subject Property without charge and at all reasonable times from the date of the execution oftlfis Agreement to perform such envirormaental investigation and soil tests as Buyer may reasonably deem appropriate. If Buyer investigates and tests the Subject Property pursuant to this section, Buyer shall pay all costs and expenses of such investigation and testing mad shall hold Seller hannless from ali costs and liabilities arising out of Buyer's activities, except that Buyer shall have no liability with respect to the investigation, clean up, removal or remediafion of any existing hazardous substances which are encountered or discovered upon the Subject Property in connection with Buyer's inspections. Subject to the exception in the immediately preceding sentence, if the purchase and sale contemplated by this Agreement is not closed, Buyer shall, at its own expense, repair and restore any damage to the Subject Property caused by Buyer's investigation and testing, and shall return the Subject Propeaxy to substantially the same condition as existed prior to such entry. Buyer shall complete all environmental and soil testing by July 1, 2002 and shall inform Seller by July 15, 2002 whether or not Buyer is satisfied in its sole discretion with the results of the enviro~anental ]00225.¥2 ~8- I ~,~ ±o.~ ~Al u514oZaaa0 CA~IFBELL KNUTSON PA ~010/027 investigation and/or soil test and whether or not Buyer waives this contingency. If Buyer does not object to the environmental condition of the Subject Property or the soil condition by-A~hl 1 July 15, 2002, Buyer will be deemed to have waived its right to object thereto. If Buyer is not satisfied with the environmental condition or the condition of the soil as it relates to construction of the improvements contemplated by Buyer, Buyer may terminate this Agreement and shall be entitled to a refund of the Earnest Money. SECTION 7. BUYER'S CONTINGENCIES The obligations of Buyer under this Agreement are contingent upon each of the following: 7.1) Seller providing Buyer with the Survey ~c~.~ c.,~ ~) ..... ~.~ e~, , e~~ on or befor~ A~lg_u.s.t 1, 2002 7.2) Buyer, Buyer's lender and the Title Company shall determine on or before July 31,2002, that they are satisfied with the results of the matters disclosed by the Survey of the Subject Property and the Conm~itment, both as referenced in this A~eement, in accordance with the terms of S ection 3.1 hereof, and Buyer receiving, on the date of Closing, an owner's policy of title insurance in the form described in such Section 3.1. 7.3) The use of the Subject Property as contemplated by the Buyer shall have been approved by the City of Chanhassen and such other parties 'fi-om whom approval may be required on or before July 15, 2002. Such approval may require the re-platting of the Subject Property and all costs associated with the replatting and the obtaining of the approval by the City of Chanhassen shall be paid by/he I~uyer. ~oo~ v?, -9- I 04/25/2002 15:27 FAX 6514525550 CABIPBELL KNUTSON PA ~011/027 7.4) Buyer shall have determined, on or before4uty-14 June 1,2002, whether utility services, surface water disposal and/or drainage required for Buyer's intended use of the Subject Property will be available and in a size and capaci .ty reasonably acceptable to Buyer. 7.5) Buyer shall have determined in its sole discretion, on or befor~_J_m_~e 1 ~ 2002, whether reasonable access and adequate parking are available to the Subject Property. 7.6) On or before July 15, 2002, Buyer shall have entered into-a fully-signed and binding, non-contingent lease agreements, in forms acceptable to Buyer in Buyer's sole discretion, with tenants leasing at least 6,750 square feet in~ho a p.r_oposed 12,480 square foot building to be constructed on the Subject Property. If the contingency in Section 7.6 above has not been satisfied on or before July 15, 2002, the Buyer may, at Buyer's option, terminate this Agreement by giving written notice to Seller on or before July 15, 2002 or Buyer may extend the period of time for the satisfaction of the contingency set forth in Section 7.6 above for an additional periodo,~";v+",,,,,~., ~v,,~r~nx fo.t~y-fi,,~e_ (45) days by giving wr/tten notice to the Seller. If Buyer elects to terminate this Agreement pursuani to any of the above contingencies, neither party shall have any further rights or obligations under this Agreement and the Earnest Money shall be returned to Buyer and the Buyer shall execute and deliver to Seller a Quit Claim Deed at the time office delivery of the Earnest Money, which Quit Claim Deed shall memorialize the termination of this Agreement. SECTION 8. MISCELLANEOUS 8.1) The covenants, warranties and representations made by Seller shall survive the Closing of this transaction. ~oo2= v2 -10- v,~/,.o/,-uu,- J.a. 2o FAX ,>ol4a~aaa0 CAislPBELL KNUTSON PA ~012/027 8.2) Any notice, demand, or request wlrich may be permitted, required or desired to be given in connection herewith shall be in writing and sent by certified mail. A~ay notice shall be deemed effective when delivered to the party to whom it is directed. Uxrless other addresses are given in whting, notices shall be sent to Seller or Buyer at the applicable address stated on tl]e first page of this Agreement. 8,3) Time shall be of the essence in this Agreement. If any date or time prescribed by this Agreement falls on a Saturday, Sunday or holiday, such date or time shall automatically be extended to the next normal business day. 8.4) Each party hereto shall promptly, on the request of the other party, have acknowledged and delivered to the other party any and all further instnm~ents and assurances reasonably requested or appropriate to evidence or give effect to the provisions of this Agreement. 8.5) This Agreement represents the entire agreement of the parties with respect to the Subject Property and all prior agreements, understandings, or negotiations between the parties are hereby revoked and superseded hereby. No representations, wan'anties, inducements, or oral agreements have been made by any of the parties, except as expressly set forth herein, or in other contemporaneous writlen agreements. This Agreement may not be changed or modified except by a wr/tten agreement signed by Seller and Buyer. 8.6) If Buyer defaults under any of the terms hereof, Seller shall have the right to retain the Earnest Money but shall not have a further r/ght to other damages or specific pm-formance. 8.7) if Seller defaults under any of the terms hereof, including, without limitation, the delivery of marketable title to the Subject Property as set forth in Section43. hereof, then Buyer 04/25/2002 15:28 FAX 6514525550 CAMPBELL KNUTSON PA ~013/027 shall promptly receive a full roland of all Earnest Money, and, in addition, Buyer shall have, as its sole remedies, the right to either (i) seek specific performance of this Agreemem, or (ii) recover fi-om Seller, in an amount not to exceed $10,000, all out-of-pocket costs and expenses incurred by Buyer arising out of this Agreement. 8.8) If any provision of this Agreement is declared void or unenforceable, such provision shall be deemed severed from this Agreement, which shall otherwise remain in full force and effect. 8.9) Failure of any party to exercise any right arising out of a breach oft his Agreement shall not be deemed a waiver of any right with respect to any subsequent or different breach, or the continuance of any existing breach. 8.10) This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, personal representatives, successors and assigns. Buyer shall. have the right to assign its rights and obligations under this Agreement at any time; provided, however, that no such assignment shall relieve infinity ofChanhassen, LLC of/ts obligations under this Agreement. 8.11) Seller and Buyer represent and warrant to each other that they have not engaged or dealt with any broker or agent with respect to the Subject Property. Seller shall not under m~y circumstances bc liable for any brokerage fee. Notwithstanding the foregoing, Buyer and Seller shall each defend, indemnify and hold the other harmless from and against all claims, losses and liabilities incurred by the indemnified party in com~cction with any claim or demand by m~y person er entity for any brokers, finders, or other fee or compensation in connection with the indemnifying party's entry into this Agreement. u4,~,~uo~ 15,28 ~AX 6o14o2~oa~ CAIiPBELL KNUTSON PA ~014/02~ IN WITNESS WHEREOF~ the parties hereto have executed this Agreement as of the day and year first above writtem BUYER: INFINITY OF CHANHASSEN, LLC SELLER: CITY OF CHANI-IASSEN By: By: its: Its: By: Its: THIS INSTRUMENT WAS DRAFTED BY: CAMPBELL KNUTSON, P.A. 317 Eagandale Office Center 1380 Corporate Center Curve Eagan, ~ 55121 Telephone: (651) 452-5000 [JFK] 100225_~2 - 13- [ 04/25/2002 15:28 FAX 6514525550 CAMPBELL KNL~SON PA ~015/027 REAL ESTATE PURCHASE AGREEMENT THIS AGREEMENT (the "Agreement") made and entered into this __ day of ., 2002, by and between INFINITY OF CHANHASSEN, LLC, whose address is (referred to herein as the "Buyer"), and the CITY OF CHANHASSEN, a mmficipal corporation under the laws of the State of Minnesota~ with offices at 690 City Center Drive, P.O. Box 147, Chanhassen, Minnesota 55317 (referred to herein as the "Seller"). IN CONSIDERATION of the mutual covenants and agreements herein, it is hereby mutually agreed by Seller and Buyer as follows: SECTION 1. SALE AND PURCHASE OF LAND 1.1) Seller shall sell to Buyer and Buyer shall purchase from Seller, upon the tern'ts and conditions hereof, the following property (all collectively referred to as the "Subject Property"): 1.1.1) The land in Carver County, Minnesota, legally described as follows: Lots 2 and 3, Block 1, Crossroads Plaza 3ra Addition, according to the plat thereof on file and of record in the Office of the County Recorder and/or the Office of the Re~strar of Titles of Carver County, Mi~mesota. SECTION 2. PURCHASE PRICE 2. l) The purchase price for the Subject Property (the "Purchase Price") shall be the sum of Seven Hundred Five Thousand and No/100 Dollars ($705,000), and shall be payable by Buyer to Seller as follows: 2.1.1) Ten Thousand Dollars ($10,000.00) earnest money ("Earnest Money"), to be deposiIed with the Seller and held by thc Title Company (hereinafter defined) in an interest-bearing accoum reasonably acceptable to Buyer. The Earnest Mon.ey and all 00225 V~ - 1 - ~,. uu~ ~u.~ ~,~ ~u±~uz~U bA~I?B~LL ~NUI~UN PA ~016/027 interest accrued thereon shall be applied (i) against the Purchase Price at Closing, or (ii) as liquidated damages and as Seller's sole remedy, in the event the Seller performs all of its obligations under this Agreement and Buyer fails to close as required in this Agreement. The Earnest Money and all accrued interest thereon shall be returned to the Buyer in the event of (i) refusal of the Seller to perform its obligations under this Agreement, or (ii) Buyer's termination oft. his Agreement within the Contingency Period, as hereinafter set forth. 2.1.2) The balance of the Purchase Price ir~ cash on the date of Closing. 2.1_3) In addition to the foregoing, Buyer shall pay at Closing the amount set forth in the "Amendment to Declaration of Restrictions to Revise Exhibit A' as set forth in 4.6,4 hereof. SECTION 3. TITLE MATTERS 3.1) Seller shall cause to be furnished to Buyer on or before May 15, 2002, a current commitment for the issuance of an ALTA Form B (1990) owner's policy of title insurance (the "Commitment") issued by Chicago Title Insurance Company by its agent Carver Connty Abstract and Title Company, Inc. ("Title Company") in the proposed amount of the Purchase Price, committing to insure that Buyer will have good and marketable title to the Subject Property, subject to the following easements, decimations, restrictions and er~cumbrances affecting the Subject Properly which shall be reviewed and approved by Buyer on or before June 15, 2002: (a) "Declaration of Cross Access, Utility and Parking Easements"; (b) "Declaration of Restrictions" (as amended to Buyer's satisfaction); (c) "Parking and Access Easement Agreement"; (d) permanent and temporary easements currently of record; (e) standard exceptions to title; (f) zoning and all other governmental ordinances, regulations, requirements and laws; and (g) except matters to wtfich Buyer may consent in writing. Buyer shall have (1) fifteen (15) days after Buyer's receipt of the Commitment, and (2) fifteen (15) days after Buyer's receipt of the Survey defir~ed in Section 3_3 l~ereof, to make any objections to the matters disclosed in the Commitment and/or Survey. Such objections to be made in writing or deemed 1o02,2~ v3 -2- 04/25/2002 18:28 FAX 6514525550 CAMPBELL KNUT$0N PA ~017/027 to be waived. The Commitment shall show all matters affecting title to the Subject Property, with copies of all instruments referenced therein, and shall bind the Title Company to issue to and in favor of Buyer at Closing an owner's policy of title insurance insuring marketable title to the Subject Property, affirmatively insuring any appurtenant easements~ deleting thc standard exceptions upon receipt of the Survey and the title affidavit, and contairfing such endorsements as Buyer requires, including, w/thout limitation, 3.1 zoning (including parking) endorsement, comprehensive endorsement, separate tax lot endorsement, access endorsement, usury, and survey endorsement. Copies of the resections, covenants and declarations (without amendment) referred to in (a), (b) and (c) are attacl~ed hereto. 3.2) In the event any exceptions are listed in the Commitment other the items listed in Section 3.1 (a), (b), (c), (d), (e), (f) and (g), J. fthe same results from m~y voluntary action by the Seller, or if the same relates to any lien or encumbrance ora monetary nature, which can be removed by payment of an amount up to the Purchase Price at closing, the Seller shall cause the exception to be removed on or before the Closing Date. With regard to any other exceptions or objections to title or the Survey, if the Seller fails to remove the same wit[fin the t/me allowed 'for closing on the Subject Property, the Buyer shall have as its sole remedy the fight to terminate this Agreement and receive a full refund of the Earnest Money. Notwithstanding anything herein to the contrary, Buyer shall have the right to object to all of the matters listed in Section 3.1(a) through (g), inclusive. If Buyer desires to amend the Declaration of Restrictions (Section 3.1 (g)), Buyer shall on or before June 1, 2002 submit to Seller the proposed mnenchnent to the Declaration of Restrictions and Seller shall present the same to all parties affected by the proposed changes in an attempt to obtain approval. If Seller cannot obtain approval of all parties affected by the proposed amendment on or before July 1, 2002, Seller shall inform the Buyer and ~00z~5 w -3- o4~5z=00= lo:2o ~A% ooi4o2o$50 CA~fPBELL KNUTSON PA ~018/027 Buyer shall within fifteen (15) days of notice from Seller inform Seller wl~etber or not Buyer waives the requirement regarding thc amendment of the Declaration of Restrictions and agrees to all other terms of th/s Agreement and that Buyer will proceed to Closing according to the terms hereof. If Buyer does not waive the requirement regarding the Declaration of Restrictions as stated above, then this Agreement shall become null and void and Buyer agrees to execute a Quit Claim Deed upon the Earnest Money being returned to Buyer. 3.3) Seller shall furnish to Buyer a copy of any boundary survey that Seller has in its possession (if any) within fi~een (15) days of the execution oft his Agreement. In addition, on or before August I, 2002, Seller shall provide, at Seller's expense, an ALTA Survey o£the Subject Property (the "Survey") prepared by a surveyor reasonably acceptable to Buyer, and certified to Buyer, the title compai~y and Buyer's lender, and meeting the minimum standard detail requirements for an ALTA/ACSM Land Title Survey for Urban Smweys (I997) standards, including items 1, 2, 3, 4, 6, 7, 8, 9, 10, 1I, 13, 14, !5 and 16 of Table A. The Survey shall show and/or certify, without limitation, the total area oft_he S abject Property, the location of ali improvements, recorded easements and m~croachments, if any, located thereon and all building and set back lines and other matters of record with respect thereto. SECTION 4. CLOSING 4.1) The closing (the "Closing") shall be at a location designated by Seller in the Twin Cities metropolitan area, and shall occur on or before September 1, 2002 ("Closing Date"). Notwithstanding any other provision herein to the contrary, Buyer may extend the Closing Date for an additional thirty (30) days if all of the contingencies set forth in Section 7 (Buyer's Contingencies) have not been satisfied, provided Buyer is diligently pursuing the satisfaction thereof. If the Closing is not completed prior to October 1, 2002, this Agreement may be 1002~ V3 -4- 04/25/2002 15:28 FAX 6514525550 CAMPBELL KNUTSON PA ~019/027 cancelled at the election of Seller or Buyer by the party canceling this Agreement serving upon the other pm-ty thirty (30) days written notice. In the event ofsucl~ cancellation by either Seller or Buyer, the Earnest Money shall be returned promptly to Buyer and neither party shall have any further fights under this Agreement. 4.2) On the Closing Date, Seller shall deliver to Buyer possession of the Subject Property free of any trash, debris or refuse. 4.3) On the Closing Date, Seller shall execute and deliver to Buyer: 4.3.1) A duly executed warranty deed, subject only to any exceptions consented to by Buyer;, 4.3.2) A customary title affidavit that there are no unsatisfied judgments of record, no actions pending in any state or federal courts, no tax liens, and no bankruptcy proceeding filed against Seller, and no labor or materials have been furnished to the Subject Property for which payment has not been made, and that to the best of Seller's knowledge there are no unrecorded interests relating to the Subject Property; 4.3.3) A non-foreign affidavit, properly executed, containing such information as is required by Internal Revenue Code Section 1445(b)(2) and its reg-ulations; and 4.3.4) A Certificate signed by Seller warranting that there are no "Wells" on the Subject Property within the meaning of Mi~m. Stat, § 103I or if there are "Wells", a Well Certificate in the form required by law. 4.4) Seller shall pay at Closing all general real estate taxes levied against the Subject Property due and payable for ail years prior to the year of Closing, together with the unpaid balance of all special assessments levied or pending on or before the date of Closing. Seller and Buyer shall prorate, as of the date of Closing, general real estate taxes due and payable in the year of Closing. Buyer shall be responsible for payment of all assessments levied against the Subject Propen'y after the Closing. Such assessments shall include, but not limited to, assessments associated with Buyer's anticipated development of the Subject Property. Buyer ~o0225 w -5- U4fz5/~UU2 1~:29 FA~ 651452~5§0 CA~IPBELL KNUTSON PA ~020/027, shall pay for all general real estate taxes due and payable in years subsequent to the year of Closing. 4.5) Seller shall pay at or before Closing: 4.5.1) state deed tax; 4.5.2) all costs associated with obtaining a title insurance commitment, including name searches, tax searches, bank_mptcy searches, and property inspection fees; 4.5.3) recording fees for corrective instruments required to remove encumbrances and place marketable title in Buyer's name; 4.5.4) one-half of the Closing fee charged by the Title Company; and 4.5.5) the cost of the Survey described in Section 3.3 hereof, 4.6) Buyer shall pay at Clos/ng: 4.6.1) all recording fees and charges relating to the filing of the deed; 4.6.2) title insurance fees and premiums; 4.6.3) one-half of the Closing fee charged by the Title Company; 4.6.4) all sums due to Tires Plus Groupe, Ltd. or its assigns under the Declaration of Restrictions or Declaration of Cross Access, Utility and Parking Easements encumber/ng the Subject Property which obligates a purchaser of the Subject Property to share the cost of utility installation and road construction. As of August !, 2001, the sum ofapproximately $112,000.00 is due. The actual amount owing shall be determined as of Closing. SECTION 5. COVENANTS,.REPRESENTATIONS~ AND WARRANTIES OF SELLER 5.1) Seller, as an inducement to Buyer to enter into this Agreement, and as part of the consideration therefor, represents, warrants, and covenants with Buyer and its successors and assigns that: 5.1. ~) There are no leases, options, purchase agreements, rights to redeem, tenancy agreements, written or verbal, and no person or party has, or will have any rights of adverse possession, regarding the Subject Property; 00225 V3 - 6- 04/25/2002 15:29 FAX 6514525550 CAMPBELL KNUTSON PA ~021/027 5.1.2) Seller will maintain in force insurance against public liability fi.om such risk and to such limits as in accordance with prudent business practice and suitable to the Subject Property from the date hereof to the Closing Date; 5.1.3) To the best knowledge of Seller, no entity or person has, at any time: i) "released" or actively or passively consented to the "release" or "threatened release" of any Hazardous Substance (as defined below) firom any "facility" or "vessel" located on or used in connection with the Subject Property or adjacent tracts; or ii) taken any action in "response" to a "release" in connection with the Subject Property or adjacent tracts; or iii) otherwise engaged in any activity or omitted to take any action which could subject Seller or Buyer to claims for intentional or negligent torts, strict or absolute liability, either pursuant to statute or cormnon law, in connection w/th Hazardous Substances (as defined below) located in or on the Subject Property or adjacent tracts, including the generating, t~-ansport/ng, treating, storage, or manufacture of any Hazardous Substance (as defined below). The terms set w/thin quotation marks above shall have the meaning given to them in the Comprelaensive Enviromnental Response and Liability Act, 42 U.S.C. Sec. 9601 et seq., as anaended ("CERCLA") and any state environmental laws. 5.1.4) Seller, used, or removed any Property; and or any other person or entity, has not, at any time, ever installed, m~derground storage tank on or in connection with the Subject 5.1.5) There are no wells located upon the Subject Property. 5.1.6) Seller has the present full authority and power to execute this Agreement and to close the sale of the Subject Property. 5.2) The covenants, representations, and warrant/es contained in Section 5 shall be deemed to benefit Buyer and its successors and assigns and shall survive any tem~ination or expiration of this Purchase Agreement or the giving of the Deed. All of Seller's covenants, representations and warranties in this Agreement shall be true as oft. he date hereof and of the Closing Date, and shall be a condition precedent to the perfom~ance of Buyer's obligations hereunder. Subject to the liability limits set forth in Minn. Stat. Chapter 466, Seller indemnifies ]oo225 v3 -7- o.,ao,=uoz .to.~ ~A.'~ uo145~o~o0 CA~IPBELL ~I~[ITSON ~'A [g]022/027 Buyer from any breaches of the covenants, warranties and representations set forth in this Section 5. If Buyer discovers flint any such covenant, representation, or warranty is not true, Buyer may elect prior to Closing, in addition to any of its other rights and remedies, to cancel this Agreement, or Buyer may postpone the Closing Date up to ninety (90) days to allow time for correction. SECTION 6. ENVIRONMENTAL/SOIL INVESTIGATION AND TESTING 6.1) Buyer and its agents shall have the fight, at the sole option of Buyer and at Buyer's cost and expense, to enter upon the Subject Property without charge and at all reasonable times from the date of the execution of this Agreement to perform such environmental investigation and soil tests as Buyer may reasonably deem appropriate. If Buyer investigates and tests the Subject Property pursuant to th/s section, Buyer shall pay all costs and expenses of such investigation and testing and shall hold Seller harmless from ail costs and liabilit/es arising out of Buyer's activities, except that Buyer shall have no liability with respect to the investigation, clean up, removal or remediation of any existing hazardous substances which are encountered or discovered upon the Subject Property in connection with Buyer's inspections. Subject to the exception in the immediately preceding sentence, if the purchase and sale contemplated by this Agreement is not closed, Buyer shall, at its own expense, repair and restore any damage to the Subject Property caused by Buyer's/nvestigation and testing, and shall return the Subject Property to substantially the same condition as existed prior to such entry. Buyer shall complete all environmental and soil testing by July 1, 2002 and shall inform Seller by July 15, 2002 whether or not Buyer is satisfied in its sole discretion with the results of the environmental investigation and/or soil test and whether or not Buyer waives this contingency. If Buyer does not object to the environmental condition of the Subject Property or the soil condition by July 15, ~0022~ w -8- 04/25/2002 15:29 FAX 6514525550 CAMPBELL KN[~SON PA ~023/027 2002, Buyer will be deemed to have waived its right to object thereto. If Buyer is not satisfied with the environmental condition or the condition of the soil as it relates to construction of the improvements contemplated by Buyer, Buyer may terminate this Agreement and shall be entitled to a refund of the Earnest Money. SECTION 7. BUYER'S CONTINGENCIES The obligations of Buyer under this Agreement are contingent upon each of the following: 7. i) Seller providing Buyer with the Survey on or before August 1, 2002. 7.2) Buyer, Buyer's lender and the Title Company shall determine on or before July 31, 2002, that they arc satisfied with the results of the matters disclosed by the Survey of the Subject Property and the Commitment, both as referenced in this Agreement, in accordance with the terms of Section 3.1 hereof, and Buyer receiving, on the date of Closing, an owner's policy of title insurance in the form described in such Section 3_1. 7_3) The use of the Subject Property as contemplated by the Buyer shall have been approved by the City of Chanhassen and such other parties from whom approval may be required on or before July 15, 2002. Such approval may require the re-platting of the Subject Property and all costs associated with the replatting and the obtaining of the approval by the City of Chanhassen shall be paid by the Buyer. 7.4) Buyer shall have determined, on or before June 1, 2002, whether utiliw services, surface water disposal and/or drainage required '~br Buyer's intended use of the Subject Property will be available and in a size and capacity reasonably acceptable to Buyer. 7.5) Buyer shall have detem~ined in its sole discretion, on or before June 1, 2002, whether reasonable access and adequate parking are available to the Subject Proper~y. ~ 00225 v3 -9- u~,.o,,uu, lo,.B ~Ax ~514oz~0 CA~IFB~LL KNUTSON PA ~024/027 7.6) On or before July 15, 2002, Buyer shall have entered into fully-signed and binding, non-contLngcnt lease agreements, in forms acceptable to Buyer in Buyer's sole discretion, with tenants leasing at least 6,750 square feet in a proposed 12,480 square foot building to be constructed on the Subject Propei~-y. If the contingency in Section 7.6 above has not been satisfied on or before July 15, 2002, the Buyer may, at Buyer's option, terminate this Agreement by giving written notice to Seller on or before July 15, 2002 or Buyer may extend the period of time for the satisfaction of the contingency set forth in Section 7.6 above for an additional period of forty-five (45) days by g/ring written notice to the Seller. If Buyer elects to terminate this Agreement pursuant to any of the above contingencies, neither party shall have any further rights or obligations under tLtfiS Agreement and the Earnest Money shall be returned to Buyer and the Buyer shall execute and deliver to Seller a Quit Claim Deed at the lime of the delivery of the Earnest Money, Milch Quit Claim Deed shall memorialize the termination of this Agreement. SECTION 8. MISCELLANEOUS 8.1) The covenants, warranties and representations made by Seller shall survive the Closing of this transaction. 8.2) Any notice, demand, or request which may be permitted, required or desired to be g/yen in connection herewith shall be in writing and sent by certified mail. Any notice shall be deemed effective when delivered to the party to whom it is directed. Unless other addresses are given in writing, notices shall be sent to Seller or Buyer at the applicable address stated on the first page of this Agreement. t oo22~ w - i O- 04/25/2002 15:29 FAX 6514525550 CAMPBELL KNUTSON PA ~025/027 8.3) Time shaI1 be of the essence in this Agreement. If any date or time prescribed by this Agreement falls on a Saturday, Sunday. or holiday, such date or time shall automatically be extended to the next normal business day. 8.4) Each party hereto shall promptly, on the request of the other party, have acknowledged and delivered to the other party any and all further instruments and assurances reasonably requested or appropriate to evidence or give eft~et to the provisions of this Agreement. 8.5) This Agreement represents the entire agreement of the parties with respect to the Subject Property and all prior agreements, understandings, or negotiations between the parties are hereby revoked and superseded hereby. No representations, warranties, inducements, or oral agrecrnents have been made by any of the parties, except as expressly set forth herein, or in other contemporaneous written' agreements. Tlnis Agreement may not be changed or modified except by a written agreement signed by Seller and Buyer. 8.6) If Buyer defaults under any of the terms hereof, Seller shall have the hght to retain the Earnest Money but shall not have a further right to other damages or specific performance. 8-7) if Seller defaults under any of the terms hereot~ including, without 1/mitation, the delivery of marketable title to the Subject Property as set forth in Section3 hereof, then Buyer shall promptly receive a full refund of all Em-nest Money, and, in addition, Buyer shall have, as its sole remedies, the right to either (i) seek specific performance of this Agreement, or (ii) recover from Seller, in an amount not to exceed $10,000, all out-of-pocket costs and expenses incurred by Buyer arising out of this Agrccanent. ~oo2~5 w -11- FAx 6~14~2~0 CASIPBELL KNUTSON PA ~]026/027 8.8) If any provision oft_his Agreement is declared void or unenforceable, such provision shall be deemed severed from this Agreement, whicl~ shall otherwise remain in full force and effect. 8.9) Failure of any party to exercise any right arising out ora breach of this Agreement shall not be deemed a waiver of any right with respect to any subsequent or different breach, or the continuance of any existing breach. 8.10) This Agreement shall inure to the benefit of and be bknding upon the parties hereto and their respective heirs, personal representatives, successors and assigns. Buyer shall have the fight to assign its rights and obligations under this Agreement at any time; provided, however, that no such assignment shall relieve infirfity of Chanhassen, LLC of its obligations m~der tiffs Agreement. 8.1 1) Seller and Buyer represent and warrant to each other that they have not engaged or dealt with any broker or agent with respect to the Subject Property. Seller shall not under any circumstances be liable }hr any brokerage fee. Notwithstanding the foregoing, Buyer and Seller shall each defend, indelmfify and hold the other harmless from and against all claims, losses and liabilities incurred by the indemnified party in connection with any claim or demand by any person or entity for any brokers, finders, or otl~er fee or compensation in connection witI~ the indemnifying party's entry into this Agzeement. ~0022sv3 -12- 04/25/2002 15:30 FAX 6514525550 CAMPBELL KNUTSON PA ~027/027 IN WITNESS WHEREOF, thc parties hereto have cxccutcd this Agreement as o£the day and year first above written. BUYER: INFINITY OF CHANHASSEN, LLC SELLER: CITY OF CHANHASSEN By: By: Its: Its- By: Its: THIS INSTRUMENT WAS DRAFTED BY: CAMPBELL KNUTSON, P.A. 317 Eagandale Office Center 1380 Corporate Center Curve Eagan, MN 55121' Telephone: (651) 452-5000 [3FK] }o022s v3 - 13-