HomeMy WebLinkAboutX-E-02 Approve Purchase Agreement for Property for a Water Treatment Plant from Jocor Holdings LLC City Council Memorandum
To: Mayor Fasbender & City Council Members
From: Ryan Stempski – Public Works Director
Date: November 18, 2024
Item: Approve Resolution and Authorize Signature for Purchase Agreement at 1292 North Frontage
Road
Council Action Requested:
The Council is requested to approve the attached resolution and authorize signature of the purchase
agreement for acquisition of 1292 North Frontage Road.
Background Information:
At the September 16, 2024, City Council Closed Session Meeting the purchasing of sites identified in the
Water Treatment Plant Siting Study was discussed. 1292 North Frontage Road was the specific property
determined for WTP No. 2 (central treatment plant). The incremental cost to move from Lions Park to
this site was approximately $600,000, which was the lowest cost increase among feasible sites analyzed.
The increase was due to the need to purchase property and the additional footage of raw watermain
from Well No. 7. There were some estimated savings in the ability to maximize treatment of Nitrates at
the existing Nitrate Treatment Plant, which is the neighboring property.
Financial Impact:
The cost of the property will be discussed during closed session with the City Council. The cost will be
updated in the purchase agreement per City Council direction. The City will seek reimbursement of the
full acquisition amount through the 3M Settlement Grant Agreement administered by the Co-Trustees.
Attachments:
Resolution Approving Purchase of 1292 North Frontage Road
Purchase Agreement for 1292 North Frontage Road
X-E-02
RESOLUTION NO. _______
CITY OF HASTINGS
DAKOTA COUNTY, MINNESOTA
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HASTINGS
APPROVING THE PURCHASE OF PROPERTY FOR A WATER
TREATMENT PLANT FROM JOCOR HOLDINGS LLC
WHEREAS, the City of Hastings (“City”) determined three water treatment plants would be
required to remove PFAS from the City’s municipal wells and provided various options to the City
Council for the potential locations of these plants; and
WHEREAS, public feedback was received, and the City Council communicated a strong
preference for the plants to be located outside of residential neighborhoods; and
WHEREAS, a Water Treatment Plant Siting Study (“WTP Study”) was initiated to determine
the feasibility and cost-effectiveness of various sites, depending upon several factors:
Sufficient land area owned or available for acquisition
Proximity to existing wells and raw water mains
Proximity to trunk distribution water mains and storage tanks
Proximity to pressure zone facilities (booster pumps/pressure reducing valves)
Proximity to trunk sanitary sewers
Proximity to transportation corridors
Site topography
and
WHEREAS, based on the above factors, the WTP Study narrowed the sites for consideration,
which were discussed by the City Council; and
WHEREAS, Well No. 5 has been connected to PFAS contamination from 3M-CG and the
co-trustees have deemed treatment of Well No. 5 eligible for East Metro 3M Settlement Funds,
therefore its site selection was prioritized as a high priority for the City; and
WHEREAS, one site location for a water treatment plant to treat Well No. 5 was identified
in the WTP Study that met many of the factors for the central water treatment plant, including its
size, its placement in a commercial zoning district, its proximity to other City infrastructure, and
the willingness of the property owner to enter into voluntary negotiations for the purchase,
therefore, the City Council selected this site as its preferred site for the central water treatment
plant; and
WHEREAS, pursuant to that site selection, City Staff obtained an appraisal for the site
and entered into negotiations with the property owner; and
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WHEREAS, City Staff was able to negotiate mutually agreed upon terms and conditions
for the purchase of the site with the property owner, JoCor Holdings LLC (“JoCor”) and a purchase
agreement was prepared to memorialize the terms and conditions; and
WHEREAS, the City desires to purchase certain real property legally described on the
attached Exhibit A (“Property”) pursuant to a Purchase Agreement by and between JoCor and the
City (“Purchase Agreement”), for the purpose of constructing the central water treatment plant on
the Property; and
WHEREAS, the Purchase Agreement describes and articulates the terms and conditions
of the purchase of Property from JoCor and City agrees to accept the terms of the sale; and
WHEREAS, on November 18, 2024, the City Council considered all of the information
presented at the Council meeting.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
HASTINGS AS FOLLOWS:
1. The purchase of the Property from JoCor is in the public interest of the City and its people,
furthers its plan of removing the PFAS in the City’s water system by constructing a water
treatment plant on the Property; and the appropriate officials are authorized to take such
action so as to effectuate such purchase.
2. The City Staff is authorized to seek reimbursement of the full acquisition amount including
lease relocation amounts through the 3M Settlement Grant Agreement administered by the
Co-Trustees.
The City Council hereby approves the Resolution as presented.
Council member_________________ moved a second to this resolution and upon being put
to a vote it was adopted by the Council Members present.
Adopted by the Hastings City Council on_______________, 2024 by the following vote:
Mary Fasbender, Mayor
ATTEST:
Kelly Murtaugh, City Clerk
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
Real property located in the County of Dakota, State of Minnesota legally described as
follows:
That part of the S 1/2 of the NE 1/4 of Section 29, Township 115, Range 17, described as
follows: Commencing at a point which is 1418 feet West and 10 feet North of the Southeast
corner of said NE 1/4 of said Section 29, thence North at right angles 300 feet, thence East
145.2 feet, thence South 300 feet, thence West 145.2 feet to the place of beginning, Dakota
County, Minnesota.
PID: 19-02900-05-010
Abstract Property
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PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT (“Agreement”) is made and entered into as of
__________________________, 2024 (“Effective Date”), by and between JoCor Holdings LLC,
a Minnesota limited liability company (“Seller”), and the City of Hastings, a municipal corporation
under the laws of Minnesota (“City”).
RECITALS
A. Seller is the fee owner of real property located in the City of Hastings, Minnesota, legally
described on Exhibit A (the “Property”), attached hereto and incorporated herein by reference.
B. City desires to purchase the Property from Seller, and Seller desires to sell the same to City,
all on the terms and conditions of this Agreement.
NOW, THEREFORE, Seller and City agree as follows:
1. Sale.
1.1. Sale. Subject to the terms and provisions of this Agreement, Seller shall sell to
City, and City shall purchase from Seller, the Property excluding any personal
property on site and the rooftop units, which cannot be removed until the Property
is vacant.
1.2. Purchase Price. The purchase price to be paid by City to Seller for the Property
shall be Dollars and 00/100s ($ .00)
(the “Purchase Price”), payable as follows: (a) Ten Thousand Dollars and 00/100s
($10,000.00), as earnest money (“Earnest Money”), to be paid to DCA Title, 750
Main Street, Suite 280, Mendota Heights, MN 55118 (“Title”) upon execution of
this Agreement; and (b) the balance on the Closing Date (as defined in Section 6)
subject to those adjustments, prorations, and credits described in this Agreement,
in cash or certified funds or by wire transfer pursuant to instructions from Seller.
The Closing will occur at Title, unless otherwise agreed to by the parties. If this
Agreement is terminated by City as a result of a default by Seller, then the Earnest
Money shall be returned to City and neither Seller nor City shall be liable to the
other for any further obligations under this Agreement (except for such obligations
as specifically survive termination of this Agreement).
2. Available Surveys, Tests, and Reports. Within five (5) days of the Effective Date, Seller
shall cause to be delivered to City to the extent same are in the possession and control of
Seller: (a) copies of any surveys, soil tests and environmental reports previously conducted
on the Property; (b) copies of leases associated with the Property, (c) copies of existing
title work for the Property (the “Due Diligence Materials”). Seller makes no representations
or warranties regarding the accuracy or completeness of the Due Diligence Materials. City
acknowledges that the sale of the Property is “AS-IS”, “WHERE IS,” and “WITH ALL
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FAULTS”, and that it is the obligation of City to conduct and complete its due diligence
and investigations relating to the Property.
3. City’s Investigations. For a period up to Closing Date, following the Effective Date,
Seller shall allow City and City’s agents access to the Property without charge and at all
times for the purpose of City’s investigation and testing of the Property, including
surveying and testing of soil and groundwater (“City’s Investigations”); provided,
however, City shall not perform any invasive testing unless (a) Seller gives its prior
approval of City’s consultant that will perform the testing, which approval shall not be
unreasonably withheld, conditioned or delayed, and (b) City gives Seller reasonable prior
notice of such testing. City shall pay all costs and expenses of City’s Investigations and
shall indemnify and hold Seller and the Property harmless from all costs and liabilities,
including but not limited to mechanics’ liens, relating to activities on the Property related
to City’s Investigations, however, City shall not be responsible for liens, liability, loss,
expense or costs arising out of the discovery or presence of Hazardous Substances (as such
term is defined in Section 9.1.7) on the Property or otherwise arising out of Seller’s
noncompliance with any Environmental Law (as such term is defined in Section 9.1.7) or
other law or regulation. Seller shall have the right to accompany City during any of City’s
Investigations of the Property. If requested by Seller, City shall provide to Seller copies of
all third-party, non-confidential written test results and reports conducted as part of City’s
Investigations. City shall pay all of the costs and expenses associated with City’s
Investigations, to cause to be released any lien on the Property arising as a result of City’s
Investigations and to repair and restore, at City’s expense, any damage to the Property
caused by City’s Investigations. The indemnification obligations set forth herein shall
survive termination or cancellation of this Agreement.
4. Insurance; Risk of Loss. Seller assumes all risk of destruction, loss, or damage to the
Property prior to the Closing Date. If, prior to the Closing Date, all or any portion of the
Property or access thereto is condemned, taken by eminent domain, or damaged by cause
of any nature, or the Property is rendered untenantable, Seller shall immediately give City
notice of such condemnation, taking, or damage. After receipt of notice of such
condemnation, taking or damage (from Seller or otherwise), City shall have the option (to
be exercised within thirty (30) days after Seller’s written notice) either (a) to require Seller
to (i) convey the Property at Closing (as defined in Section 6) to City in its damaged
condition, upon and subject to all of the other terms and conditions of this Agreement
without reduction of the Purchase Price, (ii) assign to City at Closing all of Seller’s right,
title and interest in and to any claims Seller may have to insurance proceeds, condemnation
awards and/or any causes of action with respect to such condemnation or taking of or
damage to the Property or access thereto, and (iii) pay to City at Closing by certified or
official bank check all payments made prior to the Closing Date under such insurance
policies or by such condemning authorities, or (b) to terminate this Agreement by giving
notice of such termination to Seller, whereupon this Agreement shall be terminated, any
amount previously paid by City to Seller shall be refunded to City and thereafter neither
party shall have any further obligations or liabilities to the other. If the right to terminate
this Agreement is not exercised within such thirty (30) day period, such right shall be
deemed to have been waived. Seller shall not designate counsel, appear in, or otherwise
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act with respect to the condemnation proceedings without City’s prior written consent,
which consent shall not be unreasonably withheld.
5. Contingencies.
5.1. City’s Contingencies.
5.1.1. Unless waived by City in writing, City’s obligation to proceed to Closing
shall be subject to (a) performance by Seller of its obligations hereunder,
(b) the continued accuracy of Seller’s representations and warranties
provided in Section 9.1, and (c) City’s satisfaction, in City’s sole discretion,
as to the contingencies described in this Section 5.1:
5.1.1.1. On or before the Closing Date, City shall have determined, in its
sole discretion, that it is satisfied with (a) the results of and matters
disclosed by City’s Investigations, physical inspection, surveys,
soil tests, engineering inspections, hazardous substance and
environmental reviews of the Property, and all other inspections
and due diligence regarding the Property, including any
association rules or regulations applicable to any of the Property
or any Due Diligence Materials. If City has not terminated this
Agreement on or before the Closing Date, the contingency set
forth in this paragraph shall be deemed waived.
5.1.1.2. On or before the Closing Date, City shall have received from Title
an irrevocable commitment to issue a title insurance policy for the
Property in a form and substance satisfactory to City in City’s sole
discretion, not disclosing any encumbrance not acceptable to City
in City’s sole discretion (the “Approved Commitment”). If City
has not terminated this Agreement on or before the Closing Date,
the contingency set forth in this paragraph shall be deemed
waived.
5.1.1.3. On or before the Closing Date, City may obtain an ALTA survey
for the Property certified to City and Title.
5.1.1.4. On or before the Closing Date, Seller shall have obtained releases
of the Property from any and all mortgages or other monetary liens
affecting any of the Property.
5.1.1.5. On or before the Closing Date, Seller shall have obtained all valid,
necessary and sufficient waivers, assignments, subordinations,
non-disturbance, attornments, approvals, authorizations, estoppel
certificates and consents of each and every party whose waiver,
subordination, non-disturbance, attornment, approval,
authorization, estoppel certificate or consent to transfer the
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Property and consummate the transactions contemplated by this
Agreement.
5.1.1.6. On or before the Closing Date, the proper termination or
assignment of any and all lease rights related to the Property to the
satisfaction of the City.
5.1.1.7. On or before the Closing Date, the vacation of the Property by the
Seller.
5.1.1.8. On or before the Closing Date, Seller shall terminate or with
consent of the City, shall assign all surviving contracts, permits
and licenses, warranties, and intangible property conveying to
City with warranties the surviving contracts, permits and licenses,
warranties and intangible property, free and clear of all
encumbrances, together with the consent of all parties having the
right to consent to such assignment, if necessary.
5.1.1.9. On or before the Closing Date, Seller shall execute a Bring-Down
Certificate certifying that all of the warranties and representations
made by Seller in this Agreement remain true as of the date of
closing.
5.1.1.10. On or before the Closing Date, the termination or elimination of
any and all option to purchase rights, Rights of First Refusal, or
Rights of First Offer related to the Property to the satisfaction of
City.
5.1.1.11. On or before the Closing Date, City shall have secured sufficient
funding to satisfy the Purchase Price.
The foregoing contingencies are for City’s sole and exclusive benefit and one (1)
or more may be waived in writing by City in its sole discretion, or by the passage
of time as set forth hereinabove. Seller shall reasonably cooperate with City’s
efforts to satisfy such contingencies, at no out-of-pocket cost to Seller or
assumption of any obligation or liability by City. City shall bear all cost and
expense of satisfying City’s contingencies. If any of the foregoing contingencies
have not been satisfied on or before the applicable date, then this Agreement may
be terminated, at City’s option, by written notice from City to Seller. If City
terminates this Agreement as a result of a failure of a City contingency prior to the
applicable date, the Earnest Money shall be returned to City and neither Seller nor
City shall be liable to the other for any further obligations under this Agreement
(except for such obligations as survive termination of this Agreement). Such written
notice must be given on or before the applicable date set forth herein above for such
contingency, or City’s right to terminate this Agreement pursuant to such
contingency shall be waived. Upon termination, neither party shall have any further
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rights or obligations against the other regarding this Agreement or the Property,
except for such obligations that survive termination of this Agreement.
5.1.2. If City elects not to exercise any of the contingencies set out herein, such
election may not be construed as limiting any representations or obligations
of Seller set out in this Agreement. Further, City shall not be deemed to
have waived any of the foregoing contingencies on account of its execution
of this Agreement.
5.2. Seller’s Contingencies. Seller’s obligation to proceed to Closing shall be subject
to the satisfaction, on or prior to the Closing Date, of each of the following
conditions:
5.2.1. City shall have performed and satisfied all agreements, covenants and
conditions required pursuant to this Agreement to be performed and
satisfied by or prior to the Closing Date.
5.2.2. All representations and warranties of City contained in this Agreement shall
be accurate as of the Closing Date.
5.2.3. There shall be no uncured default by City of any of its obligations under
this Agreement as of the Closing Date, not otherwise waived by Seller.
If any contingency contained in this Section 5.2 has not been satisfied on or before
the date described herein, and if no date is specified, then the Closing Date, then
this Agreement may be terminated by written notice from Seller to City. If
termination occurs all documents deposited by City shall be immediately returned
to City, and all documents deposited by Seller shall be immediately returned to
Seller and neither party will have any further rights or obligations with respect to
this Agreement or the Property, except for such obligations that survive termination
of this Agreement. If Seller terminates this Agreement as a result of a failure of a
Seller contingency prior to the applicable date, the Earnest Money shall be returned
to City. All the contingencies in this Section 5.2 are specifically for the benefit of
Seller, and Seller shall have the right to waive any contingency in this Section 5.2
by written notice to City.
6. Closing. The Closing of the purchase and sale contemplated by this Agreement
(“Closing”) shall occur on or before February 28, 2025 (“Closing Date”), unless otherwise
agreed to by the parties. Seller agrees to deliver legal and actual possession of the Property
to City on the Closing Date.
6.1. Seller’s Closing Documents and Deliveries. On the Closing Date, Seller shall
execute and/or deliver, as applicable, to City the following:
6.1.1. Warranty Deed. A warranty deed, with state deed tax paid, conveying title
to the Property to City, free and clear of all encumbrances, except the
Permitted Encumbrances (the “Deed”).
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6.1.2. Assignment and Assumption of Leases, Contracts, Permits and
Licenses. If consent is authorized by the City, Seller shall execute an
assignment and assumption of leases, surviving contracts, permits and
licenses, warranties, and intangible property conveying to City with
warranties the surviving contracts, permits and licenses, warranties and
intangible property, free and clear of all encumbrances, together with the
consent of all parties having the right to consent to such assignment, if
necessary.
6.1.3. FIRPTA Affidavit. An affidavit of Seller certifying that Seller is not a
“foreign person”, “foreign partnership”, foreign trust”, “foreign estate” or
“disregarded entity” as those terms are defined in Section 1445 of the
Internal Revenue Code of 1986, as amended.
6.1.4. Seller’s Affidavit. A standard owner’s affidavit (ALTA form) from Seller
which may be reasonably required by Title to issue an owner’s policy of
title insurance with respect to the Property with the so-called “standard
exceptions” deleted.
6.1.5. Bring-Down Certificate. A certificate dated as of the Closing Date, signed
by an authorized officer of Seller, certifying that the representations and
warranties of Seller contained in this Agreement are true as of the Closing
Date.
6.1.6. Settlement Statement. A settlement statement with respect to this
transaction.
6.1.7. General Deliveries. All other documents reasonably determined by Title
to be necessary to transfer the Property to City and to evidence that Seller
(a) has satisfied all indebtedness with respect thereto, (b) has obtained such
termination statements or releases from such secured creditors as may be
necessary to ensure that the Property is subject to no liens or encumbrances,
(c) has obtained all consents from third parties necessary to effect the terms
of this Agreement, including, without limitation, the consents of all parties
holding an interest in the Property, (d) has provided such other documents
as are reasonably determined by Title to be necessary to issue policies of
title insurance to City with respect to the Property with the so-called
“standard exceptions” deleted, and (e) has duly authorized the transactions
contemplated hereby.
6.1.8. Lease Termination or Assignment. Documents evidencing termination or
assignment of all existing leases of the Property as between Seller and any
tenants.
6.2. City Closing Documents and Deliveries. On the Closing Date, City shall execute
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and/or deliver, as applicable, to Seller the following:
6.2.1. Payment of Purchase Price. The Purchase Price, in accordance with the
terms of Section 1.2.
6.2.2. FIRPTA Affidavit. An affidavit of City certifying that City is not a
“foreign person”, “foreign partnership”, foreign trust”, “foreign estate” nor
a “disregarded entity” as those terms are defined in Section 1445 of the
Internal Revenue Code of 1986, as amended.
6.2.3. City’s Affidavit. A standard owner’s affidavit (ALTA form) from City
which may be reasonably required by Title to issue an owner’s policy of
title insurance with respect to the Property with the so-called “standard
exceptions” deleted.
6.2.4. Bring-Down Certificate. A certificate dated as of the Closing Date, signed
by an authorized officer of City, certifying that the representations and
warranties of City contained in this Agreement are true as of the Closing
Date.
6.2.5. Settlement Statement. A settlement statement with respect to this
transaction.
6.2.6. General Deliveries. All other documents reasonably determined by Title
to be necessary to evidence that City has duly authorized the transactions
contemplated hereby and evidence the authority of City to enter into and
perform this Agreement and the documents and instruments required to be
executed and delivered by City pursuant to this Agreement, or may be
required of City under applicable law, including any purchaser’s affidavits
or revenue or tax certificates or statements.
7. Prorations. Seller and City agree to the following prorations and allocation of costs
regarding this Agreement:
7.1. Title Evidence and Closing Fee. Seller will pay all costs of the Title Commitment
with respect to the Property. City will pay all costs of the Survey, if any, and all
premiums for any title insurance policy it desires with respect to the Property. Seller
and City shall each pay one-half (1/2) of any reasonable closing fee or charge
imposed by Title.
7.2. Transfer Taxes. Seller shall pay all state deed tax and conservation fee regarding
the Deed.
7.3. Recording Costs. Seller will pay the cost of recording all documents necessary to
place record title to the Property in Seller including, but not limited to, costs of
recording any documents necessary to cure any Objections, as hereinafter defined.
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City will pay all recording costs with respect to the recording of the Deed.
7.4. Real Estate Taxes and Special Assessments. General real estate taxes applicable
to any of the Property due and payable in the year of Closing shall be prorated
between Seller and City on a daily basis as of 12:00 a.m. CT on the Closing Date
based upon a calendar fiscal year, with Seller paying those allocable to the period
prior to the Closing Date and City being responsible for those allocable to the
Closing Date and subsequent thereto. Except as set forth herein with regard to
special assessments associated with City’s development of the Property, City shall
pay in full all special assessments (and charges in the nature of or in lieu of such
assessments) levied, pending, postponed or deferred with respect to any of the
Property as of the Closing Date. City shall be responsible for any special
assessments that are levied or become pending against the Property after the
Closing Date. Notwithstanding anything to the contrary set forth herein, in the
event that there are special assessments levied against the Property after the
Effective Date, which special assessment relate to City’s development of the
Property, such special assessments shall be assumed by City at Closing.
7.5. Attorneys’ Fees. Seller and City shall each pay its own attorneys’ fees incurred in
connection with this transaction.
7.6. Survival. The obligations set forth in this Section 7 survive the Closing.
8. Title Examination. Within a reasonable time following the Effective Date, City shall
obtain the following: (i) a commitment for an owner’s title insurance policy (ALTA
Form 2006) issued by Title for the Property, and copies of all encumbrances described in
the commitment (Commitment); and, if it desires, (ii) an ALTA-certified survey bearing
the legal description of the Property, and showing the area, dimensions and location of the
Property (Survey) (the Survey together with the Commitment shall be known as the “Title
Evidence”).
8.1. City’s Objections. Within twenty (20) calendar days after City’s receipt of the last
of the Title Evidence, or twenty (20) days after the date of execution of this
Agreement, whichever occurs later, City may make written objections (Objections)
to the form or content of the Title Evidence. The Objections may include without
limitation, any easements, restrictions or other matters which may interfere with
City’s intended use of the Property or matters which may be revealed by the Survey.
Any matters reflected on the Commitment which are not objected to by City within
such time period shall be deemed to be permitted encumbrances (Permitted
Encumbrances). City shall have the renewed right to object to the Commitment as
the same may be revised or endorsed from time to time.
8.2. Seller’s Cure. Seller shall be allowed twenty (20) calendar days after the receipt
of City’s Objections to cure the same but shall have no obligation to do so. If such
cure is not completed within said period, or if Seller elects not to cure such
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Objections, City shall have the option to do any of the following:
8.2.1. Terminate this Agreement with respect to all of the Property.
8.2.2. Waive one (1) or more of its Objections and proceed to Closing.
If City so terminates this Agreement, neither Seller nor City shall be liable to the other for
any further obligations under this Agreement and any amount previously paid by City to
Seller shall be refunded to City.
9. Warranties and Representations.
9.1. By Seller. Seller warrants and represents the following to City, and acknowledges
that City has relied on such representations and warranties in agreeing to enter into
this Agreement:
9.1.1. This Agreement has been duly executed and delivered and constitutes the
legal, valid and binding obligation of Seller enforceable in accordance
with its terms. Seller has the requisite power and authority to enter into
and perform this Agreement and the documents and instruments required
to be executed and delivered by Seller pursuant hereto. This Agreement
and the documents and instruments required to be executed and delivered
by Seller pursuant hereto have each been duly authorized by Seller and
such execution, delivery and performance does and will not conflict with
or result in a violation of any judgment or order.
9.1.2. The execution, delivery and performance by Seller of this Agreement will
not (a) violate any provision of any law, statute, rule or regulation or any
order, writ, judgment, injunction, decree, determination or award of any
court, governmental agency or arbitrator presently in effect having
applicability to Seller, or (b) result in a breach of or constitute a default
under any indenture, loan or credit agreement or any other agreement,
lease or instrument to which Seller is a party or by which it or any of its
properties may be bound.
9.1.3. To Seller’s knowledge, except as contemplated herein, no order, consent,
approval, license, authorization or validation of, or filing, recording or
registration with, or exemption by, any governmental or public body or
authority, or any other entity, is required on the part of Seller to authorize,
or is required in connection with, the execution, delivery and performance
of, or the legality, validity, binding effect or enforceability of, this
Agreement.
9.1.4. To Seller’s knowledge, there are no actions, suits or proceedings pending
or threatened against or affecting Seller or the Property, before any court
or arbitrator, or any governmental department, board, agency or other
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instrumentality which in any of the foregoing (a) challenges the legality,
validity or enforceability of this Agreement, or (b) if determined adversely
to Seller, would have a material adverse effect on the ability of Seller to
perform its obligations under this Agreement.
9.1.5. To Seller’s knowledge, there are no wells or sewage treatment systems
located on any portion of the Property. To Seller’s knowledge, there has
been no methamphetamine production on or about any portion of the
Property. To Seller’s knowledge, the sewage generated by the Property,
if any, goes to a facility permitted by the Minnesota Pollution Control
Agency and there is no “individual sewage treatment system” (as defined
in Minnesota Statutes § 115.55, Subd. 1(g)) located on the Property.
9.1.6. Seller is not a “foreign person,” “foreign corporation,” “foreign trust,”
“foreign estate” or “disregarded entity” as those terms are defined in
Section 1445 of the Internal Revenue Code.
9.1.7. To Seller’s knowledge, except as may be disclosed as part of the Due
Diligence Materials, (i) no condition exists on the Property that may
support a claim or cause of action under any Environmental Law (as
defined below) and there are no Hazardous Substances (as defined below)
on the Property, (ii) there has been no release, spill, leak or other
contamination or otherwise onto the Property, and (iii) there are no
restrictions, clean ups or remediation plans regarding the Property. To
Seller’s knowledge, except as may be disclosed as part of the Due
Diligence Materials, there is no buried waste or debris on any portion of
the Property. “Environmental Law” shall mean (a) the Comprehensive
Environmental Response Compensation and Liability Act of 1980, 42
U.S.C. § 9601-9657, as amended, or any similar state law or local
ordinance, (b) the Resource Conservation and Recovery Act of 1976, 42
U.S.C. § 6901, et seq., (c) the Federal Water Pollution Control Act, 33
U.S.C. § 1251 et seq., (d) the Clean Air Act, 42 U.S.C. § 7401, et seq., (e)
the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., (f) the Safe
Drinking Water Act, 42 U.S.C. § 300(f) et seq., (g) any law or regulation
governing aboveground or underground storage tanks, (h) any other
federal, state, county, municipal, local or other statute, law, ordinance or
regulation, including, without limitation, the Minnesota Environmental
Response and Liability Act, Minn. Stat. § 115B.01, et seq., (i) all rules or
regulations promulgated under any of the foregoing, and (j) any
amendments of the foregoing. “Hazardous Substances” shall mean
polychlorinated biphenyls, petroleum, including crude oil or any fraction
thereof, petroleum products, heating oil, natural gas, natural gas liquids,
liquefied natural gas or synthetic gas usable for fuel, and shall include,
without limitation, substances defined as “hazardous substances,” “toxic
substances,” “hazardous waste,” “pollutants or contaminants” or similar
substances under any Environmental Law.
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9.1.8. There are no unrecorded contracts of any nature or type relating to,
affecting or serving the Property, to which the Seller is a party.
9.1.9. There will be no indebtedness attributable to the Property which will
remain unpaid after the Closing Date.
The representations, warranties and other provisions of this Section 9.1 shall
survive Closing for a period of one (1) year from the Closing Date; provided,
however that Seller shall have no liability with respect to a breach of the
representations and warranties set forth in this Agreement if City has actual
knowledge of Seller’s breach thereof prior to Closing and City consummates the
acquisition of the Property as provided herein.
City acknowledges and agrees that, except as expressly specified in this Section 9
of this Agreement, Seller has not made, and Seller hereby specifically disclaims,
any representation, warranty or covenant of any kind, oral or written, expressed or
implied, or rising by operation of law, with respect to the Property, including but
not limited to, any warranties or representations as to the habitability,
merchantability, fitness for a particular purpose, title, zoning, tax consequences,
physical or environmental condition, utilities, valuation, governmental approvals,
the compliance of the Property with governmental laws, the truth, accuracy or
completeness of any information provided by or on behalf of Seller to City, or any
other matter or item regarding the Property. City agrees to accept the Property and
acknowledges that the sale of the Property as provided for herein is made by Seller
on an “AS IS,” “WHERE IS,” and “WITH ALL FAULTS” basis. The limitations
set forth in this paragraph shall survive the Closing and shall not merge in the deed.
9.2. By City. City warrants and represents the following to Seller, and acknowledges
that Seller has relied on such representations and warranties in agreeing to enter
into this Agreement:
9.2.1. City has all requisite authority to enter into this Agreement and to perform
all of its obligations under this Agreement.
9.2.1. The execution, delivery and performance by City of this Agreement will not
(a) violate any provision of any law, statute, rule or regulation or any order,
writ, judgment, injunction, decree, determination or award of any court,
governmental agency or arbitrator presently in effect having applicability to
City, (b) violate or contravene any provision of the articles of incorporation
or bylaws of City, or (c) result in a breach of or constitute a default under
any indenture, loan or credit agreement or any other agreement, lease or
instrument to which City is a party or by which it or any of its properties
may be bound.
The representations, warranties and other provisions of this Section 9.2 shall
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survive Closing; provided, however, City shall have no liability with respect to any
breach of a particular representation or warranty if Seller shall fail to notify City in
writing of such breach within one (1) year after the Closing Date.
10. Additional Obligations of Seller.
10.1. Licenses and Permits. With consent of City, Seller shall transfer to City all
transferable rights, if any, in any permits or licenses held by Seller with respect to
the Property.
10.2. Condition of Property at Closing. On the Closing Date, Seller shall deliver to
City exclusive possession of the Property. Seller agrees that following the Closing,
City may dispose of any trash or personal property remaining on the Property, in
City’s sole discretion, and that any such items shall, after Closing, be considered
abandoned. Seller shall indemnify City for a period of one (1) year with regard to
claims of conversion brought with respect to personal property present on the
Property at Closing. Seller shall be allowed to remove the rooftop units within a
reasonable time after notice from the City that the Property is vacant. If the rooftop
units are not removed within the time specified in the City’s notice, they shall be
considered abandoned.
10.3. Further Assurances. From and after the Closing Date, Seller agrees to execute,
acknowledge and deliver to City such other documents or instruments of transfer
or conveyance as may be reasonably required to carry out its obligations pursuant
to this Agreement.
10.4. Non-Assumption of Contracts or Other Obligations. The parties understand
and agree that City is only acquiring certain of Seller’s real property assets and that
this Agreement and any related agreements shall not be construed to be in any
manner whatsoever an assumption by City of any agreements, indebtedness,
obligations or liabilities of Seller which are owing with respect to the operation of
the Property prior to the Closing Date.
10.5. Mortgages. On or before the Closing Date, Seller shall satisfy all mortgage and/or
lien indebtedness with respect to all or any portion of the Property and shall obtain
recordable releases of the Property from any and all such mortgages or other liens
affecting all or any portion of the Property. Notwithstanding the foregoing, Seller
shall not be obligated to satisfy any liens that result from City’s Investigations.
10.5 Marketing. At all times prior to the Closing Date, Seller shall not negotiate in any
manner for the sale or transfer of the Property with any third party.
11. No Broker. It is acknowledged that there is not a broker for City. It is acknowledged that
Sellers are licensed real estate professionals. Seller shall pay any commission due to
Seller’s licensed real estate professionals at closing.
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12. Notice. Any notice to be given by one party hereto shall be personally delivered (including
messenger delivery) or be sent by registered or certified mail, or by a nationally recognized
overnight courier which issues a receipt, in each case postage prepaid, to the other party at
the addresses in this Section (or to such other address as may be designated by notice given
pursuant to this Section), and shall be deemed given upon personal delivery, three (3) days
after the date postmarked or one (1) business day after delivery to such overnight courier.
If to City: City of Hastings
Attn: City Administrator
101 4th Street East
Hastings, MN 55033
with a copy to: Korine L. Land
LeVander, Gillen & Miller, P.A.
633 South Concord Street, Suite 400
South St. Paul, MN 55075
If to Seller: JoCor Holdings LLC
Attn: Joseph T. Schnell
223 S Broad St Ste #103
Mankato, MN 56001
with a copy to:
13. Default; Remedies. If either Seller or City fails to perform any of their respective
obligations under this Agreement in accordance with its terms, and such failing party does
not cure such failure within thirty (30) days after written notice thereof from the other party
(provided that no notice or cure period shall be required for obligations to be performed at
Closing), then the other party shall have the right to terminate this Agreement by giving
the failing party written notice of such election. In the case of any default by City, Seller’s
sole and exclusive remedy shall be termination of this Agreement as provided above and
retention of Earnest Money. In the case of any default by Seller, the Earnest Money shall
be returned to City and City shall also have the right to specifically enforce this Agreement.
14. Cumulative Rights. No right or remedy conferred or reserved to Seller or City is intended
to be exclusive of any other right or remedy herein or by law provided, but each shall be
cumulative in and in addition to every other right or remedy existing at law, in equity or
by statute, now or hereafter.
15. Entire Agreement; Modification. This written Agreement constitutes the complete
agreement between the parties with respect to this transaction and supersedes any prior oral
or written agreements between the parties regarding this transaction. There are no verbal
agreements that change this Agreement and no waiver of any of its terms will be effective
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unless in a writing executed by the parties.
16. Binding Effect; Survival. This Agreement binds and benefits the parties and their
respective successors and assigns. City may not assign this Agreement without the prior
written consent of the Seller. All representations and warranties, and indemnification
obligations of the parties hereto shall survive the Closing.
17. Governing Law. The provisions of this Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota. Any legal action related to this
Agreement shall be venued in Dakota County District Court.
18. Rules of Interpretation. The words “herein” and “hereof” and words of similar import,
without reference to any particular section or subdivision, refer to this Agreement as a
whole rather than any particular section or subdivision hereof. References herein to any
particular section or subdivision hereof are to the section or subdivision of this Agreement
as originally executed.
19. Titles of Sections. Any titles of the sections, or any subsections, of the Agreement are
inserted for convenience of reference only and shall be disregarded in construing or
interpreting any of its provisions.
20. Counterparts; Facsimiles. This Agreement may be executed in any number of
counterparts, and all of the signatures to this Agreement taken together shall constitute one
and the same agreement, and any of the parties hereto may execute such agreement by
signing any such counterpart. Facsimile or “PDF” signatures on this Agreement shall be
treated as originals.
21. Represented by Counsel. Each party confirms that it has had the opportunity to be
represented and advised by counsel in this transaction.
22. Time of the Essence. Time is of the essence of this Agreement.
23. 1031 Exchange. Either party may elect to enter into the transaction contemplated under
this Agreement as part of a like-kind exchange within the meaning of Section 1031 of the
Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.
Seller and Buyer agree to cooperate reasonably with each other in order to implement any
such exchange provided that: (a) the Closing shall not be delayed or affected by reason of
such exchange nor shall the consummation or accomplishment of the exchange be a
condition precedent or condition subsequent to any party’s obligations under this
Agreement; and (b) no party shall be required to acquire or hold title to any real property
for purposes of consummating the other party’s exchange. The parties acknowledge that
any exchange shall be at no cost to the non-exchanging party and shall not release or
diminish their respective obligations and liability under this Agreement.
[remainder of page intentionally left blank]
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IN AGREEMENT, the parties hereto have hereunto set their hands as of the date
hereinbefore first written.
SELLER:
JOCOR HOLDINGS LLC
By
Joseph T. Schnell
Manager
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CITY:
CITY OF HASTINGS
By ________________________________
Mary Fasbender
Its Mayor
By ________________________________
Kelly Murtaugh
Its City Clerk
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
Real property located in Dakota County Minnesota legally described as follows:
[Title Commitment legal description to govern]
Abstract Property
PIDs: 19-02900-05-010
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