HomeMy WebLinkAbout9.a. Public Private Partnership project consideration
EXECUTIVE SUMMARY
City Council Regular Meeting: April 5, 2022
AGENDA ITEM: Consider Public Private Partnership to AGENDA SECTION:
facilitate Recreation Center project New Business
PREPARED BY: Logan Martin, City Administrator
AGENDA NO. 9.a.
Dan Schultz, Park & Rec Director
ATTACHMENTS: Letter of Intent; Land Purchase & Sale
APPROVED BY: LJM
Agreement
RECOMMENDED ACTION:
Motion to approve a Letter of Intent for a Recreational Facility Lease with LTF Lease
Company, LLC.
Motion to approve a Purchase Agreement with Akron 42, LLC to acquire approximately 29
acres in the northeast quadrant of Akron Avenue and Hwy 42.
BACKGROUND
The City has been working for many years to respond to resident demands for increased indoor recreation
amenities and spaces. After a considerable amount of work, City staff are prepared to recommend a Letter
of Intent (LOI) be authorized with a private operational partner, as well as a purchase agreement to
acquire the land for this facility.
A complete history on this initiative would be lengthy, but records dating back to 2008 show that a
number of public, private, and non-profit options to fulfill this need have been explored. More recently,
the City engaged market analyst Ballard King in 2017 to do a full analysis of the City’s market viability for
recreation amenities along with an exploration of various options to operate a facility.
The Ballard King study confirmed a few key factors. First, there is a strong market demand for
recreational, fitness, and athletic facilities in Rosemount. The City’s demographics indicate a higher than
typical rate of families with young children, a younger population overall compared to the national average,
and a higher than typical median household income. Diving deeper, the analysis utilized consumer
spending trends to assert that Rosemount families have an untapped “spending potential index” in the
entertainment and recreation category.
Ballard King then worked with an architect to consider construction and operation options for a
recreational facility. Ultimately, it was determined that the City would lose a significant amount (over
$500,000) annually if it chose to operate a facility. A variety of factors lead to this revenue loss, including
the high overhead needed to staff an 87,000 S.F. facility, an estimated $29 million construction, the City’s
inability to garner market-rates for memberships due to our lack of name-brand recognition, and on-going
costs to maintain and upkeep a facility. Based on this realization, the City Council directed staff to pursue
operational partners for a facility.
Partnership Opportunities
Numerous possible partnerships were explored by the City for this project. One option included engaging
a private staffing agency to provide employees for the various roles within the facility. The option that
received the most initial consideration and investigation was to partner with a non-profit recreation
provider. In that scenario, the City would construct and own a 60,000 S.F. facility, with daily operations
executed by the non-profit. The City would evenly share all maintenance costs and would be exposed to
potential annual costs if the facility had a net-negative revenue report.
The last scenario explored was a public private partnership with an operator. In this scenario, the City
contributes 50% of the construction costs, with the private operator paying the remaining 50%. The
operator would also be fully responsible for all ongoing maintenance, site upkeep, and annual operational
revenue loss. A table comparing options is below.
Non-Profit Operator Private Operator
City Cost toward construction $21,000,000 $21,000,000
Building Size 60,000 S.F. 107,000 S.F.
Annual Building and Site Maint. $225,000 / year $0
Long-Term Saving for Maint. $195,000 / year $0
Property Taxes Received $0 +/- $250,000 (1/3 rec’d by City)
Annual Lease Payment $0 $600,000 / year (approx.)
(after bonds are paid off)
When considering the financial benefits, increased amenities provided, and the economic development
impact to the area, the public private partnership option is the preferred route. As such, the City engaged
in conversations with an operator on this opportunity.
The operator the City is proposing to partner with is Life Time Inc. Life Time is a Minnesota based
athletic club operator with over 180 clubs nationwide, and they have proven themselves as a premier
provider of these facilities. Staff has met with Life Time officials on a regular basis over the last 2 years to
finalize the details of this arrangement, and we are excited about this opportunity and the impact it will
have on the City.
Letter of Intent
The two parties have established a Letter of Intent (LOI) that memorializes the partnership developed
between the City and Life Time. This is a non-binding LOI that will be utilized to establish the long-term
lease arrangement with Life Time. A summary of the deal points is below.
Life Time will operate an approx. 107,000 SF facility featuring indoor / outdoor pool and water
slides, indoor and outdoor café / bistro (with liquor sales), exercise facilities, gyms, outdoor
pickleball courts, child’s play areas, salon and day spa, etc.
Estimated Project cost of $48 million
o City contributes $21 million
o Life Time funds $27 million
City owns the building and retains the asset in perpetuity
o Life Time leases the building from the City
o Annual lease payment is equal to their portion of the bond payment (i.e. payments for the
$27 million portion of the debt)
o City acts as financial lender for the deal, utilizing bond capacity to acquire funds. City
assumes risk of lease default by operator. A new tenant would be pursued in that instance,
or the sale of the City-owned asset would occur to pay off any remaining bond debt.
Life Time pays to furnish and maintain the building for the life of the lease
o No annual City costs to maintain or repair the building or grounds
Rosemount residents receive the following benefits:
o No initiation fee
o Reduced monthly rates ($10 off for individual, $15 off for couple, $20 off for family)
o Optional “summer membership” from June – August reduced by $50 for individuals, $75
for couples, and $75 for families (to support pool utilization and span the summer break
for students)
o 4 guests passes per household annually for the first 5 years
o A scholarship fund will be created (funded by City and Life Time) to assist a segment of
families in need
Life Time pays all taxes and utilities (estimated $250,000 a year in taxes)
30-year lease, with renewal options
o Annual lease in years 31-40 will be ½ of the debt service payment (approx. $600,000 to
$700,000 based on final bond amounts)
If approved by the City Council, the terms of the LOI will be transitioned into a Lease Agreement with
Life Time. The Lease will be considered by their Board of Directors in May, with authorization by the
City Council coming thereafter.
Land Sale
The parcel of land considered for this project has consistently remained the northeast quadrant of Akron
Ave. and Hwy 42. Staff has negotiated with the land owners of that parcel, and a proposed Purchase
Agreement is attached and recommended for approval. The agreement sets the land price at $135,000 per
acre, which is a fair market value as confirmed by a market study. The entire site is approximately 29
acres, with approximately 11 acres needed for the Life Time project.
The purchase agreement encompasses the entire site, which provided an easier transaction and the site
control desired in order to master plan the entire quadrant. The City is responsible for acquiring the
acreage needed for the Life Time project, and we will be assigning the purchase opportunity to a
development partner that we’ve engaged who has interest in developing the remainder of the site.
A number of contingencies remain in the land sale agreement in order to protect the City and our partners.
A traditional due diligence period of 120 days is in place to secure land use approvals and complete a site
analysis. Most importantly, the land sale is contingent upon the City finalizing operation and lease
agreements with Life Time. It is also contingent upon our ability to attain bond financing to complete the
construction of the project.
As evidenced by the detail of this memo, this has been a very lengthy process and is highly complex. The
actions requested of the City Council on April 5 will serve as a major milestone in this project, however it
will not finalize the transaction and is not the last action of the City Council. Future important steps will
be action by the Life Time Board of Directors in May, a subsequent Lease Agreement approval in mid-
summer, land use applications for the actual project, and final construction bids and bond financing to
complete the work.
If the project receives approvals across all required steps over the coming months, site preparation would
begin this fall, with construction spanning all of 2023. A facility would be open to guests in early 2024.
RECOMMENDATION
Staff recommends the City Council approve a Letter of Intent for a Recreational Facility Lease with LTF
Lease Company, LLC. Staff also recommends a motion to approve a Purchase Agreement with Akron
42, LLC to acquire approximately 29 acres in the northeast quadrant of Akron Avenue and Hwy 42.
CITY OF ROSEMOUNT
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2022-38
A RESOLUTION APPROVING A LETTER OF INTENT
FOR A RECREATIONAL FACILITY LEASE WITH LTF LEASE COMPANY, LLC
WHEREAS, LTF Lease Company, LLC, a Delaware limited liability company (“Tenant”) has
proposed that the City of Rosemount, Minnesota (the “City”) construct an approximately 107,000
square foot health and fitness facility with outdoor recreational uses to be located at the NE corner
of 145th Street West and Akron Avenue, Rosemount, Minnesota (the “Project”) to be leased to the
Tenant; and
WHEREAS, both the City and the Tenant desire to approve the Letter of Intent (the “Letter of
Intent”) outlining the terms for the construction, leasing and financing of the Project to be set forth
in a definitive lease and related documents.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Rosemount,
Minnesota (the “Council”), as follows:
1. The Letter of Intent as presented to the Council is hereby approved in all respects, in
substantially the form submitted, and the City Administrator is hereby authorized and directed to
negotiate definitive agreements consistent with the Letter of Intent on behalf of the City for future
consideration by the Council, and hereby authorizes the Mayor and the City Clerk to execute, on
behalf of the City, the acceptance of the Letter of Intent.
2. The approval hereby given to the Letter of Intent includes approval of such additional
details therein as may be necessary and appropriate and such modifications thereof, deletions
therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel
to the City and by the City Administrator, subject to the following conditions: (a) such modifications
do not materially adversely affect the interests of the City; and (b) such modifications do not
contravene or violate any policy of the City or applicable provision of law. This Resolution and the
Letter of Intent shall not constitute an offer and shall not be binding on the City until the date of
execution of the definitive agreements as provided in the resolution approving such definitive
agreements.
3. As set forth in the Letter of Intent, execution of definitive agreements and any proposed
obligations of the City thereunder are subject to satisfaction of conditions precedent thereto
including, without limitation, approval by the City Council after a public hearing as required by
Minnesota law.
RS125-24-784661.v2
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ADOPTED this 5 day of April, 2022.
_______________________________________
William H. Droste, Mayor
ATTEST:
Jessie Paque, Deputy City Clerk
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CERTIFICATION
STATE OF MINNESOTA )
COUNTY OF DAKOTA ) ss
CITY OF ROSEMOUNT )
I am the duly appointed, acting and qualified Deputy City Clerk of the City of Rosemount, Dakota
County, Minnesota and do hereby certify that I have examined the City of Rosemount records and
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the Minute Book of said City for the meeting of the 5 day of April, 2022. The attached
RESOLUTION APPROVING A LETTER OF INTENT FOR A RECREATIONAL FACILITY
LEASE WITH LTF LEASE COMPANY, LLC was approved by the City Council and is a true and
correct copy of said Resolution.
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IN WITNESS WHEREOF, I have hereunto set my hand and seal of said City this 5 day of
April, 2022.
Jessie Paque, Deputy City Clerk
City of Rosemount
Dakota County, Minnesota
RS125-24-784661.v2
April 1, 2022
Mr. Logan Martin
City Administrator
City of Rosemount
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2875 145 Street West
Rosemount, MN 55068-4997
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Re: Property located at the NE Corner of 145 Street West and Akron Avenue, Rosemount,
Minnesota
Dear Mr. Martin:
The following is a summary of the terms and conditions upon which LTF Lease Company, LLC
is willing to commit to lease space at the above-referenced development in accordance with a
mutually acceptable, written lease agreement (referred to herein as the “Lease”). This letter of
intent (“Letter of Intent”) is non-binding except as specifically set forth herein and neither
Landlord (defined below) nor LTF Lease Company, LLC will be bound unless the Lease is
executed, except for those provisions specifically set forth herein.
City of Rosemount, Minnesota, a Minnesota municipal corporation
Landlord:
(“Landlord”)
LTF Lease Company, LLC, a Delaware limited liability company
Tenant:
(“Tenant”). Life Time, Inc., a Minnesota corporation, will
unconditionally guarantee Tenant’s obligations under the Lease.
A to be constructed single-tenant building to be located at the NE
Building:
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corner of 145 Street West and Akron Avenue, Rosemount, MN,
as depicted on Exhibit B attached hereto (the “Building”).
The premises will consist of approximately 107,000 square feet (the
Premises:
entire Building) and include a portion of the land as depicted on
Exhibit A attached hereto, constituting approximately 13 acres (the
“Premises”).
The Premises is part of a larger development as shown on the site
Development:
plan (the “Site Plan”) set forth on Exhibit B attached hereto (the
“Development”). Landlord will own the portion of the
Development depicting the Premises on the Site Plan.
Initial Lease Term: 30 years.
The Initial Lease Term and any Renewal Options are collectively
referred to herein as the “Term”.
Renewal Options: Two, 5-year renewal options.
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Annual Base Rent will be fixed for the Term, as follows:
Annual Base Rent:
INITIAL LEASE TERM ANNUAL BASE RENT
Exact numbers will be added as
an addendum to the Lease when
the Bonds are priced. The
Annual Base Rent will equal the
amount of the annual debt
service payment (principal and
interest) above debt service on
Landlord’s $21MM initial
contribution paid in monthly
installments of 1/12 of such
annual amount. Tenant’s portion
of Bond payments will be
structured to commence after
projected completion date as
determined by Tenant, as
Construction Manager.
RENEWAL OPTIONS
st
1 Renewal Option 50% of the average Annual Base
Rent payable during the last year
of the Initial Lease Term
nd
2 Renewal Option 50% of the average Annual Base
Rent payable during the last year
of the Initial Lease Term
Landlord’s investment in the acquisition and construction of the
Bonds; Cost Over-Runs:
Premises is limited to $21,000,000. Subject to satisfaction of all
conditions required by law, Landlord will obtain General
Obligation Bonds issued in an amount not to exceed $48,000,000
(the “Bonds”). The Bonds will be used to fund the acquisition,
development and construction of the Premises, the Building and
Landlord’s Work. Tenant will be solely responsible for all costs to
acquire, develop and construct the Premises, the Building and
Landlord’s Work in excess of $48,000,000. In the event the costs to
acquire, develop and construct the Premises, the Building and
Landlord’s Work exceed $48,000,000, Tenant will deposit in
escrow with the Title Company (defined below) funds equal to the
amount necessary to pay all costs to acquire, develop and construct
the Premises, the Building and Landlord’s Work in excess of
$48,000,000.
Utilities will be separately metered to the Premises. Tenant will pay
Utilities:
all utility expenses for the Premises during the Term.
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Landlord shall, at its sole cost and expense, create a separate tax
Real Estate Taxes:
parcel for the Premises. Real estate taxes will be separately assessed
for the Premises. Tenant will pay all real estate taxes for the
Premises during the Term, commencing upon the Rent
Commencement Date. Tenant shall pay the real estate taxes for the
Premises directly to the appropriate taxing authority when due.
Maintenance and Tenant shall repair, replace and maintain the Premises (interior and
exterior) and all of Tenant’s personal property therein during the
Insurance:
Term.
Tenant’s obligation to lease the Premises in accordance with the
Tenant’s Contingencies:
Lease is subject to the satisfaction or waiver of each of the
following contingencies (each, a “Tenant’s Contingency,” and
collectively, “Tenant’s Contingencies”) prior to the dates herein
specified (subject to any extensions described below):
(a) Tenant will have a period ending the earlier of (i) one hundred
twenty (120) day inspection from the effective date of the Lease or
(ii) August 17, 2022 (the “Inspection Period”), to review any and
all documents, materials and due diligence information relating to
the Premises, including without limitation, Phase I and Phase II (if
recommended) environmental reports, utilities, protective
covenants, wetlands study, storm water retention/filtration, zoning,
site conditions (including, but not limited to, tree mitigation,
grading, clearing), site planning, review of any association
documents, design guidelines, restrictive covenants or any other
private governing authority documents, feasibility study of the
Premises (collectively, the “Due Diligence Materials”). Subject to
obtaining necessary information from Akron 42, LLC (the
“Seller”), Landlord will respond to any comments or requests from
Tenant regarding the Due Diligence Materials within three (3) days
after receipt of such comment or request;
During the Inspection Period, Tenant will have the right to enter
onto the Premises to conduct any testing of the Premises, subject to
the terms of the Purchase and Sale Agreement regarding the
Premises between Landlord and the Seller (the “PSA”).
Should Tenant at any time during the Inspection Period conclude
that it does not want to proceed with the transaction contemplated
in the Lease for any reason or no reason, then Tenant will notify
Landlord, the Lease shall terminate and Tenant shall have no further
obligations under the Lease. Furthermore, if Landlord has not
received a notice of satisfaction or waiver from Tenant to Landlord,
then the foregoing conditions shall be deemed to have not been
satisfied prior to the expiration of the Inspection Period, the Lease
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shall automatically terminate effective as of the expiration of the
Inspection Period and Tenant shall have no further liability under
the Lease. Notwithstanding the foregoing, if Landlord has not
received a notice of satisfaction or waiver on or prior to expiration
of Inspection Period, Landlord may, within ten (10) days after
expiration of the Inspection Period, send a written notice to Tenant
and Tenant will have ten (10) days after receipt of such notice to
notify Landlord of the non-satisfaction, satisfaction or waiver the
applicable Tenant’s Contingency before the Lease is deemed
automatically terminated.
(b) Prior to the expiration of the Inspection Period, Landlord,
Tenant and all applicable third parties will have agreed upon the
final form of REA to be recorded against the Development at the
time of Landlord’s acquisition of the Premises. The REA will
include, at minimum, the use restrictions set forth on Exhibit C
attached hereto agreed to by private owners of adjacent property in
the Development, Tenant’s exclusive use provision, shared utility
provisions, self-park requirements and related parking restrictions,
and shared signage provisions. Tenant expects the main roadways
within the Development to be private roads.
(c) Upon expiration of the Inspection Period or upon Tenant
waiving Tenant’s Contingencies of the Inspection Period, Landlord
shall obtain, at its sole cost and expense, including payment of all
costs and fees (e.g., development, impact, school, public art, utility
setup, utility connection, etc.) and on behalf of Tenant, the
following approvals within \[Exact timing TBD – deadline will not
exceed the land closing date in the PSA)\] (the “Approval Period”):
any and all final, non-appealable approvals and entitlements from
the City of Rosemount or any other municipality or other third party
to allow the operation and construction of the Health Club (as
defined herein) on the Premises, including without limitation,
zoning, required subdivision(s), access, signage, special use
permits, variances, licenses for outdoor elements of the Health
Club, an on-site presale facility and any other approvals that may
be required for use of the Premises by Tenant as a health and fitness
club of approximately 107,000 square feet, and also including use
of the Premises twenty-four (24) hours a day, seven days a week,
all such approvals not containing any conditions which are not
acceptable to Tenant in its sole discretion and after expiration of
any applicable appeals period (collectively, the “Approvals”);
(d) Prior to expiration of the Approval Period, Landlord and Tenant
will have agreed upon the final form of Construction Management
Agreement to be signed by the parties prior to commencement of
bidding and construction of the Premises (the “Construction
Management Agreement”) pursuant to which Tenant, in
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cooperation with Landlord’s City Engineer, shall agree to provide
at no cost to Landlord, (i) all design and architectural services for
the site plan and plat of the Development, including without
limitation, all utilities and infrastructure for the site, and the
construction of the Building, (ii) prepare bid packets and conduct
public bidding for all work on the Premises and all utilities and
infrastructure in the Development in accordance with MN Stat.
Sections 471.345 – 471.462, and (iii) provide Construction
Management services for all work performed under such contracts.
If Landlord shall be unable to procure any of the Approvals at any
time during the Approval Period or if Tenant determines that all or
any of Tenant’s Contingencies will not be or have not been satisfied
prior to expiration of the Approval Period, Tenant shall have the
option at any time on or prior to expiration of the Approval Period
to either exercise self-help and elect to obtain any remaining
Approvals.
(e) Prior to the date on which Tenant accepts delivery of the
Premises with the Landlord’s Work (as defined herein) complete
(the “Possession Date”), Tenant shall have obtained a leasehold
title insurance policy in form and content acceptable to Tenant from
a title company to be selected by Tenant (the “Title Company”).
(f) Prior to the expiration of the Approval Period, Tenant shall have
obtained approval from the Board of Directors of Life Time, Inc.
(g) Prior to the expiration of the Approval Period \[Exact timing of
Approval Period TBD – deadline will not exceed the land closing
date in the PSA)\], Landlord shall have acquired fee simple title to
the Premises and Mark Nordland (or his approved successors or
assigns) shall have acquired fee simple title to the remainder of the
Development; provided, however, that prior to the expiration of the
Approval Period, Tenant shall execute a contingent assignment of
the PSA with Landlord pursuant to which Tenant will agree to
purchase the remainder of the Development upon satisfaction of all
other Approval Period contingencies to the Lease if Mark Nordland
(or his approved successors or assigns) fails to acquire such
property by the required closing date.
Rent Commencement Tenant’s obligation to pay Rent shall commence on the date Tenant
opens the Health Club (as defined herein) for business in the
Date:
Premises to the general public in accordance with the scheduled
payment dates for the Bonds (the “Rent Commencement Date”).
The Premises shall be operated as a health and fitness facility of
Permitted Use:
approximately 107,000 square feet with outdoor recreation uses,
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including, but not limited to, outdoor pool, water slides, outdoor
café/bistro with seating, outdoor child’s play area, outdoor exercise
areas, outdoor fields and outdoor tennis, indoor pools, indoor tennis,
café/bistro with liquor sales, racquetball/squash, tennis lessons
(both indoor and outdoor), group classes, free weights, weight and
aerobic training, cardio equipment, circuit training, child care, hair
salon, day spa, medi-spa, café/bistro inside the Premises (with food
sales for on-premises and off-premises consumption) with
additional outdoor seating, liquor sales in the Premises, physical
therapy, chiropractic care, medical office, collaborative office, “co-
working” or shared workspace, sale of health and fitness-related
merchandise and/or any other use related to healthy living, healthy
aging, healthy working or a healthy way of life (collectively, the
“Health Club”) including, at Tenant’s option, use of the Premises
twenty-four (24) hours a day, seven (7) days a week, and any other
use compatible with the primary health and fitness facility function
of the Premises and specifically excluding any uses listed in Exhibit
E (collectively, and together with the Health Club, the “Permitted
Use”).
Tenant may not assign the Lease or sublet the whole or any part of
Assignment/Sublet:
the Premises without the prior consent of Landlord, which consent
shall not be unreasonably withheld, delayed, or conditioned.
Tenant shall, however, have the right to enter into an assignment of
the Lease or a sublease of the Premises, without Landlord’s
consent, to (i) an entity controlling, controlled by or under common
control with Tenant, Life Time, Inc. or Life Time Group Holdings,
Inc. including, without limitation, any change in control or
management or an initial public offering of such entity, Tenant, Life
Time, Inc., or Life Time Group Holdings, Inc. or any affiliate
thereof, (ii) an entity which succeeds to Tenant’s or Life Time,
Inc.’s or Life Time Group Holdings Inc.’s business by merger,
consolidation, initial public offering, or other form of corporate
reorganization, (iii) an entity which acquires all or substantially all
of Tenant’s or Life Time, Inc.’s or Life Time Group Holdings Inc.’s
assets or stock, (iv) an entity which acquires one or more of
Tenant’s or Life Time, Inc.’s or Life Time Group Holdings, Inc.’s
locations, or (iv) a real estate investment trust formed by Tenant or
by any entity described in (i), (ii) or (iii) above. Further, Tenant
shall have the right to sublease up to 10% of the leasable square
footage of the Premises for a Permitted Use without Landlord’s
consent.
In the event of an authorized assignment or sublease of the Lease,
Tenant shall be forever released from any further liability and
obligations under the Lease; provided that such assignee shall
unconditionally assume all of Tenant’s obligations under the Lease.
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Pursuant to the Construction Management Agreement, Tenant shall
Landlord’s Work:
agree to provide Landlord with complete drawings, plans and
specifications for the construction of the infrastructure, roads and
related improvements for the Development, including the Premises,
and all of the Landlord’s Work (as defined herein).
Within ten (10) days after the execution date of the Lease, Landlord
agrees to provide Tenant, to the extent in the possession or control
of Landlord or its agents or representatives, the following: (i) a
current ALTA/ACSM Survey of the Development including the
Premises; (ii) soil tests of the Development including the Premises;
(iii) a site plan of the Development including the Premises showing
the location of existing utilities; (iv) a final grading plan for the
Development including the Premises; (v) a copy of Landlord’s title
insurance commitment/policy for the Development including
Premises and all accompanying encumbrance documentation; (vi)
the estimated market value of the tax parcel of which the Premises
will be a part; and (vii) environmental reports for the Development
including the Premises.
Landlord is responsible for any and all off-site work and any and
all off-site costs arising as a result of the Landlord’s Work or
Tenant’s Work to the extent of the proceeds of the Bonds up to
$48,000,000 and subject to the publicly bid contracts and Tenant
shall be responsible for any costs in excess of $48,000,000 to
deliver Landlord’s Work. The Premises (including the Building)
shall be delivered by Landlord to Tenant air-tight, water-tight and
free of hazardous materials.
Landlord shall deliver possession of the Premises to Tenant with all
work described on the attached Exhibit D (“Landlord’s Work”)
complete and acceptable to Tenant to the extent of the proceeds of
the Bonds up to $48,000,000 and subject to the publicly bid
contracts and Tenant shall be responsible for any costs in excess of
$48,000,000 to deliver Landlord’s Work.
Landlord represents that the Landlord’s Work shall be constructed
in a good and workmanlike manner and in accordance with all
applicable zoning, municipal, county, state and federal laws,
ordinances and regulations and any covenants or restrictions of
record (collectively, “Applicable Laws”); provided that Tenant
shall agree to be responsible for ensuring compliance therewith in
its role as Construction Manager under the Construction
Management Agreement.
Landlord agrees to diligently proceed with the Landlord’s Work
and will deliver possession of the Premises to Tenant with the
Landlord’s Work complete no later than \[TBD\]. Tenant
acknowledges that Tenant will manage the construction and
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completion of the Landlord’s Work by such deadline pursuant to
the Construction Management Agreement.
In the event that the Landlord’s Work is not yet fully complete, but
is sufficiently completed so that Tenant can begin Tenant’s Work
(as defined herein) without materially interfering with the
completion of the Landlord’s Work, Tenant will be permitted early
entry to the Premises for the purpose of beginning Tenant’s Work.
Notwithstanding Tenant’s right to early entry to the Premises, the
Possession Date shall not occur until the Landlord’s Work is fully
complete and accepted by Tenant in accordance with the terms of
the Lease.
Landlord shall pay all costs to purchase and develop the Premises
Landlord’s Contribution:
and all hard construction costs to develop and construct the
Premises (including the Building) and the infrastructure for the
Development, including without limitation all infrastructure, on-
site and off-site improvement expenses to the extent of the proceeds
of the Bonds up to $48,000,000 and subject to the publicly bid
contracts and Tenant shall be responsible for any costs in excess of
$48,000,000 to deliver Landlord’s Work. Tenant shall pay for the
soft costs it incurs in its design of the Premises and the
infrastructure planning for the Development (including the
Premises) and the furnishing and installation of Tenant’s desired
fixtures, furniture and equipment in the Building (“Tenant’s
Work”).
Tenant shall have the right, at Tenant’s expense, to install on all
Signage:
building elevations its standard sign package. Tenant shall have the
right to display “opening soon,” “grand opening” and promotional
banners from time to time after execution of the Lease. It is
understood that the Lease is contingent upon applicable local
government authorities’ approval of Tenant’s signage.
Tenant shall have the right, at its sole cost and expense, to install
and maintain its sign panels on the pylon sign and/or monument
sign(s) within the Development. Tenant’s sign panels shall be in the
top panel position on the pylon and/or monument sign(s). Tenant
shall not be obligated to pay for or contribute to the costs of the
initial construction of the pylon and/or monument sign(s). Tenant
or the operator under the REA shall be responsible for the
maintenance and repair of the pylon and/or monument sign
structures and shall also be responsible for providing electricity to
the pylon and/or monument sign(s).
Landlord represents that there will be sufficient parking spaces in
Parking:
the Development for Tenant’s use in addition to all other
tenants/owners/occupants; Tenant acknowledges that the site plan
8
RS125-24-779343.v4
Tenant provides pursuant to the Construction Management
Agreement shall initially address this requirement. The
Development shall not share any parking and each parcel shall park
to code, without variance. Such parking restrictions shall be set
forth in the REA.
The definition of “Force Majeure” in the Lease shall include, but
Force Majeure:
shall not be limited to, plague, epidemic, pandemic, contagion,
outbreaks of infectious disease, the coronavirus \[COVID-19\]
pandemic, or any other public health crisis, and shall include any
quarantine, stay-at-home orders, operational restrictions or
shutdowns, construction-related restrictions, slowdowns or
stoppages, or any other measure taken by any government authority
in response thereto (collectively, a “Public Health Event”). Once
the Bonds have been issued, all Rent shall be due regardless of any
Force Majeure.
Landlord shall provide space for Tenant to place a presale
Presale:
membership trailer at the Premises at least six (6) months prior to
Tenant’s grand opening of the Health Club. The dedicated space
shall be provided free of any costs or expenses.
(1) Tenant will not charge an enrollment fee to residents of the
Resident Incentives:
City of Rosemount to obtain memberships.
(2) During each of the first five years after the City issues a
certificate of occupancy for the Building, Tenant will
cooperate with Landlord to provide up to 4 guest passes per
household within the City of Rosemount. After the initial
five-year period, Tenant and Landlord will re-evaluate the
guest pass benefits.
(3) Tenant and Landlord will work together to establish a
program to make memberships available to residents of the
City of Rosemount that meet certain income qualifications.
(4) Tenant will make available to residents of the City of
Rosemount:
(a) A 3-month membership for the months of June, July and
August, the total cost of which will be discounted by $50
for individual memberships, $75 for couple
memberships, and $100 for a family of 3 or more.
(b) Regular memberships that will be discounted by $10 for
individual memberships, $15 for couple memberships,
and $20 for a family of 3 or more, from the monthly rate
then in effect.
(c) For clarity, residents cannot receive both discounts set
forth in (a) and (b) above in a 12-month period.
Residents may choose only one.
9
RS125-24-779343.v4
Landlord and Tenant represent and warrant to each other that they
Brokerage:
have not dealt with brokers, finders or the like in connection with
this transaction, and agree to indemnify each other and to hold each
other harmless against all claims, damages, costs or expenses of or
for any other such fees or commissions resulting from their actions
or agreements regarding the execution or performance of this
transaction, and will pay all costs of defending any action or lawsuit
brought to recover any such fees or commissions incurred by the
other party, including reasonable attorney’s fees. Provided,
however, that Landlord shall be entitled to consult with commercial
real estate brokers in determining commercially reasonable rental
rates for the Lease at Landlord’s sole cost and expense.
Encumbrances and To Landlord’s knowledge, there are no restrictions, covenants,
easements or other encumbrances on the Development, including
Restrictions:
the Premises.
The Landlord’s $21,000,000 contribution to the cost of the
Business Subsidy:
construction of the Building is a business subsidy and the
requirements of Minnesota Statutes, Sections 116J.993 through
116J.995 (the “Business Subsidy Law”) apply. Landlord and
Tenant will further discuss the wage and job goals under Landlord’s
business subsidy policy and the Business Subsidy Law with respect
to the Premises. Participation and requirements to be determined
in the Lease.
Landlord agrees to utilize Tenant’s lease form as the basis for the
Lease Form:
Lease.
All other terms set forth in the Lease shall be as agreed to by the parties. Please sign below to
indicate your willingness to proceed with negotiations on the terms outlined herein. Should a lease
agreement acceptable to both parties not be executed and delivered to each party, this Letter of
Intent shall be deemed null and void and of no force or effect, and neither party shall have any
liability or obligation to the other based on this Letter of Intent or any discussions between the
parties, whether prior to, contemporaneous with, or subsequent to the execution hereof, except as
specifically set forth herein.
Notwithstanding anything to the contrary in this Letter of Intent, Landlord expressly agrees not to
negotiate with an outside party with respect to a lease or other transaction with respect to the
Premises for a period of ninety (90) days from the date Landlord signs this Letter of Intent and
Landlord expressly agrees that this paragraph is binding between the parties. The individuals
signing this Letter of Intent on behalf of Landlord each warrants that he/she has authority to
execute this Letter of Intent on behalf of Landlord and to bind Landlord accordingly.
Please execute the acceptance below no later than April 6, 2022 or this Letter of Intent will be
deemed withdrawn.
Yours very truly,
10
RS125-24-779343.v4
Aaron Koehler
Vice President, Development
Life Time
Agreed and Accepted this _____ day of April, 2022.
City of Rosemount, Minnesota
By:
Its: Mayor
By:
Its: City Clerk
cc: Kari Broyles, Life Time, Inc.
11
RS125-24-779343.v4
EXHIBIT A
LAND
\[Will be a portion of Outlots J and O, Prestwick Place\]
A-1
RS125-24-779343.v4
EXHIBIT B
SITE PLAN FOR BUILDING, PREMISES AND DEVELOPMENT
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RS125-24-779343.v4
EXHIBIT C
LIST OF PROHIBITED USES UNDER REA
No portion of the Development shall be used for any of the following uses or purposes:
(a) motor vehicle service, fuel or gas stations, motor vehicle repairs including
without limitation any body and fender repair work, car washes, or the displaying, renting,
leasing, or sale of any automobile, truck, boat, trailer or other motor or recreational vehicle
that is not entirely conducted inside of a building;
(b) a venture whose primary business is operation of video or arcade games;
(c) adult book or video store;
(d) health or fitness club, gym or any commercial facility used for physical exercise
or individual or group fitness or athletic training regardless of whether such business
charges membership dues, class fees or any other arrangement;
(e) Yoga studio or facility;
(f) Pilates studio or facility,
(g) cycle studio or facility (e.g. SoulCycle),
(h) Barre studio or facility;
(i) any specialty fitness studio or facility;
(j) boutique gym, fitness training facility (e.g. Orange Theory);
(k) hair salon or nail salon;
(l) day spa/spa, and/or any establishment that offers any or all of the services
typically included in a day spa/spa, including, but not limited to, an operation that provides
any of the following services massage therapy, hydrotherapy, facials, or body treatments,
(m) medi-spa;
(n) chiropractic;
(o) physical therapy;
(p) sale of nutritional products or supplements;
(q) weight loss clinic;
(r) café or restaurant whose food offerings primarily consist of organic and/or
healthy food offerings;
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RS125-24-779343.v4
(s) collaborative office, “co-working” or shared workspace use;
(t) a pet store or overnight boarding pet daycare and/or facilities;
(u) warehouse or industrial use;
(v) self-storage facility;
(w) fast food restaurant (e.g. McDonald’s);
(x) any use with a drive-through other than (A) a coffee shop (for example,
Starbucks or Caribou Coffee), (B) banking facilities, (C) cleaners, if otherwise permitted
herein), or pharmacies (such as CVS or Walgreens);
(y) liquor store,
(z) bar, restaurant or other establishment whose liquor sales exceed 15% of its gross
revenues;
(aa) convenience store;
(bb) establishment for the sale of guns or other firearms;
(cc) tattoo or piercing parlor;
(dd) so-called “head shops,” which are defined as facilities primarily used for
selling products intended to assist, aid, or used in conjunction with the consumption of
illegal drugs;
(ee) sale or provision of marijuana, whether for therapeutic, medicinal or
other purposes;
(ff) any public or private nuisance;
(gg) any obnoxious odor except customary odors emanating from restaurants;
(hh) any fire, explosion or other damaging or dangerous hazard, including the
storage, display, or sale of explosives or fireworks;
(ii) any distillation (other than so-called micro-brewing of beer), refining,
smelting, agriculture or mining operations;
(jj) any mobile home or trailer court, labor camp, junk yard, stock yard or animal
raising; provided, however, that, notwithstanding the foregoing, pet shops shall be
permitted;
(kk) any drilling for and/or removal of subsurface substances;
C-4
RS125-24-779343.v4
(ll) any dumping of garbage or refuse, other than in enclosed receptacles intended
for such purpose;
(mm) any cemetery, mortuary or similar service establishment;
(nn) any fire sale, bankruptcy sale (unless pursuant to a court order) or auction
operation;
(oo) any church, synagogue, mosque or other place of worship or other religious
use;
(pp) any entertainment, recreation or amusement use, whether directed to
children or adults, including, but not limited to, any one or more of the following: theatre,
skating rink, bowling alley, teenage discotheque, discotheque, dance hall, video game
parlor, pool room, massage parlor, off-track betting facility, casino, card club, bingo parlor,
facility containing gaming or gambling equipment, planned play environment, arcade
games, amusement gallery, rides, video or redemption games, play for fun casino games,
golf simulations, rodeo simulations, other sport simulations and carnival activities;
(qq) any school, training, or educational facility, including but not limited to:
beauty schools, barber colleges, nursery schools, day cares, diet centers, reading rooms,
places of instruction or other operations catering primarily to students or trainees rather
than to customers; provided however, this prohibition shall not be applicable to on-site
employee training by an occupant incidental to the conduct of its business, a learning center
for children and teenagers such as Sylvan Learning Center, any school affiliated with an
accredited public university, college, or junior college;
(rr) any second-hand or thrift stores, or flea markets;
(ss) any dry cleaning facilities utilizing hazardous substances with an on-
premises plant; provided, however, that nothing contained herein shall preclude a drop-
off/pick-up dry cleaning business as long as no cleaning services are conducted at such
location;
(tt) warehousing or storage facilities of any kind unless incidental to another use
permitted on the premises;
(uu) call center or similar use; and
(vv) use or occupancy of a building by a discount or reduced-price general or
specialty retailer or merchandiser, including, but not limited to, Wal-Mart, K-Mart, Sam’s
Club, T. J. Maxx, or Marshall’s.
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RS125-24-779343.v4
EXHIBIT D
LANDLORD’S WORK
Landlord’s Work includes all infrastructure improvements, all off-site improvements, and
construction of the Premises (interior and exterior) pursuant to the approved, Tenant-provided
plans. Tenant will install its customary fixtures, furniture and equipment as the Tenant’s Work.
E-1
RS125-24-779343.v4
EXHIBIT E
LIST OF PROHIBITED USES OF PREMISES
No portion of the Premises shall be used for any of the following uses or purposes:
(a) motor vehicle service, fuel or gas stations, motor vehicle repairs including
without limitation any body and fender repair work, car washes, or the
displaying, renting, leasing, or sale of any automobile, truck, boat, trailer or
other motor or recreational vehicle that is not entirely conducted inside of a
building;
(b) a venture whose primary business is operation of video or arcade games;
(c) adult book or video store;
(d) warehouse or industrial use;
(e) self-storage facility;
(f) liquor store,
(g) establishment for the sale of guns or other firearms;
(h) tattoo or piercing parlor;
(i) so-called “head shops,” which are defined as facilities primarily used for selling
products intended to assist, aid, or used in conjunction with the consumption of illegal
drugs;
(j) sale or provision of marijuana, whether for therapeutic, medicinal or other
purposes;
(k) any public or private nuisance;
(l) any obnoxious odor except customary odors emanating from restaurants;
(m) any fire, explosion or other damaging or dangerous hazard, including the
storage, display, or sale of explosives or fireworks;
(n) any distillation (other than so-called micro-brewing of beer), refining,
smelting, agriculture or mining operations;
(o) any mobile home or trailer court, labor camp, junk yard, stock yard or animal
raising; provided, however, that, notwithstanding the foregoing, pet shops shall be
permitted;
(p) any drilling for and/or removal of subsurface substances;
E-1
RS125-24-779343.v4
(q) any dumping of garbage or refuse, other than in enclosed receptacles intended
for such purpose;
(r) any cemetery, mortuary or similar service establishment;
(s) any fire sale, bankruptcy sale (unless pursuant to a court order) or auction
operation;
(t) any church, synagogue, mosque or other place of worship or other religious use;
(u) any second-hand or thrift stores, or flea markets;
(v) any dry cleaning facilities utilizing hazardous substances with an on-
premises plant; provided, however, that nothing contained herein shall preclude a drop-
off/pick-up dry cleaning business as long as no cleaning services are conducted at such
location;
(w) warehousing or storage facilities of any kind unless incidental to another use
permitted on the premises;
(x) call center or similar use; and
(y) use or occupancy of a building by a discount or reduced-price general or
specialty retailer or merchandiser, including, but not limited to, Wal-Mart, K-Mart, Sam’s
Club, T. J. Maxx, or Marshall’s.
E-1
RS125-24-779343.v4
CITY OF ROSEMOUNT
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2022-37
A RESOLUTION APPROVING A PURCHASE AGREEMENT
WITH AKRON 42, LLC
WHEREAS, the City of Rosemount, Minnesota (the “City”), proposes to acquire real property
legally described as Outlot J and Outlot O, Prestwick Place, Dakota County, Minnesota (the
“Development Site”) in the City;
WHEREAS, Akron 42, LLC, a Minnesota limited liability company (the “Seller”) and the City have
negotiated that certain Purchase and Sale Agreement (the “Purchase Agreement”) for the acquisition
of the Development Site; and
WHEREAS, both the Seller and the City desire to approve the Purchase Agreement in order to
facilitate the acquisition of the Development Site.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Rosemount,
Minnesota, as follows:
1. Subject to all of the contingencies set forth therein, the City Council hereby approves the
Purchase Agreement, and hereby authorizes the Mayor and the City Clerk to execute, on behalf of
the City, the Purchase Agreement and to carry out, on behalf of the City, the City’s obligations
thereunder when all conditions precedent thereto have been satisfied.
2. The approval hereby given to the Purchase Agreement includes approval of such additional
details therein as may be necessary and appropriate and such modifications thereof, deletions
therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel
to the City and by the City Administrator, subject to the following conditions: (a) such modifications
do not materially adversely affect the interests of the City; and (b) such modifications do not
contravene or violate any policy of the City or applicable provision of law. This Resolution shall not
constitute an offer and the purchase agreement shall not be effective until the date of execution
thereof.
th
ADOPTED this 5 day of April, 2022.
_______________________________________
William H. Droste, Mayor
ATTEST:
Jessie Paque, Deputy City Clerk
RS125-24-788373.v2
CERTIFICATION
STATE OF MINNESOTA )
COUNTY OF DAKOTA ) ss
CITY OF ROSEMOUNT )
I am the duly appointed, acting and qualified Deputy City Clerk of the City of Rosemount, Dakota
County, Minnesota and do hereby certify that I have examined the City of Rosemount records and
the Minute Book of said City for the meeting of the 5th day of April, 2022. The attached
RESOLUTION APPROVING A PURCHASE AGREEMENT WITH AKRON 42, LLC was
approved by the City Council and is a true and correct copy of said Resolution.
IN WITNESS WHEREOF, I have hereunto set my hand and seal of said City this 5th day of
April, 2022.
Jessie Paque, Deputy City Clerk
City of Rosemount
Dakota County, Minnesota
RS125-24-788373.v2
{00302648 15} 1
RS220-402-774237.v6
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (“Agreement”) is made and entered
into as of the last date executed below (the “Effective Date”), by and between Akron 42, LLC, a
Minnesota limited liability company (“Seller”), and the City of Rosemount, Minnesota, a
Minnesota municipal corporation (“Buyer”). Seller and Buyer may be collectively referred to as
the “Parties” and, singularly, as a “Party.”
RECITALS
A. Seller is the owner of the real property legally described on the attached Exhibit A,
comprised of the portion thereof generally depicted on the attached Exhibit B as “Outlot
A” (the “Health Club Property”), and the portion thereof generally depicted on the
attached Exhibit B as “Outlots B, C, D, and E”) (the “Residual Property”).
B. Buyer desires to purchase from Seller and Seller desires to sell to Buyer, together with
and subject to all privileges, easements, and rights appurtenant to the real property and all
improvements and fixtures located thereon, the following property:
(i) The Health Club Property; and
(ii) The Residual Property.
C. Buyer intends to enter one or more agreements with Life Time Inc. or its affiliates or
subsidiaries (“Life Time”) to grant Life Time an interest in the Health Club Property
following Closing and under which Life Time would operate a health club on the Health
Club Property (the “Recreational Facility”).
Accordingly, in consideration of the foregoing, and in consideration of the mutual
covenants herein contained, which each of the Parties hereto acknowledge is adequate and
sufficient, it is hereby agreed as follows:
ARTICLE I
PURCHASE AND SALE
1.1 Recitals Incorporated. The foregoing recitals, and the definitions contained
therein are incorporated into this Agreement as if fully set forth herein.
1.2 Agreement of Purchase and Sale. Seller agrees to sell to Buyer, and Buyer
agrees to purchase from Seller, the Health Club Property and the Residual Property which, in the
aggregate, will comprise all of the property described on Exhibit A.
1.3 Purchase Price and Manner of Payment. The purchase price for the Health
Club Property and the Residual Property shall be equal to $135,000.00 per acre (the “Purchase
Price”), payable as follows:
(i) $50,000.00 in earnest money (“Earnest Money”), to be deposited by wire
transfer of immediately available funds in escrow with First American Title Insurance
Company, 121 South 8th Street, Suite 1250, Minneapolis, MN 55402 (the “Title
DocuSign Envelope ID: 33A8699A-2C56-42FA-82A7-99A22EFEFFAA
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RS220-402-774237.v6
Company”), within 3 Business Days of the Effective Date (the “Opening Date of
Escrow”), which Earnest Money is to be held by the Title Company in an escrow account
and credited or disbursed in accordance with the provisions hereof and pursuant to the
Joint Escrow Instructions attached hereto as Exhibit C;
(ii) The balance of the Purchase Price shall be paid i n full at Closing by wire
transfer of immediately available funds.
The Earnest Money is refundable to Buyer if Buyer terminates this Agreement under
Sections 3.4, 4.5, or 11.2(a), and is otherwise non-refundable.
ARTICLE 2
PROPERTY IDENTIFICATION
2.1 Platting. During the Inspection Period, Buyer shall prepare for recording at
Closing a re-plat of the property described on Exhibit A (the “Re-Plat”) and separately
identifying the Health Club Property and the Residual Property, in accordance with Buyer’s
typical processes and standards for the same. Prior to Closing, under no circumstances shall
Seller be obligated to execute and deliver the Re-Plat, and the Re-Plat shall not be recorded prior
to Closing without the prior written approval of Seller. The loc ation, area, and description of the
Health Club Property and the Residual Property as provided in the approved and recorded Re-
Plat shall be final and binding for purposes of identifying the Health Club Property and the
Residual Property under this Agreement. As between the Parties, regardless of who prepares the
Re-Plat Documentation, all drawings, documentation, and information related to the Re-Plat (the
“Re-Plat Documentation”) will be the property of Seller until Closing, when it shall become the
property of Buyer. If this Agreement is terminated for any reason, all Re-Plat Documentation
then in existence shall be delivered to Seller.
ARTICLE 3
TITLE AND SURVEY
3.1 Title Examination. Within 5 Business Days of the Opening Date of Escrow,
Seller shall order a title insurance commitment (the “Title Commitment”) for an ALTA title
policy (the “Title Policy”) issued by the Title Company and covering the Health Club Property
and the Residual Property, accompanied by copies of all recorded documents affecting the
Health Club Property and the Residual Property with proper searches for bankruptcies,
judgments, liens, and assessments. Seller shall pay the cost of the title search, any other costs
related to issuance of the initial Title Commitment, and for the preparation and recordation of
curative title documents in connection with any Title Objections (defined in Section 3.4) that
Seller elects to cure pursuant to Section 3.4. Buyer shall pay the premium for any Title Policy,
including any endorsements or additional coverage, any costs for updates to the Title
Commitment, and for the preparation and recordation of curative title documents unrelated to
Title Objections that Seller has elected to cure.
3.2 Survey. Seller shall provide Buyer a current ALTA/NSPS land survey of the
Health Club Property and the Residual Property (the “Survey”).
DocuSign Envelope ID: 33A8699A-2C56-42FA-82A7-99A22EFEFFAA
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RS220-402-774237.v6
3.3 Conveyance of Title; Permitted Exceptions. Seller shall convey and transfer
title to the Health Club Property and the Residual Property, subject only to the Permitted
Exceptions. The phrase “Permitted Exceptions” shall be defined as all matters shown on the
Title Commitment and Survey to which Buyer does not object as set forth in Section 3.4, the Re-
Plat, and any other matter specifically identified as a Permitted Exception hereunder.
3.4 Title Objections; Cure of Title Objections. Buyer shall have 30 days from
receipt of the Title Commitment and Survey (the “Objection Deadline”) to notify Seller, in
writing, of any objections as Buyer may have to anything affecting title as contained in the Title
Commitment or the Survey (the “Title Objections,” whether one or more). Any items shown on
the Survey or the Title Commitment that are not the subject of Title Objections received on or
before the Objection Deadline shall be a Permitted Exception.
If Seller does not cure Buyer’s Title Objections within 30 days following expiration of
the Objection Deadline, Buyer may elect to either: (a) waive the uncured Title Objections, accept
title subject to the Title Objections, and proceed to Closing, in which event the uncured Title
Objections shall be considered Permitted Exceptions, and in which case the Parties shall remain
obligated to perform pursuant to the terms of this Agreement, with no reduction of Purchase
Price; or (b) terminate this Agreement by written notice to Seller given on or before the date that
is 5 Business Days after expiration of such 30 day cure period. Buyer’s failure to affirmatively
make an election under the preceding sentence shall be deemed an election to waive the uncured
Title Objections and proceed to Closing under subparagraph (a). Seller has no obligation to cure
any Title Objections. Upon any termination of this Agreement pursuant to this Section, the
Earnest Money shall be refunded by the Title Company to Buyer upon written confirmation by
Buyer and Seller of the termination of this Agreement.
3.5 Northern Natural Gas Easement. The Parties acknowledge that currently the
Health Club Property and the Residual Property are encumbered by an abandoned 100 ft. wide
Gas Pipeline Easement along the northern edge of the Project, filed with the Dakota County
Recorder’s Office as Document Number 1917503 (the “Northern Natural Gas Easement”) and
that there is a pipeline and/or related materials and equipment located with in the Northern
Natural Gas Easement (the “Pipeline”). The Northern Natural Gas Easement and the existence
and location of the Pipeline shall automatically be deemed a Permitted Exception, in connection
with which a Title Objection may not be made.
ARTICLE 4
CONTINGENCIES
4.1 Right of Inspection. This Agreement is contingent upon Buyer being satisfied
with the condition of the Health Club Property and the Residual Property. Within 5 Business
Days of the Effective Date, Seller shall provide to Buyer all of the following that are in Seller’s
possession: (a) all land and engineering surveys, (b) all soil tests and environmental reports, (c)
all traffic studies, and (d) other similar materials relating to the physical and environmental
condition of the Health Club Property and the Residual Property. Beginning on the Opening Date
of Escrow, Buyer and its agents shall have until August 17, 2022 to inspect all aspects of the
Health Club Property and the Residual Property (the “Inspection Period”). During the
Inspection Period, Buyer, Life Time, and their agents and representatives shall have the right to
access the Health Club Property and the Residual Property to make all inspections,
DocuSign Envelope ID: 33A8699A-2C56-42FA-82A7-99A22EFEFFAA
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RS220-402-774237.v6
investigations, and testing as the Buyer deems necessary in connection with the transactions
contemplated by this Agreement. Buyer agrees that its on-site inspections of the Health Club
Property and the Residual Property shall be conducted with reasonable prior notice to Seller.
Buyer shall pay all costs and expenses of such inspections, investigations, and testing. Buyer
shall repair any damage caused to the Health Club Property and the Residual Property by such
inspections, investigations, and testing and restore the Health Club Property and the Residual
Property to its condition as of the Effective Date. Buyer agrees to indemnify and hold Seller
harmless from all claims, liens, costs, expenses, or damages, including reasonable attorneys’ fees
and court costs, for any third-party claims or demands and any property damages, personal
injuries, or death resulting from such activities by Buyer, Life Time, and their agents and
representatives. This obligation of Buyer shall not be construed to require Buyer to perform any
removal or remediation of any Hazardous Substances as defined in any applicable Environmental
Law (as defined in Section 6.1(g)) revealed by Buyer’s actions under this Section. These
obligations of Buyer shall survive Closing or any termination of this Agreement.
4.2 Life Time Agreements. This Agreement is also contingent upon Buyer entering
into and executing all agreements with Life Time that the Buyer deems necessary in connection
with the construction and operation of the Recreational Facility on the Health Club Property (the
“Life Time Agreements”).
4.3 Development Agreement for the Residual Property. This Agreement is also
contingent upon Buyer entering into a development agreement with the Permitted Assignee
(defined in Section 12.4) of this Agreement with terms that Buyer deems necessary in connection
with the development of the Residual Property (the “Development Agreement”).
4.4 Financing. This Agreement is also contingent upon Buyer obtaining financing
that is sufficient for the Buyer to complete the construction of the Recreational Facility on the
Health Club Property (the “Financing”).
4.5 Buyer’s Right of Termination. Buyer may terminate this Agreement by written
notice to Seller, given on or prior to expiration of the Inspection Period, if the condition of the
Health Club Property or the Residual Property (the “Inspection Contingency”) is not acceptable
to Buyer for any reason or no reason whatsoever. Buyer may terminate this Agreement by
written notice to Seller, given on or prior to September 1, 2022 (the “Approval Period”), if (a)
Buyer is unable to execute satisfactory Life Time Agreements (the “Life Time Contingency”),
(b) Buyer is unable to execute a satisfactory Development Agreement (the “Development
Agreement Contingency”), or (c) obtain financing that is sufficient for the Buyer to complete
construction of the Recreational Facility (the “Financing Contingency”). Buyer may extend the
Approval Period for up to two additional 30 day periods by giving written notice Seller prior to
the expiration of the Approval Period.
4.6 Refund of Earnest Money. Timely exercise of Buyer’s right to terminate under
Section 4.5 is Buyer’s sole remedy and recourse for non-satisfaction of any contingency set forth
in this Article 4. If Buyer terminates this Agreement under Section 4.5, as required herein, the
Earnest Money shall be promptly refunded by the Title Company to Buyer. If Buyer does not
terminate this Agreement under Section 4.5 (a) on or prior to the expiration of the Inspection
Period, then this Agreement shall no longer be subject to the Inspection Contingency, or (b) on
or prior to the expiration of the Approval Period, then this Agreement shall no longer be subject
DocuSign Envelope ID: 33A8699A-2C56-42FA-82A7-99A22EFEFFAA
{00302648 15} 5
RS220-402-774237.v6
to the Life Time Contingency, the Developer Agreement Contingency, or the Financing
Contingency, and if not timely terminated under Section 4.5 the Parties shall proceed to Closing
notwithstanding any provision of this Article 4 to the contrary, and the Earnest Money shall
become non-refundable unless stated otherwise in this Agreement.
ARTICLE 5
ADDITIONAL COVENANTS
5.1 Operations. Prior to Closing, Seller shall operate the Health Club Property and
the Residual Property so as to keep it in good condition, reasonable wear and damage by casualty
and condemnation excepted. Seller shall maintain the Health Club Property and the Residual
Property in its current condition and not perform any grading activities or construct any
improvements on the Health Club Property and the Residual Property during the term of this
Agreement.
5.2 Additional Encumbrances. Seller shall not permit any restrictions, easements,
leases, liens, and other encumbrances affecting the Health Club Property and the Residual
Property to be recorded or otherwise placed or permitted to be placed against the Health Club
Property or the Residual Property on or following the Effective Date and prior to Closing, except
as may be explicitly contemplated herein or with Buyer’s prior written consent.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES
6.1 Representations and Warranties of Seller. Seller makes the following limited
representations to Seller’s knowledge. For purposes of this Agreement, the Seller’s knowledge is
limited to the actual knowledge of Jonathan Aune, who shall not have any personal liability for
any of the following representations and warranties:
(a) Organization and Authority. Seller has the requisite power and authority to
enter into and perform this Agreement and all agreements and documents referenced
herein and to convey and transfer the Health Club Property and the Residual Property to
Buyer in accordance with this Agreement. The persons signing this Agreement and
Seller’s closing documents on behalf of Seller have the authority and authorization to do
so.
(b) Rights of Others Regarding the Health Club Property and the Residual
Property. Seller has not entered into any other contracts for the sale or lease of the Health
Club Property and the Residual Property. Seller has not granted any leases, licenses,
rights of first refusal, or options to purchase the Health Club Property or the Residual
Property or any other rights to others that prevent the consummation of this Agreement.
Seller will not enter into any contracts relating to the lease or sale of the Health Club
Property or the Residual Property with any other party unless this Agreement is
terminated pursuant to its terms.
(c) Proceedings. There is no action, litigation, governmental investigation,
condemnation, eminent domain, or other legal proceeding pending against the Health
Club Property or the Residual Property.
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(d) Compliance with Laws. Seller has received no written notice of any
violations of applicable laws, codes, ordinances, and regulations with respect to the
Health Club Property or the Residual Property.(e) No Other Persons with Rights of
Possession. There are no tenants, occupants, or other persons with a right of possession to
all or any part of the Health Club Property or the Residual Property.
(f) No Mechanic’s Liens. There has been no labor or material furnished to the
Health Club Property or the Residual Property for which payment has not been made.
(g) Hazardous Substances. Seller has not received written notice from any
public authority or private party that the Health Club Property or the Residual Property is
in violation of any applicable Environmental Law. As used herein, the term
“Environmental Law” shall mean the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. § 9601 et seq.), the
Resource Conservation and Recovery Act, as amended (42 U.S.C. § 6901 et seq.), the
Toxic Substances Control Act, as amended (15 U.S.C. § 2601 et seq.), the Clean Air Act,
as amended (42 U.S.C. § 7401 et seq.), the Federal Water Pollution Control Act, as
amended (33 U.S.C. § 1251 et seq.), the Safe Drinking Water Act, as amended (42 U.S.C.
§ 300f et seq.), and any state counterpart or equivalent of any of the foregoing.
(h) Underground Storage Tank. Seller has no knowledge of any underground
storage tank located on the Health Club Property or the Residual Property.
(i) Wells. Seller has no knowledge of a well located on the Health Club
Property or the Residual Property.
(j) Septic Systems. Seller has no knowledge of any septic systems or septic
drain fields on the Health Club Property or the Residual Property.
The provisions of this Section 6.1 shall survive Closing. The representations and
warranties contained in this Section shall be true and correct on the Effective Date and the
Closing Date. Seller shall indemnify and hold Buyer harmless from any damages sustained by
Buyer that were caused by Seller’s material breach of any of the above representations and
warranties, but only if the claim for indemnification is made within six (6) months after the
Closing Date.
Subject to Seller’s express representations, warranties and covenants in this Agreement,
Buyer is purchasing, and Seller shall sell and convey to Buyer, the Health Club Property and the
Residual Property in its existing condition on the Closing Date AS-IS, WHERE-IS, and WITH-
ALL-FAULTS, with respect to all facts, circumstance, conditions, and defects. Except for
Seller’s express representations and warranties contained in this Agreement, Seller disclaims,
and Buyer acknowledges that Seller has not made, any warranty or representation, express or
implied, written or oral, statutory or otherwise, of any nature whatsoever with respect to the
Health Club Property or the Residual Property, including without limitation representation, use
of the Health Club Property or the Residual Property for Buyer’s intended use, the condition of
the Health Club Property or the Residual Property, past or present use, development, investment
potential, tax ramifications or consequences, present or future zoning, habitability,
merchantability, fitness or suitability for any purpose, or any other matter with respect to the
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Health Club Property or the Residual Property. Except for Seller’s express representations and
warranties contained in this Agreement, all other warranties, either express or implied, of the
physical condition (including environmental condition) of the Health Club Property or the
Residual Property are void. Buyer acknowledges that it and its representatives have or before
Closing will have fully inspected the Health Club Property and the Residual Property or will be
provided with an adequate opportunity to do so, are or will be fully familiar with the financial
and physical (including without limitation environmental) condition thereof.
6.2 Representations and Warranties of Buyer. Buyer represents and warrants to
Seller as follows:
(a) Organization and Authority. Buyer has the requisite power and authority
to enter into and perform this Agreement and all agreements and documents referenced
herein and to acquire all of the Health Club Property and the Residual Property in
accordance with this Agreement. The person signing this Agreement and Buyer’s closing
documents on behalf of the Buyer is authorized to do so.
(b) Consents. As of the Closing Date, Buyer will have obtained all consents
and approvals required to consummate the transactions contemplated in this Agreement.
(c) Indemnification for Buyer’s Investigation. Buyer shall promptly pay when
due any and all charges related to its inspections, investigations, and testing of the Health
Club Property and the Residual Property.
The representations and warranties contained in this Section shall survive Closing and
shall be true and correct on the Effective Date and the Closing Date. Buyer shall indemnify and
hold Seller harmless from any damages sustained by Seller that were caused by Buyer’s material
breach of any of the above representations and warranties, but only if the claim for
indemnification is made within six (6) months from the Closing Date.
ARTICLE 7
CLOSING
7.1 Time and Place of Closing. The closing of the purchase and sale transaction
contemplated by this Agreement (“Closing”) shall occur fifteen (15) days after the expiration, or
Buyer’s waiver, of the Approval Period, or if there have been any extensions of the Approval
Period pursuant to Section 4.5 of this Agreement, the closing shall occur fifteen (15) days after
the expiration of the extension (the “Closing Date”) or such earlier date as may be agreed by the
Parties, at the offices of the Title Company. Closing may occur through deliveries by the Parties
of those documents and funds described in Sections 7.2 and 7.3 hereof into a closing escrow to
be administered by the Title Company.
7.2 Seller’s Obligations at Closing. As a condition of Buyer’s obligations to close
and purchase the Health Club Property and the Residual Property at Closing, Seller shall:
(a) Deed. Deliver to Buyer a duly executed limited warranty deed to the
Health Club Property and the Residual Property in recordable form (the “Deed”), subject
to the Permitted Exceptions, any liens, encumbrances, adverse claims or other matters
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which Buyer has created or to which Buyer is a party, and all applicable laws, ordinances,
and regulations.
(b) Authority. Deliver to Buyer such evidence as Title Company may
reasonably require as to the authority of the persons executing documents on behalf of
Seller.
(c) Seller’s Affidavit. Deliver to Buyer an affidavit duly executed by Seller
that on the Closing Date, there are no outstanding unsatisfied judgments, tax liens, or
bankruptcies against or involving Seller or the Health Club Property or the Residual
Property; that there has been no skill, labor, or material furnished to the Health Club
Property or the Residual Property at the request of Seller for which payment has not been
made; and that there are no unrecorded interests in the Health Club Property or the
Residual Property known to Seller.
(d) FIRPTA Affidavit. Deliver to Buyer an affidavit duly executed by Seller
that Seller is not a “foreign person” and containing such other information as required by
section 1445 of the Internal Revenue Code.
(e) Bring-Down Certificate. Deliver to Buyer an Affidavit duly executed by
Seller that reaffirms the truth and accuracy of Seller’s representations and warranties set
forth in this Agreement.
(f) Other Documents. Deliver to Buyer all other documents reasonably
necessary to consummate the transaction contemplated by this Agreement.
7.3 Buyer’s Obligations at Closing. As a condition to Seller’s obligations to close
and sell the Health Club Property and the Residual Property at Closing, Buyer shall:
(a) Purchase Price. Pay to Seller the Purchase Price by wire transfer of
immediately available funds.
(b) Authority. Deliver to Seller such evidence as Seller’s counsel and/or the
Title Company may reasonably require as to the authority of the persons executing
documents on behalf of Buyer.
(c) Other Documents. Deliver to Seller all other documents reasonably
necessary to consummate the transaction contemplated by this Agreement.
7.4 Closing Costs. In addition to any allocation of costs and fees set forth in other
sections of this Agreement, Seller and Buyer agree to the payment of costs in connection with
Closing this transaction as follows:
(a) Closing Fee. On the Closing Date, Seller shall pay any reasonable and
customary fee or charge imposed by the Title Company or other closing agent for Closing
this transaction, including escrow fees.
(b) Conveyance Fee. On the Closing Date, Seller shall pay the state deed tax
for the recording of the deed to be delivered by Seller under this Agreement.
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(c) Recording Fee. On the Closing Date, Buyer shall pay the cost of recording
the Deed, the Re-Plat, and all agreements and documents related to the transactions
contemplated by Sections 4.2, 4.3, and 4.4.
(d) Corrective Costs. On or before the Closing Date, Seller shall pay the cost
of recording all documents necessary to place record title in the condition warranted by
Seller in this Agreement.
(e) Attorneys’ Fees. Buyer and Seller shall pay their own attorneys’ fees for
the transaction contemplated by this Agreement, except as set forth in Section 12.13.
(f) Other Costs. Any other costs required to be paid by Buyer or Seller
pursuant to this Agreement not previously paid by Buyer or Seller prior to Closing shall
be allocated between the Parties in the customary manner for closing of commercial
properties in the Minneapolis/St. Paul metropolitan area.
ARTICLE 8
REAL ESTATE TAXES AND SPECIAL ASSESSMENTS
On or before the Closing Date, Seller shall pay all real estate taxes and installments of
special assessments for the Health Club Property and the Residual Property that are due and
payable in years prior to the year of Closing. Real estate taxes due and installments of special
assessments payable in the year of Closing, shall be prorated between Seller and Buyer as of the
Closing Date, with Buyer being responsible for all such taxes and special assessments due on and
after the Closing Date. Taxes due and payable in the year of Closing will need to be paid by
Seller and Buyer at Closing in order to record the Re-Plat. Notwithstanding the foregoing, Buyer
shall assume and pay all amounts due or coming due in connection with any improvements
contemplated or authorized in the Joint Development and Cost Sharing Agreement dated March
20, 2008 (Document No. 2581677), including any such amounts constituting levied, pending or
deferred special assessments, and whether such improvements are completed before or after
Closing.
ARTICLE 9
BROKERS
Seller and Buyer represent, warrant, and covenant to each other that they have not dealt
with or through any real estate broker, agent, salesperson, finder, or the like relevant to the
transactions contemplated under this Agreement, except for Andy Heieie of Colliers
International and Ted Gonsior of Jones Lang LaSalle Brokerage, Inc. (together “Seller’s
Broker”). Seller shall be responsible for paying any commission due to Seller’s Broker. Seller
and Buyer agree to indemnify, defend, and hold harmless each other from and against all claims,
demands, liabilities, damages, losses, costs, and expenses (including attorneys’ fees and costs)
resulting from the claim of any other party for any commissions or fees arising by reason of the
conduct of the indemnifying Party. This indemnification provision shall survive Closing or any
termination of this Agreement.
ARTICLE 10
CASUALTY AND EMINENT DOMAIN
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10.1 Casualty. Seller agrees to maintain Seller’s current insurance coverage on the
Health Club Property and the Residual Property until Closing. If the Health Club Property and
the Residual Property are materially damaged or destroyed prior to the Closing Date, Seller shall
give notice to Buyer and assign and transfer to Buyer all assignable rights or interest in and to
any insurance proceeds payable on account of such casualty upon Closing of this transaction.
10.2 Eminent Domain. If eminent domain proceedings are commenced prior to the
Closing Date against all or any part of the Health Club Property or the Residual Property, Seller
shall immediately give notice to Buyer, together with a legal description of the real property
being taken, and Buyer shall have the right, at its option, to terminate this Agreement by giving
written notice to Seller. If Buyer does not give such notice within 15 days following Seller’s
notice, then the Parties shall proceed to Closing, with no reduction in the Purchase Price, and
Seller shall assign to Buyer all of Seller’s right, title, and interest to appear in and receive any
award from such proceeding. In the event any awards are made prior to Closing, Seller shall
place such awards in escrow with the Title Company, which will release such awards to Buyer
upon Closing or to Seller upon termination of this Agreement.
ARTICLE 11
DEFAULT AND REMEDIES
11.1 Default. Buyer or Seller shall be in default under this Agreement if either fails to
observe, perform, or comply with any material term, condition, or obligation of this Agreement
and such failure continues for a period of 10 days after written notice thereof given pursuant to
Section 12.5.
11.2 Remedies. Buyer or Seller shall have the following remedies upon default:
(a) Buyer’s Remedies. Upon Seller’s default under this Agreement, Buyer
shall be entitled to one of the following remedies: (i) terminate this Agreement pursuant
to law by written notice to Seller, in which event the Earnest Money shall be returned to
Buyer; (ii) waive the default by Seller and proceed to Closing without adjustment to the
Purchase Price; or (iii) obtain the specific performance of this Agreement by Seller,
which action shall be commenced on or before six (6) months after the date of Seller’s
default.
(b) Seller’s Remedies. Upon Buyer’s default under this Agreement, Seller
shall be entitled to one of the following remedy: (i) terminate this Agreement pursuant to
law by written notice to Buyer and to retain the Earnest Money as liquidated damages; or
(ii) waive the default by Buyer and proceed to Closing without adjustment to the
Purchase Price.
The rights and remedies of this Section shall survive Closing or any termination of this
Agreement. Buyer and Seller waive all other right and remedies for breach of this Agreement.
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ARTICLE 12
MISCELLANEOUS
12.1 Successors or Assigns. This Agreement shall be binding upon and inure to the
benefit of the Parties, and their respective successors and assigns.
12.2 Severability. In the event any provision of this Agreement shall be held to be
invalid, unenforceable, or in conflict with the law of the jurisdiction, the remaining provisions of
this Agreement shall continue to be valid, enforceable, and not be affected by such holding.
12.3 Waiver. No term or condition of this Agreement will be deemed waived or
amended unless expressed in writing. The waiver of any condition or the breach of any term will
not be a waiver of any subsequent breach of the same or any other term or condition.
12.4 Assignment. Buyer may not assign Buyer’s rights under this Agreement without
the prior written consent of Seller, except as provided in the following sentence. Buyer may
make a partial assignment of its rights and obligations with regard to the Residual Property under
this Agreement to Nordland Partners, LLC (or an affiliate entity thereof) or Life Time (each, a
“Permitted Assignee”) upon satisfaction of all of the following conditions (a “Permitted
Assignment”):
(a) the Inspection Period and Approval Period have expired or have been waived by
Buyer;
(b) Buyer is not in default or breach of this Agreement;
(c) such assignee shall assume, for the benefit of Seller and in a writing provided to
Seller, all of Buyer’s rights and obligations in connection with the Residual Property under this
Agreement (the “Assumed Obligations”); and
(d) advanced written notice of such assignment is provided to Seller.
No assignment of Buyer’s rights and obligations hereunder shall relieve Buyer of any of
its obligations hereunder, unless the assignment is a Permitted Assignment and Buyer shall have
also delivered to Seller an agreement, in form reasonably acceptable to Seller, under which Life
Time Inc. or another party reasonably acceptable to Seller commits to guaranty performance of
the obligations assumed by the Permitted Assignee, including the Permitted Assignee’s
obligation to close on the acquisition of the Residual Property and pay the corresponding portion
of the Purchase Price concurrent with closing on the Health Club Property. Any assignment or
delegation in violation of this Section 12.4 shall be void and of no effect whatsoever.
12.5 Notices. Any notice required or permitted pursuant to this Agreement shall be in
writing and delivered by Fed Ex or UPS overnight delivery service with proof of delivery. All
notices shall be addressed to the Party and the Party’s counsel, as set forth below. Notices shall
be deemed given upon the date of delivery.
If to Seller:
U.S. Home Corporation
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ATTN: Jon Aune
16305 36th Ave. N., Suite 600
Plymouth, MN 55446
With copies to:
Vantage Law Group, PLLC
ATTN: Jerry Perron
125 SE Main Street, Suite 250
Minneapolis, MN 55414
If to Buyer:
City of Rosemount
ATTN: City Administrator
2875 145th Street West
Rosemount, MN 55068-4997
With copies to:
Kennedy & Graven, Chartered
ATTN: Sarah Sonsalla
Fifth Street Towers
150 South Fifth Street, Suite 700
Minneapolis, MN 55402
Notwithstanding the foregoing, any notice given pursuant to Minnesota Statutes Section
559.21 shall comply with the notice provisions required by said Section 559.21.
12.6 Third Party Beneficiaries. Except as explicitly contemplated by Section 12.4,
the provisions of this Agreement and of the documents to be executed and delivered at Closing
are for the benefit of Buyer and Seller only and are not for the benefit of any third party,
explicitly including Life Time. No third party shall have the right to enforce the provisions of
this Agreement or the documents to be executed and delivered at Closing.
12.7 Termination. If this Agreement is terminated by either Buyer or Seller pursuant
to a right of termination expressly set forth in this Agreement, neither Party shall have any
further rights or obligations under this Agreement, except for the obligation, if any, to refund the
Earnest Money, except for any rights or obligations that expressly survive such termination.
Upon Seller’s request in the event of any such termination, Buyer shall execute a quit claim deed
or other instrument that is reasonable in form to memorialize the occurrence and effect of such
termination.
12.8 Time. For purposes of this Agreement, “Business Days” are defined as Monday
through Friday, excluding any day on which the offices of federally chartered banks in
Minnesota are closed for business. Time is of the essence for the performance of this Agreement.
Should the date for the giving of any notice, the performance of any act, or the end of any period
provided for herein fall on a non-Business Day, such date shall be extended to the next Business
Day.
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12.9 Governing Law. This Agreement shall in all respects be interpreted, construed,
and enforced according to the substantive and procedural laws of the State of Minnesota.
12.10 Counterparts. This Agreement may be executed separately and independently in
any number of counterparts and each and all of which together shall be deemed to have been
executed simultaneously and regarded as one agreement dated the Effective Date. This
Agreement may be executed and delivered by facsimile or e-mail transmission and a copy of
Seller’s and/or Buyer’s signature on this Agreement shall be as binding as an original signature.
12.11 Captions. The captions and headings contained in this Agreement are for
convenient reference only and shall not affect the interpretation of this Agreement.
12.12 Construction. Seller and Buyer and their respective counsel have reviewed and
revised this Agreement. Seller and Buyer acknowledge that the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting Party shall not be employed in
the interpretation of this Agreement.
12.13 Attorneys’ Fees and Costs. In the event of litigation arising out of breach or
claimed breach of this Agreement, the prevailing Party shall be entitled to recover from the other
Party all costs and expenses incurred as a result, including attorneys’ fees and costs.
12.14 Survival. Except to the extent set forth in this Agreement, all of the terms of this
Agreement shall merge into and shall not survive and be enforceable after Closing and delivery
of the deed.
12.15 Waiver of Jury Trial. SELLER AND BUYER HEREBY WAIVE TRIAL BY
JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM (WHETHER ARISING IN
TORT OR CONTRACT) BROUGHT BY SUCH PARTY AGAINST THE OTHER ON ANY
MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS AGREEMENT.
12.16 Entire Agreement/Amendment. This Agreement constitutes the entire
agreement between the Parties with respect to the subject matter herein and fully supersedes all
prior written or oral agreements between the Parties with respect to such matters. No other
agreement, statement, or promise made by any Party and no amendment, modification, or other
change of any provision of this Agreement shall be effective unless in writing signed by the
Parties.
12.17 Further Assurances. Each of the Parties shall execute and deliver such additional
documents, instruments, conveyances, and assurances and take such further actions as may be
required to carry out the provisions of this Agreement and give effect to the transactions
contemplated hereby.
[Signature Pages Follows]
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THIS PURCHASE AND SALE AGREEMENT has been executed and delivered as of
the Effective Date.
SELLER:
Akron 42, LLC
By: U.S. Home Corporation, its Manger
By:
Name: Jonathan Aune
Its: Vice President of Land Operations
Date: _____________________________________
This is the Seller signature page to that certain Purchase and Sale Agreement between
Akron 42, LLC and City of Rosemount, MN
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THIS PURCHASE AND SALE AGREEMENT has been executed and delivered as of
the Effective Date.
BUYER:
City of Rosemount, Minnesota
By:
Bill Droste
Its: Mayor
By: ______________________________________
Erin Fasbender
Its: City Clerk
Date: _____________________________________
This is the Buyer signature page to that Purchase and Sale Agreement between Akron 42,
LLC and City of Rosemount, MN
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Exhibit A
Legal Description of the Health Club Property and Residual Property
[Outlot J and Outlot O, Prestwick Place, Dakota County, Minnesota]
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Exhibit B
Preliminary Depiction of the Health Club Property (Outlot A) and the Residual Property
(Outlots B, C, D, and E)
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Exhibit C
Joint Escrow Instructions
THESE JOINT ESCROW INSTRUCTIONS (these “Escrow Instructions”) are made and
entered into among Akron 42, LLC (“Seller”), City of Rosemount, Minnesota (“Buyer”), and First
American Title Insurance Company (“Title Company”), effective as of ____________, 2021. Seller,
Buyer, and Title Company may be referred to individually as a “Party,” and collectively as the “Parties.”
The Parties mutually agree as follows:
1. Seller and Buyer are parties to that certain Purchase and Sale Agreement dated
______________, 2021 (the “Agreement”), with respect to that certain real property identified in the
Agreement.
2. Buyer has agreed to pay earnest money (the “Earnest Money”) pursuant to Section 1.3(i)
of the Agreement.
3. Title Company hereby agrees to hold the Earnest Money in escrow until the earliest of
the Closing Date under the Agreement or the distribution of the Earnest Money in accordance with the
terms of the Agreement.
4. In the event of a dispute between any of the Parties hereto as to their respective rights and
interests hereunder, including, without limitation, the disposition of the Earnest Money, Title Company
shall be entitled to hold the Earnest Money until receipt of a jointly signed Termination Agreement by the
Parties, or until such dispute shall have been resolved pursuant to Minnesota Statutes Section 559.21.
5. Title Company will have no liability or responsibility other than to act as an escrow agent
hereunder and to hold, invest, pay, and disburse the Earnest Money pursuant to the terms of the
Agreement. Any charges for Title Company’s services will be paid by Seller.
6. Title Company’s address for notices is: First American Title Insurance Company, 121
South 8th Street, Suite 1250, Minneapolis, MN 55402, ATTN: Mike Broyles.
IN WITNESS WHEREOF, the Parties have executed this Escrow Agreement as of the date
above.
AKRON 42, LLC CITY OF ROSEMOUNT, MINNESOTA
By: U.S. Home Corporation, its Manager
By: By:
Its: Its:
FIRST AMERICAN TITLE INSURANCE COMPANY
By:
Its: ____________
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