SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): October 4, 1996
RESEARCH, INCORPORATED
(Exact name of Registrant as specified in its charter)
Minnesota 0-2387 41-0908058
- ---------------------------- ------------------------ -------------------
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
P.O. Box 24064
Minneapolis, Minnesota 55424
- --------------------------------------- -------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (612) 941-3300
Item 2. Acquisition or Disposition of Assets.
SALE OF ASSETS.
On October 4, 1996, the registrant and Starkey Laboratories, Inc.
("Starkey") closed a real estate transaction pursuant to the terms of that
certain Purchase Agreement dated as of June 27, 1996 between the registrant and
Starkey (the "Purchase Agreement"). The real property is located in Eden
Prairie, Minnesota, is unimproved, and is located immediately adjacent to real
property already owned by Starkey.
The purchase price paid for the real property was $1,429,542.50 and
that price was determined by examining recent sales of similar property in the
same vicinity and by reference to a prior offer for the real property by a third
party. Starkey paid the registrant $50,000 on June 27, 1996 and the remaining
balance of the purchase price on October 4, 1996.
The registrant considers the real property to be excess land that is
not required for the continuing operation of its business. The funds received by
the registrant will be used for general working capital purposes.
Item 7. Financial Statements and Exhibits.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
Not applicable.
(b) PRO FORMA FINANCIAL INFORMATION.
As described in Item 2 above, the property sold by the
registrant was unimproved real estate. The property was not a
source of revenue and was not part of an ongoing business. As
such, no pro forma financial statements are required to be
filed with this Form 8-K.
(c) EXHIBITS.
2.1 Purchase Agreement dated as of June 27, 1996 between
the registrant and Starkey Laboratories, Inc.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
RESEARCH, INCORPORATED
By /s/ Richard L. Grose
-------------------------------------
Richard L. Grose, Assistant Secretary
Dated: October 18, 1996
Exhibit 2.1
PURCHASE AGREEMENT
THIS AGREEMENT is entered into as of the 27th day of June, 1996, by and
between Research, Inc., a Minnesota corporation, (hereinafter referred to as the
"Seller") and Starkey Laboratories, Inc., a Minnesota corporation, or its
assignee under Section XX hereof (hereinafter referred to as the "Buyer"), upon
the basis of the following facts, understandings and intentions of Seller and
Buyer.
RECITALS:
1. Seller is the owner of a parcel of unimproved property (collectively
the "Property") located in the City of Eden Prairie, County of
Hennepin, State of Minnesota and consisting of approximately 12.5 acres
of land within the SE 1/4 of the N 1/2, Section 1 T116N R22W and as
depicted on Exhibit A attached hereto;
2. Exhibit A contains a plat map with the proposed boundaries of the
Property outlined in red. The legal description and actual square
footage shall be prepared and calculated by a licensed surveyor
pursuant to Section V after the Purchase Agreement is signed.
3. Buyer desires to purchase the Property in accordance with the terms and
conditions hereinafter set forth; and
4. Seller is willing to grant and extend to Buyer such purchase right.
NOW, THEREFORE, in consideration of the agreements hereinafter provided
and other good and valuable consideration, Seller agrees to sell and Buyer
agrees to purchase from Seller the Property, together with and including all
hereditaments, appurtenances, easements and right of ways thereunto belonging or
in any way appertaining and also the right, title and interest (if any) of
Seller in and to the bounding and abutting streets, alleys and highways, subject
to and upon the following terms and conditions:
SECTION I
PURCHASE PRICE
It is hereby agreed that the Purchase Price of the Property shall be
calculated on the basis of $2.50 per square foot. The exact square footage and
the legal description of the Property shall be determined by the survey to be
obtained pursuant to Section V hereof. The "Purchase Price" as determined shall
be paid by Buyer to Seller as follows:
i) $50,000.00 Earnest Money to be paid into escrow as provided
for in Section II below; and
ii) the balance, less credits properly allocable to Buyer pursuant
to this Agreement (such as Seller's share of real estate
taxes, abstracting, transfer tax, etc.), to be payable at
closing by promissory note due and payable in full on October
3, 1996 (the "Promissory Note").
SECTION II
EARNEST MONEY DEPOSIT
Concurrently with the execution of this Agreement, Buyer shall deposit
in escrow with a title company to be agreed upon by both parties (the "Escrow
Agent") the sum of $50,000.00 (the "Deposit") which shall be retained by the
Escrow Agent for the benefit of Seller and Buyer in accordance with the
provisions of this Agreement. The parties hereby agree to execute such
documentation, if any, reasonably required by the Escrow Agent in connection
with the disbursement of the Deposit and establishment of said Earnest Money
Escrow referenced above.
SECTION III
INVESTMENT AND DISBURSEMENT OF DEPOSIT
The Escrow Agent is hereby directed to invest the Deposit in a
segregated interest-bearing money market bank deposit account with an
established local bank. Any escrow fee shall be Buyer's expense.
The Deposit shall be disbursed by the Escrow Agent as follows:
a) Except as provided for in (b) below, in the event Buyer fails
to close the transaction on the Closing Date (as such may be
extended by the terms of this Agreement), the Deposit shall be
delivered to the Seller upon the termination of this
Agreement, as evidenced by either (1) a writing by both Seller
and Buyer, (2) a Cancellation of the Purchase Agreement
pursuant to Minnesota Statutes Chapter 559, or (3) an order of
the District Court for the State of Minnesota terminating this
Agreement.
b) The Deposit shall be delivered to Buyer in the event: (i)
Seller is in default in any of its obligations herein and
continues to be in default ten (10) days after notice by Buyer
to Seller of the nature and extent of such default; (ii)
Seller is in breach of any of its warranties herein and has
been notified of such breach and has failed to cure such
breach on or before the Closing Date; (iii) this Agreement
cannot be timely closed because title to the Property is not
acceptable or cannot be delivered as provided and Buyer
terminates this Agreement pursuant to Section VI; (iv) Buyer
terminates this Agreement pursuant to Section XII hereof; (v)
Buyer terminates this Agreement pursuant to Section XVI
hereof; or (vi) Buyer terminates this Agreement pursuant to
Section IV hereof; or (vii) this Purchase Agreement is deemed
terminated pursuant to Section X hereof. In the event of any
of the foregoing, it shall be a condition of delivery of the
Deposit to Buyer that Buyer provide Escrow Agent with an
executed recordable quit claim deed to the Property,
terminating Buyer's right to purchase the Property and any
interest in the Property.
c) In the event Buyer proceeds to Closing, the Deposit shall be
delivered to Seller at Closing as part payment of the Purchase
Price.
d) Upon the disbursement of the Deposit, any interest earned
thereon shall be paid to Buyer unless the Deposit is paid to
Seller pursuant to (a) above, in which case, the interest
shall be paid to Seller.
SECTION IV
BUYER'S CONDITIONS PRECEDENT
Seller agrees that this Agreement shall be conditioned upon Buyer's
satisfaction, in its sole and absolute judgment, that the following
contingencies with respect to the Property are met:
a) Not less than 85% of the square footage of the Property is
useable for the proposed use without violation of governmental
regulations regulating wetlands and without incurring
significant land preparation charges exclusive only of grading
and fill charges.
b) Buyer's inspection, testing, sampling and approval of the
Property and its soil and such other attributes as may be
deemed necessary by the Buyer in order to ascertain whether
the Property is suitable for the construction of an office
warehouse building and a parking lot (collectively, the
"Proposed Use"). This Proposed Use contingency is satisfied if
Buyer is able to construct an office/warehouse building of
75,000 square feet, together with a parking lot. Seller agrees
to allow Buyer and its agents the right of any ingress or
egress over and through the Property for the purpose of
inspecting and testing the same and making other observations
as Buyer deems reasonably necessary. Buyer agrees to indemnify
and hold Seller harmless from all injury, death or property
damage or claims of any kind whatsoever arising out of or in
any way incidental to Buyer's or Buyer's agent's presence on
the Property for the purposes aforesaid.
c) The Property is or will be properly zoned for the Proposed Use
and Buyer is able to obtain reasonable assurances that it can
obtain a building permit for the Proposed Use.
d) All utilities, including but not limited to electricity, gas,
water (fire and domestic), storm and sanitary sewer, are
available to the site, through valid and adequate public or
private easements for the proposed use; provided that in the
case of private easements, they are appurtenant to the
Property, or on the Property's side of abutting streets of
size and capacity sufficient to serve the Proposed Use.
e) That none of the encumbrances set forth on Exhibit B attached
hereto (the "Permitted Encumbrances") interfere with Buyer's
Proposed Use and that there are no land use restrictions,
environmental requirements, or other requirements established
by any entity or authority having legal jurisdiction there
over which would prohibit Buyer's Proposed Use.
f) Buyer obtaining, as provided in Section V(A) hereof, the
hazardous waste report(s) for the Property from any
environmental consultant organization selected by Buyer
showing the absence of hazardous substances, pollutants and
trash thereon and otherwise solely satisfactory to Buyer and
certified in favor of Buyer.
g) All of Seller's warranties herein contained are true and
correct as of the date of Closing.
The conditions precedent enumerated above shall be deemed not found to
exist to the reasonable satisfaction of Buyer, and this Agreement shall be
deemed terminated unless Buyer gives written notice hereunder to Seller that
Buyer affirmatively waives in writing these conditions precedent prior to the
date which is sixty (60) days after Buyer has received an original copy of this
Purchase Agreement executed by Seller and Buyer ("Contingency Date"); provided,
however, that the Contingency Date shall be extended to Closing with respect to
item f) above should the Buyer deem it necessary to have a Phase 2 environmental
audit undertaken pursuant to Section V(a) hereof. Upon termination of this
Agreement as a result of Buyer's not waiving these conditions precedent, all
parties hereto shall be released from all duties and obligations to each other
contained herein.
SECTION V
ENVIRONMENTAL AUDITS, SURVEY & REPLATTTNG SUBDIVISION
A. Environmental Audits. Buyer will obtain at Buyer's sole cost and
expense, a "Phase One" environmental audit certified to Buyer. If Buyer believes
a Phase II environmental audit is necessary, Buyer shall obtain Seller's
approval before proceeding with such environmental audit, which approval shall
not be unreasonably withheld. If Seller does refuse to approve a Phase II
environmental audit, then Buyer may elect to terminate this Agreement and both
parties hereto shall be released from all duties and obligations to each other
contained herein. Seller agrees to provide Buyer with a copy of the most recent
Phase I audit of the Property in Seller's possession, if any.
Subject to the foregoing, Buyer shall have the right to do additional
environmental audits and/or soil tests regardless of the cost as long as Buyer
pays for all of such costs. Buyer agrees to indemnify and hold Seller harmless
from all mechanic's liens liability, injury, death, property damage or other
costs and expenses arising from Buyer's doing any such environmental audits
and/or soil tests. Buyer shall provide Seller with a copy of each such written
test result or report within ten (10) days of Buyer's receipt of the same.
B. Survey. Seller shall as promptly as possible after the date hereof
and at Seller's sole expense commence the preparation of materials required for
the subdivision of the Property from Seller's Property (the "Seller's Property")
to allow for a sale of the Property to Buyer (the "Subdivision"') Seller shall
provide Buyer with a copy of all such Subdivision documents, including without
limitation the plat drawing required for the Subdivision. Seller shall also
cause a proposed survey to be made of the Property showing the proposed legal
description for the Property following the Subdivision (the "Survey"). The
Survey will be in a form to remove the survey exception from Buyer's title
insurance for the Property and will show the exact square footage of the
Property.
C. Wetland Delineation. Buyer shall as promptly as possible after the
date hereof obtain, at its expense, a Wetland Delineation of the Property
identifying the area of the Property that is unbuildable.
D. Copies of Seller's Documents. Seller shall promptly deliver to Buyer
copies of all soil tests, environmental audits, surveys and other documents
relating to the physical property of the Property which are within Seller's
control.
E. Replatting. Seller shall, at Seller's expense, replat the Property
prior to Closing. If the city does not approve the replatting and it is
impossible for Seller to perform this obligation, then this Agreement shall be
terminated and both parties shall be released from all duties and obligations to
each other contained herein.
SECTION VI
TITLE EVIDENCE
A. Seller shall, within a reasonable time following (a) Buyer's payment
of the Deposit and (b) the preparation of the Survey described in Section V (B),
and at Seller's expense, provide Buyer with a commitment(s) (the "Commitment")
for an Owner's Policy of Title Insurance (ALTA Form B-1992), for the Property
issued by Title. Buyer shall pay at Closing the cost of the actual title
insurance policy, if any, to be purchased by Buyer in the amount of the Purchase
Price. The Commitment shall: (i) bear a date subsequent to the date hereof, (ii)
include legible copies of all documents, maps, or plats set forth therein as
affecting the Property; and (iii) be issued through First American Title
Insurance Corporation in its capacity as a title insurance company by its local
office or by its local agent. The Commitment shall identify the Property and
easements appurtenant thereto by the proposed legal description(s) set forth on
the Survey. The Commitment shall, at Buyer's option and cost, contain
endorsements guaranteeing: (i) the zoning classification of the Property; and
(ii) that the Property abuts the public street(s) immediately adjacent thereto
and has direct and valid access thereto; if such commitment options are not
available for whatever reason, Buyer must elect to proceed to closing without
the commitment options or elect to terminate the Agreement, in which case both
parties hereto shall be released from all duties and obligations to each other
contained herein.
B. Within twenty (20) days after receipt of both the Commitment in the
form specified above and the Survey to be obtained by Seller pursuant to Section
V hereof, Buyer shall deliver to Seller a written statement containing any
objection Buyer has to title. If such statement is not delivered within the
twenty (20) day period, title shall be deemed approved by Buyer. If such
statement is so delivered, Seller may use reasonable efforts to cure or remove
all objections prior to Closing, provided, however, Seller shall have no
obligation to cure or remove any objections. If any objection is not cured or
removed within 120 days of the receipt by Seller of the aforesaid written
statement containing objection of Buyer to title, Buyer, at its option, may
either: (i) accept title as it is; or (ii) terminate this Agreement. Upon any
such termination all parties shall be released from all duties or obligations
contained herein and the Deposit returned to Buyer as provided for in Section
III(b) hereof. Seller shall also deliver all abstracts in its possession to the
Property to the Buyer at closing.
SECTION VII
RESTRICTIVE COVENANT
Buyer acknowledges that the construction of the Proposed Use will
impact Seller's use of the Seller's Property. Buyer further acknowledges that
but for Buyer's agreement described in this Section VII, Seller would not sell
the Property to Buyer. The parties mutually acknowledge that Buyer may not
construct the Proposed Use immediately following the Closing. Accordingly, Buyer
agrees that prior to the construction of any improvement on the Property,
including without limitation the Proposed Use, Buyer shall (a) regrade the
Property and Seller's Property, pursuant to grading plan reasonably agreeable to
Buyer and Seller and based upon the recommendations of the surveyor (the
"Regrading"). Buyer agrees that the provisions of this Section VII shall be
placed in the Deed provided by Seller at Closing (as otherwise described in
Section X(a) of this Agreement) as a Restrictive Covenant, provided that the
provision placed in the Deed shall specify the grading recommendations made by
the surveyor to the extent that the obligations of Buyer to regrade can be
identified satisfactorily to resolve potential disputes.
SECTION VIII
INTENTIONALLY DELETED
SECTION IX
WARRANTIES
Seller warrants and represents to Buyer that the following statements
are now, and will at the closing, be true and accurate:
a) Seller will have marketable and insurable record title to the
Property as of Closing, subject only to the Permitted
Encumbrances listed on Exhibit B attached hereto and made a
part hereof;
b) At Closing, Seller shall convey by warranty deed to Buyer the
Property free of all leases, conveyances or other transfers or
encumbrances on the Property or any portion thereof except for
Permitted Encumbrances and other matters approved by Buyer
pursuant to Sections IV or VI or as otherwise provided herein;
c) Seller has not received any notice of any pending action to
take by eminent domain or by deed in lieu thereof all or any
portion of the Property;
d) Seller shall be solely responsible for and shall pay on the
Date of Closing any deferred tax or assessment;
e) Seller is not a "foreign person" as contemplated by Section
1445 of the Internal Revenue Code. At the closing Seller will
deliver to Buyer a certificate so stating, in a form complying
with the Federal tax law;
f) Seller has the full right, power and authority to enter into
this Agreement and to carry out the terms and provisions
hereof including, but not limited to, compliance with all
appropriate procedures to authorize the execution and delivery
of this Agreement;
g) To the actual knowledge of Seller's officers and directors,
without any inquiry or investigation whatsoever, the Property
has not been used for storage or disposal of, nor does it
contain, any hazardous substance or high concentrations of
pollutants or contaminants, including but not limited to,
petroleum or gas products and those defined in 42 USC ss. 6903
or ss. 6921, nor has the Property been used for the dumping of
trash or other waste products. To the actual knowledge of
Seller's officers and directors, without any inquiry or
investigation whatsoever, any asbestos or other health
endangering elements or chemicals are either absent from the
Property or are properly encapsulated and do not present any
health risk;
h) To the actual knowledge of Seller's officers and directors,
without any inquiry or investigation whatsoever, no unrecorded
condition, restriction, obligation or agreement shall exist
which shall materially and adversely affect the Property or
Buyer's ability to use the Property for its proposed use;
i) To the actual knowledge of Seller's officers and directors,
without any inquiry or investigation whatsoever, no portion of
the Property is located within an area designated as "flood
plain" or "flood prone area" under any statute, regulation or
ordinance. To the actual knowledge of Seller's officers and
directors, without an inquiry or investigation whatsoever, the
Property is free from any use or occupancy restrictions,
except those imposed by zoning laws and regulations, and no
part is dedicated or has been used as a cemetery or burial
ground;
j) There exists access to the Property from a public street and,
to the actual knowledge of Seller's officers and directors,
without any inquiry or investigation whatsoever, no fact or
condition exists which would result in the termination of the
current access to the Property from any presently existing
streets and roads adjoining or situated on the Property or to
any existing sewer or other utility facilities servicing,
adjoining or situated on the Property;
k) There is no litigation at law or in equity, and no pending
proceedings of any administrative or regulatory authority
pending against the Seller or affecting the Property which
would have a material adverse effect on the Property or the
transaction contemplated by this Agreement.
For a period of twelve (12) months following closing, Seller agrees to indemnify
and hold Buyer harmless from all claims, expenses and liabilities (including
reasonable attorney's fees) incurred by Buyer as a result of Seller's breach of
any of the foregoing warranties. Any claim not made within said 12-month period
is deemed waived and Buyer may make no claim against Seller pursuant to the
warranties and representations contained in this Section IX after the expiration
of said 12-month period.
SECTION X
CLOSING
Subject to any extension as hereafter provided or agreed to in writing
by the parties, the Closing of this transaction shall take place in the office
of Seller's attorney, Lindquist & Vennum, 4200 IDS Center, Minneapolis,
Minnesota on or before September 30, 1996 (the "Closing Date") provided that
Buyer can elect to close earlier upon giving Seller a five (5) day or more prior
written notice of the exact closing date and; provided, however, that if Buyer
has not timely received all reports and information on the Property to be
obtained by or provided to Buyer pursuant to Section VI hereof, Buyer may
unilaterally agree to extend the Closing to enable such reports and information
to be so obtained or delivered.; provided, however, that if the Closing has not
occurred by September 30, 1996, then either party may unilaterally terminate
this Agreement. Possession of the Property shall be deemed to have been given by
Seller to Buyer coincident with the Closing. The following procedure shall
govern the Closing:
a) Prior to the Closing, Seller shall deliver to Buyer and the
Title Company a copy of the proposed Warranty Deed (hereafter
the "Deed") which shall be in recordable form and shall convey
good and marketable title to the Property to Buyer, subject
only to current real estate taxes, the Permitted Encumbrances
and other matters approved by Buyer. If the form of the deed
does not comply with the provision set forth above, the Seller
shall promptly correct the same upon notice from either Buyer
or Title Company.
b) On or before the Closing, Seller shall deliver to the Title
Company or Buyer the following:
i) the Deed, properly executed and acknowledged along
with a standard form Seller's Affidavit;
ii) current real estate tax statements;
iii) any applicable owner's duplicate certificates of
title and abstracts to the Property;
iv) any other documentation reasonably requested by the
Title Company in order to confirm the authority of
the Seller to consummate this transaction or to
permit the Title Company to issue to Buyer, upon
completion of the closing, its Owner's Title
Insurance Policy in an amount equal to the Purchase
Price, subject only to those matters shown on the
Commitment which were approved by Buyer (the "Title
Policy"); provided, however, that the foregoing shall
not be construed to obligate Seller to provide any
indemnity or to pay any sums not otherwise required
to be paid by Seller hereunder;
c) On or before the Closing, Buyer shall deliver to the Title
Company or Seller the following:
i) the Promissory Note, as provided in Section I(ii)
above;
ii) such additional funds as may be required of Buyer to
pay closing costs or charges properly allocable to
Buyer;
iii) any other documentation reasonably requested by the
Title Company in order to confirm the authority of
the Buyer to consummate this transaction or to permit
the Title Company to issue to Buyer, upon completion
of the closing, its Owner's Title Insurance Policy in
an amount equal to the Purchase Price, subject only
to those matters shown on the Commitment which were
approved by Buyer (the "Title Policy"); provided,
however, that the foregoing shall not be construed to
obligate Buyer to provide any indemnity or to pay any
sums not otherwise required to be paid by Buyer
hereunder;
d) After the Title Company has received all of the items to be
deposited with it, and when it is in a position to issue the
Title Policy reflected by the approved Commitment, the Title
Company shall notify Buyer and Seller and upon receipt of
written consent by both Buyer and Seller the Title Company
shall:
i) record the Deed;
ii) record any other instruments executed by the parties,
or either of them, which are contemplated by this
Agreement to be placed of record;
iii) issue to Buyer its Title Policy and deliver to Buyer
all other documents to be herein delivered by Seller
to the Title Company pursuant to this Agreement;
iv) charge Buyer for the recording cost of the Deed, the
cost of the title insurance policy and one-half of
the closing fee less abstracting charges which shall
be charged to Seller;
v) charge Seller for the survey, one-half the cost of
the closing fee, the cost of the title insurance
commitment in favor of Buyer, recording any documents
clearing title to the Property and any abstracting
costs associated with the cost of the title insurance
commitment for Buyer;
vi) charge Seller for the full cost of any deed transfer,
revenue or similar tax with respect to the sale of
the Property;
vii) real estate taxes due and payable in the year of
Closing shall be prorated for the year of closing as
of the Date of Closing. Seller shall pay all real
estate taxes due and payable in years prior to the
Date of Closing. All special assessments levied,
including interest thereon, against the Property on
the Closing Date, including, without limitation,
trunk area charges and charges for lateral benefit
from sewer and storm sewer shall be paid for by
Seller or at Seller's election such levied
assessments with the understanding that such
reduction shall be first made in the cash portion of
the Purchase Price and any excess made to reduce the
Purchase Price. If current real estate taxes are not
available, then a portion shall be made based on the
preceding year's amount, and the amount of such taxes
shall be adjusted when the current amount becomes
known. Because the current real estate tax statement
has not been allocated to the Property (and Seller's
adjacent property) and will not be so allocated until
after the Closing and the filing of the Subdivision
with the appropriate Hennepin County office, Seller
and Buyer agree that the real estate tax proration
described in this Section X(d)(vii) shall be based
upon the land value (only) portion of 1996 real
estate taxes of the Property, which will subsequently
need to be prorated on a square foot basis from the
real estate tax statement amounts;
viii) all bills for services, labor, materials, capital
improvements or other charges of any kind or nature
rendered to Seller or the Property prior to the
Closing Date shall be borne by and paid by Seller,
unless provided for in this Agreement to be paid by
Buyer;
ix) prepare closing statements for Seller and Buyer,
respectively, indicating deposits, credits and
charges (including allocation of current real
property taxes) and deliver the same, together with a
disbursement of funds, to any appropriate party.
Any supplemental closing instructions given by any party shall also be
followed by the Title Company provided the same do not conflict with any
instructions set forth herein.
SECTION XI
DEFAULT BY BUYER
In the event the transactions contemplated hereby fail to close as a
result of a default by Buyer of any of the terms of this Agreement, and such
failure to close continues for a period of ten (10) days after Seller notifies
Buyer of such event, Seller may, at its option, elect one of the following
remedies:
a) cancel and terminate this Agreement and retain the Deposit and
all interest accrued thereon; in which event neither party
shall have any further rights or obligations hereunder; or
b) enforce specific performance of Buyer's obligations hereunder;
provided that such action be commenced no later than six (6)
months from the date of default.
SECTION XII
DEFAULT BY SELLER
If Seller refuses to perform any of its obligations as set forth herein
and such failure to perform continues for a period of ten (10) days after Buyer
notifies Seller of such event, Buyer may, at its option, elect one of the
following remedies:
a) to terminate this Agreement by notice to Seller, in which
event neither party shall have any further rights or
obligations hereunder; or
b) to enforce specific performance of Seller's obligations
hereunder, including specifically the conveyance of the
Property in the condition required hereby; provided that such
action be commenced no later than six (6) months from the date
of Seller's failure to perform.
SECTION XIII
EXPENSE OF ENFORCEMENT
If either party brings an action at law or in equity to enforce or
interpret this Agreement, the prevailing party in such action shall be entitled
to recover reasonable attorney's fees and court costs in addition to any other
remedy granted.
SECTION XIV
BROKERS
Seller warrants to Buyer that in connection with this transaction
Seller has not taken any action which would result in any real estate broker's
fee being due or payable to any party. Buyer warrants to Seller that in
connection with this transaction Buyer has not taken any action which would
result in any real estate broker's fee, finder's fee or other fee being due or
payable by Seller to any other party. Seller and Buyer respectively agree to
indemnify, defend and hold harmless the other from and against any and all other
claims, fees, commission and suits of any real estate broker or agent with
respect to services claimed to have been rendered for or on behalf of such party
in connection with the execution of this Agreement or the transaction set forth
herein.
SECTION XV
NOTICE
All notices, demands and requests required or permitted to be given
under this Agreement must be in writing and shall be deemed to have been
properly given or served either by personal delivery or three (3) days after
deposit of the same in the United States Mail, addressed to Seller and Buyer, as
the case may be, prepaid and by registered or certified mail, return receipt
requested, at the following addresses:
To Seller: Research, Inc.
6425 Flying Cloud Drive
Eden Prairie, MN
Attn.: Claude Johnson, President
With a copy to: Debra K. Page
Lindquist & Vennum
4200 IDS Center
Minneapolis, MN 55402
To Buyer: Starkey Laboratories, Inc.
6700 Washington Avenue South
Eden Prairie, MN 55344
Attn.: Dale Thorstad
With a copy to: Richard T. Curtin
Curtin & Steingart, P.A.
8500 Normandale Lake Blvd., Suite 960
Minneapolis, MN 55437
Rejection or refusal to accept or the inability to deliver notice hereunder
because of changed address of which no notice was given shall be deemed to be
receipt of the notice, demand or request. Any party shall have the right from
time to time and at any time upon at least ten (10) days' written notice
thereof, to change their respective addresses, and each shall have the right to
specify as its address any other address within the United States of America.
SECTION XVI
CONDEMNATION
In the event any portion of the Property is condemned or access thereto
shall be taken, or in either case threatened, prior to the closing, and Buyer
concludes that the taking renders the land remaining unsuitable for the economic
development contemplated and Buyer notifies Seller in writing of such conclusion
within thirty (30) days after written notice to Buyer of such condemnation
action, then this Agreement shall terminate.
If the Agreement is not terminated pursuant to the preceding sentence,
the Purchase Price of the Property shall not be affected, it being agreed that
if the award is paid prior to the closing of this transaction, such amount,
insofar as it pertains to the Property, shall be held in escrow and delivered to
Buyer at the time of closing; and if the award has not been paid prior to the
closing of this transaction, then at the closing Seller shall assign to Buyer
all of its rights, title and interest with respect to such award and shall
further execute any other instrument requested by Buyer to assure that such
award is paid to Buyer.
If Buyer does not terminate this Agreement, it shall have the right to
contest the condemnation and/or the award resulting therefrom, following the
Closing. Prior to the Closing, Seller shall have the sole right to so contest.
SECTION XVII
MERGER/BINDING AGREEMENT
All previous negotiations and understandings between Seller and Buyer
or their respective agents and employees with respect to the transaction set
forth herein are merged in this Agreement which alone fully and completely
expresses the parties' rights, duties and obligations. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors, assigns, heirs and personal representatives, it being understood and
agreed that the warranties, representations and/or indemnities made and
expressed herein shall survive the closing of this transaction and shall not be
merged therein.
SECTION XVIII
EFFECTIVE DATE
The Effective Date of this Agreement shall be the date of the last
party's execution; provided, however, that if the last party does not execute
this Agreement and deliver a duly executed counterpart of the same to the first
signing party within ten (10) days of the first party's execution date, then the
offer or commitment to be bound hereby by the first executing party shall
automatically be revoked and withdrawn, whereupon either party shall
automatically be revoked and withdrawn, whereupon neither party shall be bound
hereto.
SECTION XIX
GOVERNING LAW
This Agreement shall be deemed to be a contract made under the laws of
the State of Minnesota and for all purposes shall be governed and construed in
accordance with the laws of said State.
SECTION XX
INTENTIONALLY DELETED
IN WITNESS WHEREOF, the parties hereto have executed these presents
intending to be bound by the provisions herein contained.
SELLER:
RESEARCH, INC.
By: /s/ Claude C. Johnson
----------------------------------
Its: President
Date: 6/27/96
BUYER:
STARKEY LABORATORIES, INC.
By: /s/ Dale Thorstad
----------------------------------
Its: Vice President Operations
Date: 6/27/96
EXHIBIT A
PLAT MAP
[Plat map of real estate omitted]
EXHIBIT B
PERMITTED ENCUMBRANCES
a. The lien of real estate taxes not yet due and payable in the
year of closing and thereafter.
b. Building and zoning laws, ordinances, state and federal
regulations.
c. Easements, reservations, and restrictions of record which do
not interfere with the Proposed Use.
d. A drainage easement to be entered into between Seller and
Buyer to facilitate current drainage from Seller's Property to
the Property in a form required by the City of Eden Prairie.
e. A storm sewer easement to be entered into between Seller and
the City of Eden Prairie with regard to the most westerly
portion of the Property.
f. The Restrictive Covenant described in Section VII of this
Agreement.
