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06.k Scandia Plaza SIPA - CC Packet 1 | P a g e Date of Meeting: October 21, 2025 To: Honorable Mayor and Members of the City Council From: T.J. Hofer, Consultant City Planner Kyle Morell, City Administrator Amanda Johnson, City Attorney Re: Site Improvement Performance Agreement for Scandia Plaza City staff have prepared a Site Improvement Performance Agreement (SIPA) for Scandia Plaza as required by the approvals for the project with Resolution 07-16-24-03. The SIPA has been reviewed by the owner of the property and the terms agreed. The attached SIPA is the final version and requires City Council Approval. COUNCIL ACTION The City Council can do one of the following: 1. Approve the Site Improvement Performance Agreement for Scandia Plaza 2. Table for further review and discussion RECOMMENDATION Staff recommend the City Council approve the Site Improvement Performance Agreement for Scandia Plaza. Attachments A. Site Improvement Performance Agreement for Scandia Plaza [24947-38528/3627322/2] 1 CITY OF SCANDIA SITE IMPROVEMENT PERFORMANCE AGREEMENT FOR SCANDIA PLAZA THIS PERFORMANCE AGREEMENT (“Agreement”), made and entered into on the ___ day of _______________, 2025, by and between the City of Scandia, a Minnesota municipal corporation, (“City”), and H&E Enterprises of MN, LLC, a Minnesota limited liability company (“Owner”). RECITALS: WHEREAS, the Owner obtained a Major Site Plan approval for Scandia Plaza from the City Council on July 16, 2024, pursuant to the terms in Resolution 07-16-24-03, for the Subject Property identified by PID Nos: 14.032.20.43.0008 and 14.032.20.43.0010 ( “Site Approvals”); and WHEREAS, as a condition of granting the Site Approval, the City requires Owner to enter into this Agreement regarding the landscaping and any other private exterior amenities or improvements as described in the Site Plan as approved by the City; and WHEREAS, under authority granted to it, including Minnesota Statutes Chapters 412, 429 and 462, the City has agreed to approve the Major Site Plan on the following conditions: 1. That the Owner enter into this Performance Agreement that defines the work the Owner undertakes to complete; and 2. That the Owner provides the City one or more irrevocable letters of credit, or a cash deposit, in the amount and with conditions provided below, securing the Owner’s obligation to cause the actual construction and installation of certain improvements; and WHEREAS, the Development Plans have been prepared by a registered professional engineer and the City has reviewed the Development Plans; and [24947-38528/3627322/2] 2 WHEREAS, the Owner has filed or will file a complete set of the Development Plans with the City. NOW, THEREFORE, subject to the terms and conditions of this Agreement and in reliance upon the representations, warranties and covenants of the parties herein contained, the City and Owner agree as follows: ARTICLE 1 DEFINITIONS 1.1 TERMS. The following terms, unless elsewhere defined specifically in the Agreement, shall have the following meanings as set forth below. 1.2 CITY. “City” means the City of Scandia, a Minnesota municipal corporation. 1.3 OWNER/DEVELOPER. “Owner” or “Developer” means H&E Enterprises of MN, LLC, a Minnesota limited liability company, and their successors and assigns. 1.4 SUBJECT PROPERTY. “Subject Property” or “Property” means the real property located in the City of Scandia, Washington County, identified and legally described on the attached Exhibit A. 1.5 DEVELOPMENT PLANS. “Development Plans” means all those plans, drawings, specifications and surveys identified on the attached Exhibit B. 1.6 AGREEMENT. “Agreement” means this instant contract by and between the City and Owner. 1.7 COUNCIL. “Council” means the City Council of the City of Scandia. 1.8 CITY ENGINEER. “City Engineer” means the City Engineer of the City of Scandia and their delegatees. 1.9 COUNTY. “County” means Washington County, Minnesota. 1.10 OTHER REGULATORY AGENCIES. “Other Regulatory Agencies” means and includes the following: a. State of Minnesota b. Minnesota Department of Health c. Minnesota Department of Labor and Industry d. Minnesota Department of Natural Resources e. Minnesota Department of Transportation [24947-38528/3627322/2] 3 f. Minnesota Pollution Control Agency g. Metropolitan Council h. Washington County i. Carnelian-Marine-St.Croix Watershed District j. Rice Creek Watershed District k. any other regulatory or governmental agency or entity affected by, or having jurisdiction over the Improvements. 1.11 UTILITY COMPANIES. “Utility Companies” means and includes the following: a. utility companies, including electric, gas and communications b. pipeline companies. 1.12 PRIOR EASEMENT HOLDERS. “Prior Easement Holders” means and includes all holders of any easements or other property interests which existed prior to the grant or dedication of any public easements transferred pursuant to this Agreement. 1.13 IMPROVEMENTS. “Improvements” means and includes, individually and collectively, all the improvements identified on the attached Exhibit B as amended by the conditions as listed in Article 2.1. 1.14 OWNER DEFAULT. “Owner Default” means and includes any of the following or any combination thereof: a. failure by the Owner to timely pay the City any money required to be paid under this Agreement; b. failure by the Owner to timely construct the Improvements according to the Development Plans and the City standards and specifications; c. failure by the Owner to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement; d. breach of the Owner Warranties. [24947-38528/3627322/2] 4 1.15 FORCE MAJEURE. “Force Majeure” means acts of God, including, but not limited to floods, ice storms, blizzards, tornadoes, landslides, lightning and earthquakes (but not including reasonably anticipated weather conditions for the geographic area), riots, insurrections, war or civil disorder affecting the performance of work, blockades, power or other utility failures, and fires or explosions. 1.17. FORMAL NOTICE. “FORMAL NOTICE” means notices given by one party to the other if in writing and if and when delivered both electronically AND by depositing it in the United States mail in a sealed envelope, by certified mail, return receipt requested, with postage and postal charges prepaid, addressed as follows: If to CITY: City of Scandia Attn: City Administrator 14727 209th Street N Scandia, MN 55073 For Electronic Notice: ajohnson@eckberglammers.com k.morell@ci.scandia.mn.us If to OWNER: Stev Stegner 833 8th Ave SE Forest Lake, MN 55025 or to such other address as the party addressed shall have previously designated by notice given in accordance with this Section. Notices shall be deemed to have been duly given on the date of service electronically to the party to whom notice is to be given, or on the third day after mailing if mailed as provided above. ARTICLE 2 APPROVAL OF DEVELOPMENT PLANS 2.1. APPROVAL OF DEVELOPMENT PLANS. Subject to the terms and conditions of this Agreement, the recitals above, and all other applicable City Code provisions, the City hereby approves the Development Plans. The Development Plans also include compliance by the Owner with the conditions set forth in the following: a. City Engineer’s review memo dated June 28, 2024; and b. Resolution 07-16-24-03. (collectively, the “City Staff Recommendations”). [24947-38528/3627322/2] 5 2.2 APPROVALS BY OTHER REGULATORY AGENCIES. The Owner shall obtain all necessary approvals, permits, easements and licenses from the City, the Other Regulatory Agencies, the Utility Companies, other property owners and the Prior Easement Holders as needed. Any design changes of any such entities shall be approved by the City and incorporated into the Development Plans. All due diligence, analysis and costs incurred to obtain the approvals, permits and licenses, and also all fines or penalties levied by any agency due to the failure of the Owner to obtain or comply with conditions of such approvals, permits and licenses, shall be paid by the Owner. The Owner shall defend and hold the City harmless from any action initiated by the Other Regulatory Agencies, the Utility Companies, other property owners and the Prior Easement Holders resulting from such failures of the Owner. 2.3 RECORDING. This Agreement shall be recorded with the Washington County Recorder/Registrar within thirty days of execution. ARTICLE 3 IMPROVEMENTS 3.1 IMPROVEMENTS. The Owner shall install, at its own cost, the Improvements in accord with the Development Plans and in accordance with the approvals of the City Council, and all City ordinances. The Improvements shall be completed within twelve months of execution of this Agreement except as completion dates are extended with written approval from the City Administrator or their designee. Owner shall own operate and maintain all Improvements, at no point shall the Improvements become the responsibility of the City. 3.2 GROUND MATERIAL. The Owner shall insure that adequate and suitable ground material shall exist in the areas of Improvements and shall guarantee the removal, replacement or repair of substandard or unstable material. The cost of removal, replacement or repair is the responsibility of the Owner. 3.3 GRADING/DRAINAGE PLAN. The Owner shall construct drainage facilities in accord with the Development Plans. The grading and drainage plan shall conform with the overall City storm sewer plan. The grading of the site shall be completed in conformance with the Development Plans. Owner shall provide any required deeds and/or easement agreements for conveyance, in a form acceptable to the City attorney, to City before City shall issue any building or grading permits, however construction, maintenance and ownership of all grading and drainage improvements shall be the sole responsibility of the Owner. 3.4 AREA RESTORATION. The Owner shall restore all areas disturbed by the development grading operation in accordance with the approved grading and erosion control plans. Upon request of the City Engineer, the Owner shall remove the silt fences after grading and construction have occurred. 3.5 STREET MAINTENANCE, ACCESS AND REPAIR. The Owner shall clear, on a daily basis, any soil, earth or debris from the streets and wetlands within, adjacent or near the Property resulting from the grading or building on the Property, or associated trucking operations and shall restore to the City’s specifications and repair to the City’s specifications any damage to [24947-38528/3627322/2] 6 bituminous street surfacing resulting from the use of construction equipment. Furthermore, the Owner shall maintain reasonable access to any occupied buildings within the Property, including necessary street maintenance such as grading, graveling or patching. If Owner fails to perform any of the responsibilities listed above, the City shall provide Owner with written notice. If work is not completed to City’s satisfaction within 24 hours from the notice, excluding repair or restoration work that the City has granted extra time, the City will have appropriate equipment dispatched to the Property and the City will bill all costs associated with the work to the Owner. In the event the Owner fails to timely pay costs related to the City work, the City shall withdraw the funds from any cash escrow or LOC. 3.6 LANDSCAPING. Site landscaping shall comply with City-approved landscaping plan dated 07/17/25 and City required warranties. 3.7 EROSION CONTROL. The Owner shall provide and follow a plan for erosion control and pond maintenance in accord with the Best Management Practices (BMP) as delineated by Other Regulatory Agencies. Such plan shall be detailed on the Development Plans and shall be subject to approval of the City Engineer. The Owner shall install and maintain such erosion control measures and structures as appear necessary under the Development Plans or become necessary subsequent thereto. The Owner shall be responsible for all damage caused as the result of grading and excavation resulting from the Improvements including, but not limited to, restoration of existing control structures and clean-up of public right-of-way, until the Improvements are completed. As a portion of the erosion control plan, the Owner shall re-seed, install landscaping or sod any disturbed areas in accordance with the Development Plans. The parties recognize that time is of the essence in controlling erosion. If the Owner does not provide erosion control, the City shall provide Owner with notice to complete work. If the Owner or Contractor do not complete the work to City’s satisfaction within 24 hours from the notice, the City will have appropriate equipment dispatched to the Property and the City will bill all costs associated with the clean-up effort to the Owner. In addition to billing the Owner for any clean-up work, the City also may issue a stop work order. In the event the Owner fails to timely pay costs related to City work, the City shall withdraw the funds from any cash escrow or LOC. 3.8 RESERVED. 3.9 INSPECTIONS. The City Engineer, Public Works Director or their designee shall periodically inspect the following work installed by the Owner, its contractors, subcontractors or agents; a. Improvements as detailed in Exhibit B; and b. General Property inspections in relation to a Letter of Credit reduction request or Project closeout. ARTICLE 4 RESPONSIBILITY FOR COSTS, CHARGES AND FEES [24947-38528/3627322/2] 7 4.1 IMPROVEMENT COSTS. The Owner shall pay for the Improvements; that is, all costs of persons doing work or furnishing skills, tools, machinery or materials, or insurance premiums or equipment or supplies and all just claims for the same; and the City shall be under no obligation to pay the contractor or any subcontractor any sum whatsoever on account thereof, whether or not the City shall have approved the contract or subcontract. 4.3 IMPROVEMENT FINANCIAL SECURITY REQUIREMENT. Contemporaneously herewith, the Owner shall deposit with the City an irrevocable letter of credit (“LOC”) for the amount of $110,000.00 as described in Exhibit C. The bank and form of the LOC shall be subject to approval by the City Finance Director and City Attorney and shall continue to be in full force and effect until released by the City. The LOC must be for at least a two-year term and must be automatically renewable for successive one-year periods from the present or any future expiration dates with a final expiration date of termination of the two- year warranty period described in Article 6, and further provided that the LOC states that at least 60 days prior to the expiration date, the bank will notify the City if the bank elects not to renew for an additional period. The LOC shall secure compliance by the Owner with the terms of this Agreement. The City may draw down on the irrevocable letter of credit or cash deposit, without any further notice than that provided in Article 8 relating to a Owner Default, for any of the following reasons: a) a Owner Default; or b) upon the City receiving notice that the irrevocable letter of credit will be allowed to lapse before the two-year warranty period has expired pursuant to Article 6; or c) failure to pay the City for any of the costs and expenses referenced in Article 4 or 5. The City may use these escrow proceeds to reimburse the City for its costs to take whatever action is necessary to stabilize the Property for any of the reasons stated above. After the City Engineer determines that Improvements have been constructed and after retaining 10% of amounts allocated in Exhibit C for the Improvements, the remaining proceeds shall be distributed to Owner. Owner may request the City reduce the irrevocable letter of credit or cash deposit from time to time as financial obligations are paid. The City Engineer shall inspect the Project and make the reduction request to the City Council who shall have full discretion in determining the reduction amount, if any. If the City determines the Owner or Contractor did not strictly adhere to the approved Development Plans or that work was done without required City inspection, the City may require, as a condition of acceptance, the Owner post an irrevocable letter of credit, or cash deposit equal to 125% of the estimated amount necessary to correct the deficiency or to protect against deficiencies arising therefrom. The additional irrevocable letter of credit, or cash deposit, shall remain in force for such time as the City deems necessary, not to exceed five years. In the event that work, which is [24947-38528/3627322/2] 8 concealed, was done without permitting City inspection, then the City may, in the alternative, require the Owner or Contractor expose the concealed condition or work for inspection purposes. 4.4 CASH ESCROW REQUIREMENT. The Owner shall reimburse the City for all inspection costs relating to the Improvements and all engineering, administrative, legal and other expenses incurred or to be incurred by the City in connection with this Agreement. The Owner shall deposit with the City a cash deposit for the amount of $10,000 as described in Exhibit C to cover City expenses related to the project including but not limited to planning, engineering, legal and administrative services, soil testing and inspection services. The cash escrow must be deposited with the City prior to the City executing this Agreement. The City shall use the cash deposit proceeds to reimburse the City for its costs and shall provide Owner with written itemization of said reimbursements. Upon completion of the project, the City will return the remaining proceeds to the Owner. 4.5 ENFORCEMENT COSTS. The Owner shall pay the City for costs incurred in the enforcement of this Agreement, including engineering and attorneys’ fees. 4.6 TIME OF PAYMENT. The Owner shall pay all bills from the City within thirty (30) days after billing. Bills not paid within thirty (30) days shall bear interest at the rate of 8% per year. ARTICLE 5 ADDITIONAL DEVELOPMENT REQUIREMENTS 5.1 MISCELLANEOUS REQUIREMENTS. Additional requirements for approval of the Development Plans as specified by the City Council include the following: a. Before the City issues any permits for the Property, the Owner must satisfy all of the following conditions: (1) Owner must execute this Agreement. (2) Owner must provide the City with the letter of credit for the amount stated on Exhibit C of this Agreement pursuant to the terms of Article 4 of this Improvement Agreement. (4) Owner must fully pay the City for all planning, engineering review and legal fees that have been incurred up to the date of this Improvement Agreement. b. Owner shall hold a pre-construction meeting with the City and any necessary Other Regulatory Agencies before starting any construction, demolition or grading activities on the Property. c. Owner is solely responsible for any necessary easements or approvals from adjacent property owners for construction of the Improvements. Owner will provide evidence of such easements and/or approvals upon request of the City. [24947-38528/3627322/2] 9 ARTICLE 6 WARRANTIES 6.1 OWNER WARRANTIES. “Owner Warranties” means that the Owner hereby warrants and represents the following: a. AUTHORITY. Owner has the right, power, legal capacity and authority to enter into and perform its obligations under this Agreement; no approvals or consents of any persons are necessary in connection with the authority of Owner to enter into and perform its obligations under this Agreement, other than approvals or consents that are required to be obtained herein, pursuant to Article 2. b. FULL DISCLOSURE. None of the representatives and warranties made by Owner or made in any exhibit hereto or memorandum or writing furnished or to be furnished by Owner or on its behalf contains or will contain any untrue statement of material fact or omit any material fact the omission of which would be misleading. c. PLAN COMPLIANCE. The Development Plans comply with all City, County, metropolitan, state and federal laws and regulations, including but not limited to subdivision ordinances, zoning ordinances and environmental regulations. d. WARRANTY ON PROPER WORK AND MATERIALS. The Owner warrants all work required to be performed by it under this Agreement against defective material and faulty workmanship for a period of two years after its completion. During the warranty period the Owner shall be solely responsible for all costs of performing repair work required by the City within thirty days of notification. Any trees, grass, and sod shall be warranted to be alive, of good quality, and disease free for two years after planting. Any replacement landscape materials shall be similarly warranted for one year from the time of planting. In addition, the warranty period for Improvements shall be for two years after completion; the warranty for the Improvements also shall include the obligation of the Owner to repair and correct and damage to or deficiency with respect to such Improvements. e. FEE TITLE. The Owner owns fee title to the Subject Property. 6.2 CITY WARRANTIES. “City Warranties” means the City hereby warrants and represents as follows: a. ORGANIZATION. City is a municipal corporation duly incorporated and validly existing in good standing under the laws of the State of Minnesota. b. AUTHORITY. City has the right, power, legal capacity and authority to enter into and perform its obligations under this Agreement. [24947-38528/3627322/2] 10 ARTICLE 7 INDEMNIFICATION OF CITY 7.1 INDEMNIFICATION OF CITY. Owner shall indemnify, defend and hold the City, its Council, agents, employees, attorneys and representatives harmless against and in respect of any and all claims, demands, actions, suits, proceedings, losses, costs, expenses, obligations, liabilities, damages, recoveries, and deficiencies, including interest, penalties and attorneys’ fees, that the City incurs of suffers that arise out of, result from or relate to: a) breach by the Owner of the Owner Warranties; b) failure of the Owner to timely construct the Improvements according to the Development Plans and the City ordinances, standards and specifications; c) failure by the Owner to observe or perform any covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement; d) failure by the Owner to pay contractors, subcontractors, laborers, or materialmen; e) failure by the Owner to pay for materials; f) failure to pay the City for any costs and expenses referenced in Article 4 and 5; g) approval by the City of the Development Plans; h) failure by the Owner to obtain the necessary permits and authorizations to construct the Improvements; i) construction of the Improvements; j) delays in construction of the Improvements; k) all costs and liabilities arising because the City issued building permits before the completion and acceptance of the Improvements. ARTICLE 8 CITY REMEDIES UPON OWNER DEFAULT 8.1 CITY REMEDIES. If Owner Default occurs, that is not caused by Force Majeure, the City shall give the Owner Formal Notice of the Owner Default and the Owner shall have ten [24947-38528/3627322/2] 11 business days to cure the Owner Default. If the Owner, after Formal Notice to it by the City, does not cure the Owner Default within ten business days, then the City may avail itself of any remedy afforded by law and any of the following remedies: a) The City may specifically enforce this Agreement; b) The City may collect on the irrevocable letter of credit or cash deposit pursuant to Article 4; c) The City may, at its sole option, perform the work or improvements to be performed by the Owner, in which case the Owner shall within thirty days after written billing by the City reimburse the City for any costs and expenses incurred by the City; d) The City may suspend or deny building permits for buildings within the Subject Property; e) The City may suspend any work, improvement or obligation to be performed by the City; and/or f) The City may, at its sole option, certify against the Subject Property, pursuant to Minn. Stat. § 444.075. subd. 3e, any unpaid charges, and the Washington County Auditory/Property Tax Assessor shall collect said unpaid charges in the year following said certification as the other Property taxes are collected. 8.2 NO ADDITIONAL WAIVER IMPLIED BY ONE WAIVER. In the event the Owner breaches any provision or agreement contained in this Agreement and thereafter is waived in writing by the City, such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. All waivers by the City must be in writing. 8.3 NO REMEDY EXCLUSIVE. No remedy herein conferred upon or reserved to the City shall be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under the Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. In order to entitle the City to exercise any remedy reserved to it, it shall not be necessary to give notice, other than the Formal Notice. 8.4 EMERGENCY. Notwithstanding the requirement contained in this Article hereof relating to Formal Notice to the Owner in case of a Owner Default and notwithstanding the requirement contained in this Article hereof relating to giving the Owner a ten business day period to cure the Owner Default, in the event of an emergency as determined by the City Engineer or [24947-38528/3627322/2] 12 other City staff, resulting from the Owner Default, the City may perform the work or improvement to be performed by the Owner without giving any notice or Formal Notice to the Owner and without giving the Owner the ten day period to cure the Owner Default. In such case, the Owner shall within thirty days after written billing by the City reimburse the City for any and all costs incurred by the City. The parties designate the individuals below as their contact in the event of an emergency: CITY: Charles Fischer Public Works Director, City of Scandia 651-325-5218 OWNER/OWNER: Stev Stegner 651-503-1337 Owner shall provide City with contact information for Project Manager who will be available 24 hours a day 7 days a week until the project is completed. In the event the Project Manager changes during the development, Owner shall provide the City with updated contact information. ARTICLE 9 MISCELLANEOUS 9.1 CITY’S DUTIES. The terms of this Agreement shall not be considered an affirmative duty upon the City to complete any Improvements. 9.2 NO THIRD-PARTY RECOURSE. Third parties shall have no recourse against the City under this Agreement. 9.3 VALIDITY. If any portion, section, subsection, sentence, clause, paragraph or phrase of this Agreement is for any reason held to be invalid, such decision shall not affect the validity of the remaining portion of this Agreement. 9.4 BINDING AGREEMENT. The parties mutually recognize and agree that all terms and conditions of this recordable Improvement Agreement shall run with the Subject Property, and shall be binding upon the successors and assigns of the Owner. This Improvement Agreement shall also run with and be binding upon any after acquired interest of the Owner in the Subject Property. 9.5 ASSIGNMENT. The Owner may not assign this Improvement Agreement without the written permission of the City which consent shall not be unreasonably withheld, conditioned or delayed. The Owner’s obligations hereunder shall continue in full force and effect, even if the Owner sells the Subject Property. 9.6 AMENDMENT AND WAIVER. The parties hereto may by mutual written agreement amend this Agreement in any respect. Any party hereto may extend the time for the performance of any of the obligations of another, waive any inaccuracies in representations by [24947-38528/3627322/2] 13 another contained in this Agreement or in any document delivered pursuant hereto which inaccuracies would otherwise constitute a breach of this Agreement, waive compliance by another with any of the covenants contained in this Agreement, waive performance of any obligations by the other or waive the fulfillment of any condition that is precedent to the performance by the party so waiving of any of its obligations under this Agreement. Any agreement on the part of any party for any such amendment, extension or waiver must be in writing. No waiver of any of the provisions of this Agreement shall be deemed, or shall constitute, a waiver of any other provisions, whether or not similar, nor shall any waiver constitute a continuing waiver. 9.7 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota. 9.8 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original but all of which shall constitute one and the same instrument. 9.9 HEADINGS. The subject headings of the paragraphs and subparagraphs of this Agreement are included for purposes of convenience only, and shall not affect the construction of interpretation of any of its provisions. 9.10 INCONSISTENCY. If the Development Plans are inconsistent with the words of this Agreement or if the obligation imposed hereunder upon the Owner are inconsistent, then that provision or term which imposes a greater and more demanding obligation on the Owner shall prevail. 9.11 ACCESS. The Owner hereby grants to the City, its agents, employees, officers, and contractors a license to enter the Property to perform all work and inspections deemed appropriate by the City during the installation of Improvements. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year set forth above. [The remainder of this page has been intentionally left blank.] [24947-38528/3627322/2] 14 IN WITNESS WHEREOF, the parties have executed this Performance Agreement. H&E Enterprises of MN, LLC A Minnesota limited liability Company By: _____________________ Stephen G. Stegner Its: Manager STATE OF MINNESOTA ) ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this ____ day of __________________, 2025 by Stephen G. Stegner, the Manager of H&E Enterprises of MN, LLC, a Minnesota limited liability company, on behalf of said entity. Notary Public [24947-38528/3627322/2] 15 CITY OF SCANDIA By: _____________________________ Steve Kronmiller Its: Mayor Attest: _____________________________ Brenda Ecklund Its: City Clerk STATE OF MINNESOTA ) ) ss. COUNTY OF WASHINGTON ) The foregoing instrument was acknowledged before me this ____ day of ____________, 2025 by Steve Kronmiller and Brenda Eklund, the Mayor and City Clerk respectively, of the City of Scandia, a Minnesota municipal corporation, on behalf of the City of Scandia. _____________________________________ Notary Public THIS INSTRUMENT DRAFTED BY: AFTER RECORDING PLEASE RETURN TO: Amanda Johnson # 0400128 City of Scandia Eckberg Lammers 14727 209th Street N 1809 Northwestern Ave Scandia, MN 55073 Stillwater, MN 55082 [24947-38528/3627322/2] 16 EXHIBIT A LEGAL DESCRIPTION Lot 1, Block 1, HAWKINSON BUSINESS PLAT Lot 3, Block 1, HAWKINSON BUSINESS PLAT Washington County, Minnesota PIDS: 14.032.20.43.0008 & 14.032.20.43.0010 Address: 21190 Ozark Avenue North, Scandia [24947-38528/3627322/2] 17 EXHIBIT B DEVELOPMENT PLANS AND IMPROVEMENTS The site shall be developed in substantial conformance with the following plans and review comments as approved by the City that are on file with the Community Development Department. [24947-38528/3627322/2] 18 EXHIBIT C LETTER OF CREDIT AND ADDITIONAL COSTS AND ESCROWS Required Cash Escrow - $10,000 (To be collected upon Performance Agreement Execution) Required Letter of Credit - $ 110,000 (To be Collected upon Performance Agreement Execution)