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DRAFT Earnest Money Draft Date: July 19,2006 Page 2 of 6 5. SPECIAL ASSESSMENTS SELLER SHALL PAY on the date of closing all installments of special assessments, certified for payment with the'feal estate taxes due and payable in the year of closing. SELLER SHALL PAY ON DATE OF CLOSING all other special assessments levied as of the date of this Agreement. SELLER SHALL PROVIDE FOR PAYMENT OF special assessments pending as of the date of this Agreement for improvements that have been ordered by the City Council or any other governmental or private assessing authorities. (Seller's provision for payment shall be by payment into escrow of 1 1/2 times the estimated . amount of the assessments.) If a special assessment becomes pending after the date of this Purchase Agreement and before the date of closing, Buyer may, at Buyer's option: (a) assume payment of the pending special assessment without adjustment to the purchase price; or (b) require Seller to pay the pending special assessment (or escrow for payment of same a sum equal to 1 1/2 times the. project pending assessment) and Buyer shall pay a commensuratejncrease in the purchase price of the property, which increase shall be the saine as the estimated amount of the assessment; or (c) declare this Purchase Agreement terminated by written notice to Seller. If Buyer terminates this Agreement, Buyer and Seller shall immediately sign a cancellation of purchase agreement. Seller shall pay on date of closing any deferred real estate taxes or special assessment payments which are required as a result of the closing of this sale. ' 6. ' .PRORA TIONS All items customarily prorated and adjusted in connection with the closing of the sale of the property herein including but not limited to rents, operating expenses, interest on any debt assumed by Buyer, shall be prorated as of the date of closing. It shall be assumed that Buyer will own the property for the entire date of closing. 7. DAMAGE TO REAL PROPERTY If there is any loss to the property between the date hereof and the date of closing, for any reason, the risk of loss shall be to the Seller. If the property is destroyed or substantially damaged before the closing, this Purchase Agreement shall terminate, at Buyer's option, if Buyer gives written notice to Seller of such termination within thirty (30) days of the damage. Upon said termination, Buyer and Seller shall immediately sign a cancellation of purchase agreement 8. EXAMINATION OF TITLE Within a reasonable time after acceptance of this Purchase Agreement, Seller shall provide evidence of title to Buyer or Buyer's designated title seNice provider, which shall include proper searches covering bankruptcies, state and federal judgments and liens, and levied and pending special assessments, as follows: IF THE PROPERTY IS ABSTRACT, Seller shall provide either (a) a commitment for an owner's. policy of title insurance on a current AL T A form issued by an insurer licensed to write titl~ insuragce in . Minnesota and Seller shall pay the costs of evidence of title for such title insurance policy, and Buyer shall pay the premium for any owner's policy or lender's policy issued by the title ins~rance company, the title examination fee an~ the fee for any endorsements or other coverages requested by BUY~,r; or