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Exhibit 10.26

PURCHASE AGREEMENT

THIS AGREEMENT ("Agreement") is made as of November 27, 2012 (the "Effective
Date"), between
 
Winland Electronics, Inc. ("Seller"),

and
 
Nortech Systems, Inc. ("Purchaser").

RECITALS

Seller desires to sell to Purchaser and Purchaser desires to purchase from
Seller, upon the terms and conditions hereinafter set forth, all of that certain
land at 1950 Excel Drive, Blue Earth County, Minnesota, together with the
building and any and all improvements thereon, and Seller's interest in
fixtures, equipment, fittings, partitions, doors, shelving, plants, shrubbery,
landscaping, all plumbing, electric, and lighting fixtures in which Seller has
any interest, now affixed to, located upon or used in any way in connection with
the use, enjoyment, occupancy or operation of the property legally described in
Exhibit A attached hereto, together with all appurtenances thereunto belonging
or appertaining, and all right, title and interest which Seller may have in all
easements, rights-of-way, roads, streets and ways bounding said property.  Said
property shall be hereinafter referred to as the "Property" or "Real Property,"
and the building and its contents and components shall be referred to as the
"Building."

NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the parties agree as follows:

1.          Sale of Property.  Seller agrees to sell to Purchaser and Purchaser
agrees to buy from Seller the Property.  Purchaser hereby acknowledges that
Seller is agreeing to the terms sets forth in this Agreement in part because of
the mutual relationship between the parties and the desire to maintain and grow
such mutual relationship.

2.          Purchase Price and Manner of Payment.  The purchase price (the
"Purchase Price") to be paid by Purchaser to Seller for the Property shall be
Two Million Six Hundred Fifty Thousand Dollars ($2,650,000.00) and shall be
payable in immediate available funds at Closing.

3.          Closing.

(a)
The consummation of the purchase and sale of the Property ("Closing") shall take
place on December 27, 2012, or such other date as is agreed upon by the parties,
at the office of the Seller in Mankato, Minnesota, or at a title company of
Purchaser’s choice in Mankato, Minnesota.

 
 
 

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(b)
At Closing the required cash shall be paid and all documents necessary for the
consummation of this transaction shall be executed and delivered to the parties
entitled thereto.  At Closing, the Title Company shall disburse the proceeds of
sale to Seller and Seller shall deliver possession of the Property to Purchaser
free of all tenancies and occupancies, except as contemplated by this Agreement;
and

(c)
At Closing, Seller shall cause to be delivered to Purchaser the following
documents:

 
(1)
Warranty Deed.  A warranty deed in recordable form, properly executed by Seller,
conveying to Purchaser the Property in fee simple, subject only to the Permitted
Exceptions, as defined in section 5(a)(2);

 
(2)
Seller's Affidavit.  An affidavit of title by Seller(s), indicating that on the
Closing Date there are no outstanding, unsatisfied judgments, tax liens or
bank­ruptcies against or involving Seller or the Real Property; that there has
been no skill, labor or material furnished to the Property for which payment has
not been made or for which mechanics' liens could be filed; and that there are
no other unrecorded interests in the Property;

 
(3)
FIRPTA Affidavit.  A non-foreign affidavit, properly executed and in recordable
form, containing such information as is required by IRS §1445(b)(d) and its
regulations;

 
(4)
IRS Reporting Form.  The appropriate federal income tax reporting form, if any
is required;

 
(5)
Title Policy.  A title policy, or a suitably marked-up commitment for title
insurance initialed by the Title Company, in the form required by this
Agreement;

 
(6)
Bill of Sale.  A Bill of Sale to all personal property included in this sale;
and

 
(7)
Other Documents.  All other documents reasonably necessary to transfer the
Property to Purchaser free and clear of all encumbrances except Permitted
Exceptions, consistent with the terms of this Agreement.

4.
Conditions to Closing.

(a)
The thirty-day period after delivery of a fully executed copy of this Agreement
to both parties shall be the "Due Diligence Period."  In addition to all other
conditions to the completion of the transaction described in this Agreement,
Seller and Purchaser agree that the Closing of this sale and purchase is subject
to satisfaction, approval or waiver by Purchaser, in its sole discretion, of the
conditions set forth below on or before the end of the Due Diligence Period:

 
 
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(1)
Inspection and approval of the physical condition and potential use of the
Property, including Purchaser obtaining all licenses required for its intended
use, at Purchaser's sole cost, including without limitation, the availability of
access, utility services, zoning, environmental matters, engineering and soil
conditions.  Purchaser shall have the right, at its expense, to conduct a Phase
1 Environmental Site Assessment of the Property.  For the purpose of conducting
physical inspections, Seller agrees to provide Purchaser and its authorized
agents, reasonable access to the Property at all reasonable times during the Due
Diligence Period.  In the event of termination of this Agreement, Purchaser
shall repair and restore any damage to the Property caused by Purchaser's
testing and return the Property to substantially the same condition as existed
prior to such entry;

 
(2)
Inspection and approval of, and to the extent now available, copies of tax
bills,  warranties, as-built plans and specifications, soil and environmental
reports,  insurance policies  and a list of personal property; and

 
(3) 
Purchaser shall have obtained financing approval from a financing institution of
its choice.

 
(4)
Purchaser and Seller shall have negotiated a Lease whereby effective at Closing
Seller shall lease, on a month-to-month basis, the current portion of the
Building that Seller currently occupies at a rate of $842.75 per month.

(b)
If any of the conditions set forth above are not satisfied or waived by
Purchaser, and/or Purchaser does not approve where such approval constitutes
such a condition, Purchaser may notify Seller, in writing, of the termi­nation
of this Agreement ("Purchaser's Termi­nation Notice") prior to the end of the
final day of the Due Diligence Period.  Upon receipt of Purchaser's Termination
Notice, Purchaser shall be released and discharged from all further obligations
under this Agreement and neither Seller nor Purchaser shall be subject to any
claim by the other for damages of any kind.  If no Purchaser's Termination
Notice has been served upon Seller within the time provided in this section 4,
all conditions shall be deemed to have been satisfied or waived and Purchaser's
obligations to close shall be firm with respect to the conditions of this
section 4;

(c)
Between the Effective Date and the Closing Date, Seller shall maintain the
Property in the same condition as presently exists, reasonable wear and tear
excepted, including the maintenance of adequate liability insurance and
insurance against loss by fire, windstorm and other hazards, casualties and
contingen­cies, including vandalism and malicious mischief; and

5.           Evidence of Title.  As evidence of Seller's title, Seller shall
deliver to Purchaser:
 
 
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(a)
Title Commitment.  As soon as practicable after the Effective Date, at Seller's
expense, a title commitment that Purchaser agrees is satisfactory for an ALTA
Form B owner's policy of title insurance ("Commitment") issued by the North
American Title Company (the "Title Company"), in the amount of the Purchase
Price showing marketable title in Seller.  Title Company shall supply Purchaser
with an endorsement updating the effective date of the commitment and disclosing
any new matters of record within forty-eight (48) hours of the Effective
Date.  If the Commitment discloses exceptions to such title, Purchaser, within
ten (10) business days following the date on which Purchaser receives the
Commitment, shall deliver to Seller written notice of Purchaser's objections, if
any, to such exceptions.  If Purchaser fails to deliver such written notice of
objections to Seller within such ten (10) day period, Purchaser shall be deemed
to have waived its right to object to such exceptions.  If  Purchaser shall so
object to any such exceptions, Seller and the Title Company shall notify
Purchaser within twenty (20) business days following the date of Purchaser's
notice of such objections that either (i) the exceptions have been, or will be
at or prior to Closing, removed from the Commitment or are or will be insured
over by the Title Company pursuant to an endorsement to the Commitment, or (ii)
Seller has failed to arrange to have the exceptions removed or insured over by
the Title Company.  Seller will, if title is found unmarketable, use diligent
efforts to correct defect(s) in title within the time provided therefore, but is
not obligated to bring any suits to correct title.  If Seller does not notify
Purchaser that it has arranged to have the exceptions removed or insured over
within said twenty (20) day period, Purchaser may elect either:

 
(1)
to terminate this Agreement; or

 
(2)
to take title as it then is, as shown on the Commitment, subject to such
exceptions (the "Permitted Exceptions").

 
Notice of such election must be made within ten (10) business days following
expiration of said twenty (20) day period.

 
If Purchaser does not give such notice of its election to so terminate this
Agreement, this Agreement shall remain in full force and effect.

 
On the Closing Date, the Title Company shall issue an owner's title insurance
policy at  Purchaser's option and cost insuring fee simple title in Purchaser as
of the Closing Date, in accordance with the Commitment, subject only to the
Permitted Exceptions.

(b)
Evidence of Title and Other Materials.  At the time of delivery of this
Agreement to Purchaser, fully executed by Seller, Seller agrees to deliver to
Purchaser copies of all title information in possession of or available to
Seller, including but not limited to, title insurance policies, abstracts of
title, attorney's opinions on title, surveys, restrictive covenants, deeds,
notes and deeds of trust and easements relating to the Property.  Seller does
not have an abstract of title, attorney’s opinion, survey, or any other
documents related to the Property and shall be under no obligation to deliver
any of said items to Purchaser.

 
 
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6.            Seller's Representations and Warranties.  Seller represents and
warrants that as of the date hereof:

(a)
Seller has received no notice from any governmental authority of any pending or
threatened (i) zoning, building, fire or health code viola­tions or violations
of other governmental requirements or regulations with respect to the Property
that have not previously been corrected, or (ii) condemnation of the Property or
that the Property does not violate any provision of any applicable zoning,
subdivision, building code, fire regulations, or other governmental codes,
ordinances or regulations.  Seller further warrants and represents that in the
event it receives any such notice prior to the Closing Date, it will provide to
Purchaser copies of any such notice.  Seller agrees to use reasonable efforts to
correct any matters disclosed in such notice.  If any such matter cannot be
corrected by Seller by Closing, Seller shall give Purchaser a credit at Closing
for the amount estimated to be required to correct such matter;

(b)
There are or will be at Closing no leases or other agreements for occupancy in
effect with respect to the Property except those which Purchaser approves in
writing during the Due Diligence Period;

(c)
Seller knows of no wells on the Property;

(d)
Environmental Matters:

 
(1)
Seller has not caused or allowed the generation, treatment, storage or disposal
of hazardous substances onto, into, at or near the Real Property except in
accordance with federal, state and local statutes, regulations or ordinances
applicable at the time of Closing;

 
(2)
Seller has not caused or allowed the release of any hazardous substance onto,
into, at or near the Real Property in violation of any applicable laws or
regulations in effect at Closing;

 
(3)
To its knowledge, Seller is in compliance with all applicable federal, state and
local statutes, regulations, ordinances and rules regarding the handling of
hazardous substances at the Real Property;

 
(4)
To its knowledge, Seller has secured all necessary permits, licenses and
approvals necessary to the operation of the business on the Real Property and
that Seller is in compliance with all such permits, licenses and
approvals.  Seller has not received and has no knowledge of any violation or
alleged violation of any such permits, licenses and approvals; and

 
(5)
There are no underground storage tanks located on the Real Property.

 
 
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As used herein, the term "hazardous substance" means any hazardous, extremely
hazardous or toxic substance, material, waste, pollutant or effluent including,
but not limited to, asbestos, petroleum and those substances, materials or
wastes listed in or under the Comprehensive Environmental Response, Compensation
and Liability Act of 1980 (42 U.S.C. 9601, et. seq.), as amended by the
Superfund Amendments and Reauthorization Act of 1986 (Pub. L. No. 99-499, and
regulations promulgated thereunder, and such other substances, materials,
wastes, pollutants, air pollutants, toxic pollutants or effluents that are
presently regulated under applicable federal, state and local statutes,
regulations, ordinances or rules and amendments thereto.

 
As used herein, the term "release" means spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping or
disposing of any hazardous substance into or on the soils or waters in, on or
under the Real Property;

(e)
FIRPTA.  Seller is not a "Foreign Person," "Foreign Partnership," "Foreign
Trust," or "Foreign Estate" as those terms are defined in Section 1445 of the
Internal Revenue Code;

(f)
There are no facts known to Seller materially affecting the value of the Real
Property or Buildings which are not readily observable by Purchaser or which
have not been disclosed to Purchaser;

(g)
Seller shall provide a true and accurate schedule of all personal property owned
by it and used in connection with the Buildings, and said schedule shall be
considered to be a part of this Agreement.  All of said personal property is to
be included in this sale and at Closing shall be free and clear of all liens and
encumbrances.  Any personal property that Seller believes is not used in
connection with the Building and which Seller intends to remove shall be listed
on the schedule referred to in this paragraph (g).

(h)
All functional systems and structural components of the Buildings, including
without limitation, the roofs, floors, appliances, controls, fixtures, plumbing,
wiring and any other electrical or mechanical apparatus installed and used in
connection with the Property shall be maintained in their present condition by
Seller until Closing, normal wear and tear excepted;

(i)
Drainage on the Property is sufficient to allow its use and the use of the
improvements thereon without any material interference by standing or draining
water;

(j)
To Seller’s knowledge, no asbestos or asbestos-related products are present in
the Buildings;

(k)
There is no litigation or proceeding of any type pending, or, to the knowledge
of Seller, threatened, against or relating to Seller or the Property, nor does
Seller know or have any reasonable grounds to know of any basis for any such
action, relative to Seller or the Property;

 
 
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(l)
Seller is the sole owner of the Property and the execution and delivery of this
Agreement and the consummation of the sale contemplated hereby are duly
authorized acts of Seller and are legally binding upon Seller.  There are no
outstanding agreements or other impediments prohibiting Seller's closing of the
transaction contemplated hereby in accordance with the terms hereof; and

(m)
All representations and warranties of Seller contained in this Agreement shall
be true at Closing as though such representations and warranties were made at
such time.

7.           Seller's Covenants.  Between the date of the execution of this
Agreement and the Closing, Seller shall:

(a)
Maintain the Property in its present condition, ordinary wear and tear excepted;

(b)
Maintain adequate liability insurance and insurance against loss from fire,
windstorm and other hazards, casualties and contingencies, including vandalism
and malicious mischief with respect to the Property; and

(c)
Operate and manage the Property in the same manner done by Seller prior to the
date hereof.

8.           Prorations.  The following adjustments to the Purchase Price paid
hereunder shall be made between Seller and Purchaser and shall be prorated (as
applicable) on a per diem basis (on a calendar year) up to and including the
Closing Date:

(a)
The portion of the rent paid by Purchaser pursuant to the Commercial Building
Lease by and between Purchaser and Seller dated January 1, 2011, for any days in
the current month after the Closing Date; and

(b)
Utility deposits, rents and all other tenant deposits, premiums under assigned
insurance policies (if any), utility charges and deposits made by Seller with
respect to utilities (which deposits shall either be refunded in full to Seller
or credited to Seller at Closing).

For purposes of all prorations provided for herein, Seller shall be responsible
for all days up to and including the Closing Date, and Purchaser shall be
responsible for all days thereafter.

9.           Transfer Taxes; Title Charges.  Seller and Purchaser agree to
execute any real estate transfer declarations required by the state, county or
municipality in which the Real Estate is located.  Documentary stamps on the
deed and recording corrective instruments shall be paid by Seller.  All other
expenses of sale, including but not limited to title insurance premium,
documentary stamps and intangible tax on mortgage financing, closing costs,
Title Company charges and fees, recording the deed and financing statements and
the like, shall be divided equally between the parties.  If the transaction is
terminated by either party on account of default by the other, the defaulting
party shall pay all escrow costs billed by the Title Company.  If this
transaction shall close as provided in this Agreement, or be terminated other
than on account of the default of either party, the closing fee of the Title
Company shall be paid by Purchaser.  Each party shall pay its own attorneys'
fees except as otherwise provided in this Agreement.
 
 
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10.           Risk of Loss.  Seller shall bear all risk of loss with respect to
the Property up to the Closing Date.  Notwithstanding the foregoing, in the
event of damage to the Property by fire or other casualty prior to the Closing
Date, repair of which would cost less than Ten Thousand ($10,000) Dollars (as
determined by Seller in good faith), Purchaser shall not have the right to
terminate its obligations under this Agreement by reason thereof, but Seller
shall either repair and restore the Property or assign and transfer to Purchaser
on the Closing Date all of Seller's right, title and interest in and to all
insurance proceeds paid or payable to Seller on account of such fire or
casualty.  Seller shall promptly notify Purchaser in writing of any such fire or
other casualty and Seller's determination of the cost to repair the damage
caused thereby.  In the event of damage to the Property by fire or other
casualty prior to the Closing Date, repair of which would cost in excess of Ten
Thousand ($10,000) Dollars (as determined by Seller in good faith), then this
Agreement may be terminated at the option of Purchaser, which option shall be
exercised, if at all, by Purchaser's written notice thereof to Seller within ten
(10) business days after Purchaser receives written notice of such fire
or  other casualty and Seller's determination of the amount of such damages, and
upon the exercise of such option by Purchaser this Agreement shall become null
and void, and neither party shall have any further liability or obligations
hereunder.  If Purchaser does not so elect to termi­nate, then Seller shall
assign and transfer to Purchaser on the Closing Date all of Seller's right,
title and interest in and to all insurance proceeds paid or payable to Seller on
account of such fire or casualty, and Seller shall have no obligation to repair
or restore the Property.

11.           Condemnation.  If between the date of this Agreement and the
Closing Date, any condemnation or eminent domain proceedings are initiated which
might result in the taking of any part of the Real Estate or the Building or the
taking or closing of any right of access to the Property, Purchaser may:

 
(a)
terminate this Agreement by written notice to Seller; or

 
(b)
proceed with the Closing, in which event Seller shall assign to Purchaser all of
Seller's right, title and interest in and to any award made in connection with
such condemnation or eminent domain proceedings.

Seller shall immediately notify Purchaser, in writing, of the commencement or
occurrence of any condemnation or eminent domain proceedings. If such
proceedings would result in the taking of any of the Real Estate or the
Improvements or the taking or closing of any right of access to the Property,
Purchaser shall then notify Seller, within twenty (20) days of Purchaser's
receipt of Seller's Notice, whether Purchaser elects to exercise its rights
under subparagraph (a) or subparagraph (b) of this section 11.  If Purchaser
fails to make an election within such twenty (20) period, Purchaser shall be
deemed to have elected to exercise its rights under subparagraph (b) and Closing
shall be delayed, if necessary, until the later to occur of (i) the Closing Date
or (ii) five (5) days after the expiration of the twenty (20) day period.
 
 
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12.           Default.  If the transaction described in this Agreement is not
consummated as provided herein on the Closing Date by reason of a default by
Seller hereunder, then Purchaser may elect to pursue either of the following
remedies:

(a)
If Seller fails to cure the default within thirty (30) days after written notice
thereof is given by Purchaser to Seller, then Purchaser may terminate this
Agreement by written notice to Seller, in which event all further rights and
obligations of the parties hereunder shall cease; or

(b)
Purchaser may seek specific performance of this Agreement, provided that
Purchaser's right to seek specific performance shall be forfeited if Purchaser
does not commence an action for specific performance within three (3) months
after the end of such thirty (30) day period.

If the transaction described in this Agreement is not consummated as provided
herein on the Closing Date by reason of a default by Purchaser hereunder, then
Seller may elect to pursue either of the following remedies:

(a)
If Purchaser fails to cure the default within thirty (30) days after written
notice thereof is given to Purchaser by Seller, then Seller may terminate this
Agreement by written notice to Purchaser, in which event all further rights and
obligations of the parties hereunder shall cease; or

(b)
Seller may seek specific performance of this Agreement, provided that Seller’s
right to seek specific performance shall be forfeited if Seller does not
commence an action for specific performance within three (3) months after the
Closing Date specified in this Agreement.

13.           Notice.  All notices, demands, requests or other communications
made pursuant to, under or by virtue of this Agreement must be in writing and
either hand delivered, delivered by overnight courier, or mailed through the
United States Postal Service by certified or registered mail, return receipt
requested, to the party to which the notice, demand, request or communication is
being made, as follows:
 
To Seller:
Winland Electronics, Inc.
 
1950 Excel Drive
 
Mankato, MN 56001
 
Attention: Brian D. Lawrence
   
With copy to:
Thomas F. Steichen
 
Fredrikson & Byron
 
200 South Sixth Street
 
Suite 4000
 
Minneapolis, MN 55402

 
 
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To Purchaser:
Nortech Systems Incorporated.
  1120 Wayzata Boulevard East, #201   Wayzata, MN 55391   Attention: Richard
Wasielewski    
With copy to:
Bert M. Gross
  7201 Metro Boulevard   Edina, Minnesota  55439

14.           Time of Essence.  Time is of the essence of this Agreement.

15.           Brokers.  Each party represents and warrants to each other that
they have not dealt with a real estate broker or agent in connection with this
transaction.
 
16.           Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

17.           Assignability.  Purchaser may assign its rights under this
Agreement.  No such assignment will relieve Purchaser of its obligations under
this Agreement.

18.           Binding Effect.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective legal representatives,
successors and permitted assigns.

19.           Modifications; Waiver.  No waiver, modification amendment,
discharge or  change of this Agreement shall be valid unless the same is in
writing and signed by the party against which the enforcement of such
modification, waiver, amendment, discharge or change is sought.

20.           Entire Agreement.  This Agreement contains the entire agreement
between the parties relating to the transactions contemplated hereby and all
prior or contemporaneous agreements, understandings, representations or
statements, oral or written, are superseded hereby.

21.           Attorney Fees.  In the event either party retains the services of
an attorney to successfully enforce its rights under this Agreement, then that
party shall be entitled to recover, in addition to its other damages, its
reasonable attorney's fees, witness fees and other legal costs.

 
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
 

 
SELLER:
         
WINLAND ELECTRONICS, INC.
          By:
/s/ Brian Lawrence
      Brian D. Lawrence, Chief Financial Officer             PURCHASER:        
  NORTECH SYSTEMS INCORPORATED             By: /s/ Richard Wasielewski      
Richard Wasielewski, Chief Financial Officer  

 
 
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY

Lots Four (4) and Five (5), Block Three (3), EXCEPT that part of Lot Five (5)
lying southerly of a line parallel with and distance 201.90 feet south of the
North line of said Lot Five (5), Eastwood Industrial Centre, the five (5)
perimeter corners of which subdivision are marked with Judicial Landmarks.
 
Property ID#: R01.09.10.103.007

      - Eastwood Industrial Centre Lot 4 & N201.9’ 005 003 00 004.480A

 
Property ID#: R01.09.10.103.008

      - Eastwood Industrial Centre Lot Exc N201.9’   000 003 00 001.680A

 
 
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