Document:

Exhibit 10.5

28/04/05

//lzzz1ngfe0

Confidential

DATED: April 28th, 2005

(1)     Northern Technologies International Corporation

(2)     Excor Korrosionsforschung GmbH

(3)     Fibro-NTI Urun Gelistirme Ve Pazarlama Ticaret Anonim

(4)     Acobal SAS

and

(5)     Henkel KGaA

(6)     Henkel Surface Technologies S.A.S

SETTLEMENT AGREEMENT AND ASSET PURCHASE

THIS AGREEMENT is made the 28 day of April 2005

BETWEEN:-

	
  
(1)
  	
  
Northern Technologies International   Corporation a   corporation incorporated under the laws of the State of Delaware whose   principal office is at 6680 North Highway 49, Lino Lakes, Minnesota, USA   (“NTIC”) acting through its duly authorized representatives Gerhard Hahn,   Jacques Manenc and Steven S. Taylorand
  
	
   
  	
  
 
  
	
  
(2)
  	
  
Excor Korrosionsforschung GmbH a corporation incorporated under the laws of   Germany and having offices at Magdeburger Str. 58, 01067 Dresden, GERMANY   (“Excor”); acting through its duly authorized representative Professor Dr.   Georg Reinhard, and
  
	
  
 
  	
  
 
  
	
  
(3)
  	
  
Fibro-NTI Ürün Gelistirme Ve Pazarlama   Ticaret Anonim a   company organized under the laws of Turkey having offices at Karanfil Cad. No: 27, 80620 1. Levent, Istanbul, Turkey, (“Fibro-NTI”) acting through its duly   authorized representative Dr. Mehmet A. Gencer; and
  
	
  
 
  	
  
 
  
	
  
(4)
  	
  
Acobal SAS a corporation incorporated under the laws of   France and having offices at ZI le Clos Marquet, 42400 Saint Chamond, FRANCE   (“Acobal”); acting through its duly authorized representative Jacques   Manencand
  
	
  
 
  	
  
 
  
	
  
(5)
  	
  
Henkel KGaA a company registered under the laws of   Germany and having offices at Henkelstrasse 67, 40191 Duesseldorf, GERMANY   (“Henkel”); acting through its duly authorized representative Dr. Boris   Tasche.
  
	
   
  	
  
 
  
	
  
(6)
  	
  
Henkel Surface Technologies S.A.S, a company registered under the laws of France   and having its offices at 161, rue de Silly, 92100 Boulogne Billancourt,   FRANCE (“HST”), acting through its duly authorized representative Dr. Boris   Tasche.
  

together the “Parties”.

RECITALS

	
  
(A)
  	
  
By deed dated 24 September 2002, NTIC   commenced proceedings in the Civil Court of Nanterre, France, against HST in   respect of the infringement of Community Trade Mark No. 000396176, unfair   competition and breach of confidentiality undertakings.
  
	
  
 
  	
  
 
  
	
  
(B)
  	
  
On 24 September 2002 Acobal, the exclusive   licensee of NTIC in France, commenced proceedings in the Civil Court of   Nanterre, France, against HST in respect of breach of Article L.442-6 of the   French Commercial Code and unfair competition.
  
	
  
 
  	
  
 
  
	
  (C)
  	
  
On 5 May 2003 the Presiding Judge of the   Civil Court of Nanterre ordered that the two sets of proceedings between NTIC   and HST and between Acobal and HST referred to above should be joined and the   joined proceedings transferred to the Civil Court of Paris. These proceedings   are pending before the Civil Court of Paris.
  

1

	
  
(D)
  	
  
After the proceedings in France had   commenced, Henkel commenced proceedings for the cancellation of Community   Trade Mark No. 000396176 owned by NTIC in the Office for the Harmonisation of   the Internal Market (OHIM) in Alicante, Spain.
  
	
  
 
  	
  
 
  
	
  
(E)
  	
  
Henkel now wishes to dispose of certain of   the assets used by it or its Affiliates for the purpose of the Business (as defined below).
  
	
  
 
  	
  
 
  
	
  
(F)
  	
  
The Parties also wish to settle the proceedings referred to above   subject to and in accordance with the terms of this Agreement.
  
	
   
  	
  
 
  
	
  
(G)
  	
  
NTIC is, therefore, willing to waive its asserted entitlement to   damages in the above proceedings on the basis that Henkel is willing to   transfer the said assets to NTIC. Henkel is in return willing to withdraw the   proceedings for the cancellation of Community Trade Mark No 000396176 in the   OHIM, if NTIC and Acobal waive all   and any right relating to the suit pending before the Civil Court of Paris.
  

THE PARTIES AGREE AS FOLLOWS:-

	
  
1.
  	
  
INTERPRETATION AND DEFINITIONS
  
	
  
 
  	
  
 
  
	
  
1.1
  	
  
Definitions
  
	
  
 
  	
  
 
  
	
  
 
  	
  
In this Agreement the following words and phrases shall have the   following meanings:-
  

	
  
 
  	
  
“Affiliate”
  	
  
means in relation to a party, any body corporate or other legal   entity which:-
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(a)
  	
  
is directly or indirectly owned and/or controlled by that party;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(b)
  	
  
that directly or indirectly owns and/or controls that party; or
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(c)
  	
  
is directly or indirectly owned and/or controlled by the legal entity   referred to in (b) above.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
In the case of legal entities having stocks   and/or shares, ownership or control shall exist through the direct or   indirect ownership and/or control of more than fifty percent of the voting   shares.  In the case of any other   legal entity, ownership and/or control shall exist through the ability to directly   or indirectly control the management and/or business of the legal entity   through a majority of voting rights;
  

2

	
   
  	
  
“Assets”
  	
  
means the tangible and intangible assets listed in the Purchase   Agreement;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Business Day”
  	
  
means any day on which banks in the City of Paris are open for   business (excluding Saturdays);
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Effective Date”
  	
  
means the date on which the ownership to the Business and the Assets   is transferred from Henkel and/or its Affiliates to NTIC and/or the NTIC Joint   Venture Companies as will be defined in the Purchase Agreement;
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
“Contracts”
  	
  
means all the contracts, arrangements and engagements relating either   exclusively to the Business or relating in part to the running of the   Business (only to the extent that they do so relate) to which Henkel or any   of its Affiliates are a party as at the Effective Date and which are current   or unperformed as at the Effective Date including, for the avoidance of   doubt, all licences of intellectual property rights used in or relevant to   the Business or Technology with the exception of standard software contracts,   however, excluding
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
a)
  	
  
contracts relating to public utilities (supply of electricity, gas,   water, etc.);
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
b)
  	
  
contracts relating to the lease of telecommunication equipment   assistance with respect to the business (including without being limited   thereto, phone and fax systems) or any of the pertinent maintenance   Contracts;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
c)
  	
  
contracts relating to any real property (including but not limited to   leases);
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
d)
  	
  
contracts of insurance relating to the Business;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
e)
  	
  
contracts concluded with an affiliate company;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Customer Lists”
  	
  
means lists of all customers of the Business in the Settlement   Territory;
  

3

	
  
 
  	
  
“Encumbrance”
  	
  
means and includes any interest and equity of any person (including   without prejudice to the generality of the foregoing, any right to acquire,   option or right of pre-emption) or any mortgage, charge, pledge, lien,   hypothecation or assignment or any other encumbrance, priority or security   interest or arrangement of whatsoever nature over or in the relevant   property;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“French Action”
  	
  
means the proceedings details of which are set out in Schedule 1;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Goodwill”
  	
  
means the goodwill of the Business including the exclusive right of   NTIC and/or the NTIC Joint Venture Companies to represent itself as carrying   on the Business in continuation of and in succession to Henkel and its   Affiliates, which for the avoidance of doubt, shall not include the name Henkel;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“the Business”
  	
  
means Henkel’s and/or its Affiliates’ business anywhere in the world   relating to the development, manufacture, distribution, sale, supply,   marketing of or otherwise trading in products utilising the Technology;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Intellectual Property”
  	
  
means any patents, trade marks, service marks, registered designs,   applications for any of those rights, trade and business names (including   Internet domain names and e-mail address names but excluding any name   including the name Henkel), logos, unregistered trade marks and service   marks, copyright and related rights, performers’ property rights, database   rights, rights in designs, trade dress, inventions, know-how and confidential   information owned by Henkel or its Affiliates in the Settlement Territory in   relation to the Business or the Technology and, without limitation, includes   all trade marks, design rights, patents, patent applications, know-how,   copyright and database rights set out in the Purchase Agreement, together   with the right to sue for past infringements of such rights;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
Inventory
  	
  
means all Product held or owned by Henkel and/or its Affiliates on   the Effective Date for sale in the Business.
  

4

	
  
 
  	
  
“IP and Goodwill Assignment”
  	
  
means the assignment of Intellectual Property and Goodwill according   to the Purchase Agreement;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Know-How”
  	
  
means the know-how assigned to NTIC or the NTIC Joint Venture   Companies according to the Purchase Agreement;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
“NTIC Joint Venture Companies”
  	
  
means the companies set out in Schedule 4;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“OHIM Proceedings”
  	
  
means the proceedings details of which are set out in Schedule 2;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Settlement Territory”
  	
  
means the world;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Product”
  	
  
means any product developed using the Technology as part of the   Business;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
“Purchase Agreement”
  	
  
means the contract(s) to be concluded between Henkel or its   Affiliates and NTIC or the NTIC Joint Venture Companies to assign the part of   the Business belonging to Henkel or the respective Affiliates to NTIC or the   NTIC Joint Venture Companies and whose form has previously been agreed   between the Parties; and
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
“the Technology”
  	
  
means post-manufacture non-contact corrosion protection  technologies including, without   limitation, VCI delivery systems such as capsules, films, papers and other   host materials and other systems for protecting industrial and commercial   products against chemical, electrostatic, physical and environmental damage   and corrosion including non-contact barrier protection and scavenger   protection systems.
  

	
  1.2
  	
  
Construction and Interpretation
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
1.2.1
  	
  
In this Agreement the headings are for convenience only and shall not   affect the interpretation hereof;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
1.2.2
  	
  
reference in this Agreement to Clauses or Schedules are to clauses of   or the schedules to this Agreement;
  

5

	
  
 
  	
  
1.2.3
  	
  
unless the context shall otherwise require the singular shall include   the plural and vice versa, reference to any gender shall include references   to the other genders and references to persons shall include bodies   corporate, unincorporated associations and partnerships ;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
1.2.4
  	
  
this Agreement includes the Schedules hereto;
  

	
  
2.
  	
  
TERMINATION OF THE PROCEEDINGS AND SETTLEMENT AGREEMENT
  
	
  
 
  	
  
 
  	
  
 
  
	
  
2.1
  	
  
French Action
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.1.1
  	
  
Within seven   (7) days of the date of this Agreement NTIC and ACOBAL shall notify the Court   of Paris -“Tribunal de Grande Instance” - of their withdrawal from all of   their actions and claims in relation to the French Action, and their   undertaking not to introduce further proceedings which may be based on the same   facts as the French Action, these statements referred to as “conclusions de   désistement  d’action et d’instance”   being attached hereto as Schedule 3.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.1.2
  	
  
As for HST,   it shall file, at the date of the said notifications, with the court of Paris   – “Tribunal de Grande Instance”- a statement by which HST accepts the above   withdrawal and undertaking by NTIC and ACOBAL to refrain from future   proceedings, this statement referred to as, “conclusions d’acceptation de   désistement d’action et d’instance” being attached hereto as Schedule 3.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.1.3
  	
  
NTIC and   ACOBAL simply and purely waive all and any rights to sue and/or to claim, in   respect to which the facts invoked by NTIC and ACOBAL within the scope of the   pending proceedings before the Civil Court of Paris – “Tribunal de Grande   Instance” - should constitute the consideration, the object or the occasion.
  

	
  2.2
  	
  
OHIM Proceedings
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.2.1
  	
  
Within seven   (7) days of the date of this Agreement, the Parties and their Affiliates   and/or Joint Venture Companies shall take all necessary steps to terminate   definitively the OHIM proceedings.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.2.2
  	
  
On the date   of this Agreement, Henkel shall notify OHIM that it is definitively   withdrawing from the OHIM Proceedings in the terms of the letter set out in   part 2 of Schedule 2.
  

6

	
   
  	
  
2.2.3
  	
  
In addition,   Henkel undertakes not to introduce further proceedings challenging the   validity of Community Trade Mark N° 000396176.  In addition, Henkel undertakes not to assist, procure or incite   any person to do so and guarantees that its Affiliates shall also not do so.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
2.3
  	
  
Cost of proceedings and damages
  
	
  
 
  	
  
 
  
	
  
 
  	
  
2.3.1
  	
  
Each of the   Parties shall bear all expenses, fees, disbursements and costs that they have   already paid and/or advanced or that they will have to pay for the   introduction and the termination of the aforementioned proceedings and, in   particular, all costs relating to the counsels, lawyers, judicial auxiliaries   and clerks.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
2.3.2
  	
  
The Parties   undertake not to claim any damages for the termination of the aforementioned   proceedings.  In addition, they   guarantee that their Affiliates and/or Joint Venture Companies will not claim   any damages.
  
	
   
  	
  
 
  	
  
 
  
	
  
2.4
  	
  
Settlement Agreement
  
	
  
 
  	
  
 
  
	
  
 
  	
  
The Parties   recognize that the withdrawal from all of the actions and claims referred to   in paragraph 2.1 and 2.2 above, constitutes reciprocal concessions under   French law, taking into account that NTIC and ACOBAL, in particular, are   directly affected by the OHIM proceedings.
  
	
  
 
  	
  
 
  
	
  
 
  	
  
The Parties   decided to submit this Agreement to article 2044 and following of the French   Civil Code, specially referring to the provisions of the following articles:
  
	
  
 
  	
  
 
  
	
  
 
  	
  
- Article   2044: “a compromise is a contract by which the parties settle an arisen   controversy, or prevent a controversy from arising. That contract must be   made in writing”.
  
	
   
  	
  
 
  
	
  
 
  	
  
- Article   2052:  “Compromises have, between the   parties, the authority of res judicata of a final judgement. They may not be   attacked on account of an error of law, nor on account of loss”.
  
	
  
 
  	
  
 
  
	
  
 
  	
  
This Settlement   Agreement immediately and definitively binds the Parties, whatever will be   the execution of the provisions included in the following articles dealing   with the Asset Purchase.
  
	
  
 
  	
  
 
  
	
  
3.
  	
  
ASSET PURCHASE
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Henkel undertakes to sell – and if Henkel is not the owner shall   procure that its Affiliates sell – without undue delay according to the   national laws of the countries concerned, the Business within the Settlement   Territory with effect from the Effective Date.
  
	
   
  	
  
 
  
	
  
 
  	
  
Henkel also undertakes and shall procure that its Affiliates shall   from the date of this Agreement initiate the internal legal formalities with   a view to selling the Business. Henkel undertakes to procure that NTIC and/or   the NTIC Joint Venture Companies appointed in each concerned country (or   created to that effect) acquire the Business from Henkel or its Affiliates   within 3 (three) months from the date of this Agreement.
  

7

	
  
3.1
  	
  
Object of the sale
  
	
  
 
  	
  
 
  
	
  
 
  	
  
3.1.1
  	
  
The sale will cover tangible and intangible goods (in so far as the   national laws know this denomination) attached to the Business.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.1.2
  	
  
Within the scope of the sales which will occur according to national   laws:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(a)
  	
  
Henkel shall provide all Customer Lists to NTIC or the NTIC Joint   Venture Companies in electronic form in the manner and format as agreed upon   between the Parties.  The transfer of   such information shall be done respecting EC Directive 95/46 and French Law 78-17 of 6 January   1978.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(b)
  	
  
Henkel   undertakes that it shall not use or reproduce the Customer Lists, or   distribute or disclose the Customer Lists to any third party, for any purpose   whatsoever except if Henkel is required to do so under any court or   governmental authority order or to comply with any legal obligation.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(c)
  	
  
Within ten   (10) Business Days of the Effective Date Henkel shall, and shall procure that   its Affiliates shall, delete or destroy all copies of all Customer Lists (to   the extent that the Customer Lists are not required for the ongoing business   of Henkel and/or its Affiliates and Henkel and/or its Affiliates are not   obliged to keep the Customer Lists to comply with any legal obligation or   internationally recognised accounting standards) and shall confirm in writing   to NTIC that it has done so.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
a)
  	
  
Henkel shall, and shall procure that, if necessary, its Affiliates   shall, execute the IP and Goodwill Assignment in order to transfer   irrevocably and absolutely all right, title and interest in the Intellectual   Property to NTIC.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
b)
  	
  
Henkel undertakes that if following the Effective Date it or any of   its Affiliates develops or acquires any improvements or modifications to any   of the Intellectual Property, Henkel grants and shall, if necessary procure   that its Affiliates shall grant, to NTIC or the NTIC Joint Venture Companies,   a pre-emptive right to acquire such improvements or modifications during the   non-competition period as defined in 3.6.1.1 below, in good faith, at a fair   market price.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.1.3
  	
  
Henkel or   its Affiliates are willing to accompany NTIC or the NTIC Joint Venture   Companies to one single visit to each of the twenty major customers   identified by NTIC or the NTIC Joint Venture Companies during the first three   months after the Effective Date.
  

8

28/05/04

	
  
 
  	
  
3.1.4
  	
  
Henkel undertakes   that it shall not, and that it will procure that its Affiliates shall not,   acquire more than 5% of the issued share capital of NTIC at any time in the   future.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.1.5
  	
  
The Parties hereto understand and agree that the assets of Henkel or   its Affiliates set out below are excluded from the sale and transfer to NTIC:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
a)
  	
  
all real property leased which is not exclusively related to the   Business;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
b)
  	
  
all plants used or to be used by Henkel and its Affiliates for   manufacturing the Products;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
c)
  	
  
all accounts and notes receivable, deferred charges, chattel paper   and other rights to receive payments arising from the operation of the   Business prior to the Effective Date;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
d)
  	
  
cash, cash equivalents, investments and bank accounts (whether   credits or debits) as at the Effective Date;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
e)
  	
  
all tax liabilities or tax refunds, including value added and   corporate income taxes and all fiscal taxes, social security   taxes/contributions and other levies arising from or relating to the operation   of the Business or the ownership of the Assets prior to the Effective Date;
  

	
  
3.2
  	
  
Employment Matters
  
	
  
 
  	
  
 
  
	
  
 
  	
  
3.2.1
  	
  
The parties   agree that the sale and purchase of the Business and the Assets according to   this Agreement constitutes a transfer of business pursuant to EC directive   and to article L 122-12 of the French Labour Code. Accordingly, any and all   employees dedicated to the Business and employed by Henkel or the Henkel   Affiliates at the Effective Date shall be automatically transferred to NTIC   or its Affiliates (Transferred Employees) under the same terms and conditions   of employment. A list of all current employees dedicated to the Business,   indicating their   name, commencement date with Henkel or the respective Henkel Affiliate, and   function will be added to the Purchase Agreement.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.2.2
  	
  
All amounts payable to or in relation to the Transferred Employees   including but not limited to wages and salaries in respect of all periods   prior to the Effective Date shall be paid by Henkel or the respective Henkel   Affiliate and Henkel shall indemnify NTIC against any reasonable costs,   claims, liabilities, obligations, demands and expenses arising out of or in   connection with such amounts.  Henkel   shall discharge and indemnify
  

9

	
  
 
  	
  
 
  	
  
NTIC against all and any reasonable costs, claims, liabilities,   obligations, and expenses arising out of: any persons other than the   Transferred Employees who are or have been at any time prior to the Effective   Date engaged to any extent in the Business; any of the Transferred Employees   before the Effective Date; any obligation to inform and consult   representatives of the Transferred Employees or otherwise in accordance with   article L 122-12 of the French Labour Code; and all accrued holiday pay   entitlements and accrued but unused holiday entitlements of the Transferred   Employees which accrue during any period prior to the Effective Date, as the   case may be.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.2.3
  	
  
Henkel and/or HST will forward in conformity with French law all   necessary documents including the respective Trust Deeds and Employees   Handbooks and forward all necessary and requested declarations to ACOBAL in   order to enable ACOBAL to effect the above transfer of employees.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.2.4
  	
  
ACOBAL shall be responsible for any severance benefits, redundancy   costs or any other costs related to the non observance of notice periods or   any financial or other obligation related to the Transferred Employees in   connection with the termination of their employment with ACOBAL in case a   Transferred Employee refuses a modification of its employment contract in   connection with its transfer to ACOBAL, unless HST terminates the employment   due to reasons other than the transfer of the Business to ACOBAL.
  

	
  3.3
  	
  
Assignment of Contracts
  
	
  
 
  	
  
 
  
	
  
 
  	
  
3.3.1
  	
  
Subject to paragraph 3.3.4. below, Henkel or the Henkel Affiliates   shall assign with effect from the Effective Date to NTIC or the NTIC Joint   Venture Companies the Contracts listed in the Purchase Agreement(s). Such   assignment shall encompass all and any rights, interests, obligations and   liabilities under the Contracts.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.3.2
  	
  
Prior to the Effective Date for any other Contracts exclusively   belonging to the Business and not listed in the Purchase Agreement(s), NTIC   or the NTIC Joint Venture Companies shall have until the Effective Date to   decide whether or not they assume all rights and obligations and the   performance of such Contract(s). With regard to Contracts which will be   concluded with distributors and agents, the Purchase Agreements contain   specific provisions.
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
3.3.3
  	
  
After the Effective Date, the following Contracts which are not   listed in the Purchase Agreement(s) are hereby assigned to NTIC or the NTIC   Joint venture Companies:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(a)
  	
  
all Contracts with customers to the Business;
  

10

	
  
 
  	
  
 
  	
  
(b)
  	
  
all and any other Contracts which do not impose a financial   obligation or liabilities exceeding Euros 10,000 (ten thousand) per year   and which exclusively refer to the Business.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.3.4
  	
  
Where any consent or agreement of the other party to any of the   Contracts or of any third party is required to enable NTIC or the NTIC Joint   Venture Companies to assume all rights and obligations under and to perform   any Contract or to enable Henkel or its Affiliates to assign or transfer the   benefit or burden of any Contract to NTIC or the NTIC Joint Venture   Companies, the following provisions shall apply:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
a)
  	
  
Henkel or its Affiliates and NTIC or the NTIC Joint Venture Companies   shall use their respective reasonable endeavours to obtain the consent or agreement   of the other party or any third party to whatever assignment, transfer or   novation is necessary to enable NTIC or the relevant NTIC Joint Venture   Companies to assume all rights and logistics under and to perform such   Contract after completion or, as the case may be, to transfer the benefit and   burden of such Contract to NTIC or the relevant NTIC Joint Venture Companies.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
b)
  	
  
Until the consent or agreement referred to in sub-paragraph a) above   is obtained, NTIC or the relevant NTIC Joint Venture Companies shall, unless   the relevant Contract prohibits it, perform all the obligations of Henkel or   the relevant Henkel Affiliate under such Contract as agent for, or   sub-contractor to, Henkel or such Henkel Affiliate and indemnify Henkel or   the respective Henkel Affiliate in respect of such performance, or, if the   relevant Contract or any provision of a applicable law prohibits NTIC or the   relevant NTIC Joint Venture Companies from acting so or NTIC or the relevant   NTIC Joint Venture Companies cannot be permitted to act as agent and   sub-contractor because of confidentiality obligations, Henkel shall to the   extent it is reasonably able to do so, do or procure the doing by any of the   Henkel Affiliates of all such acts and things as NTIC may reasonably require   to enable due performance of the Contract to provide for NTIC
or the relevant   NTIC Joint Venture Companies the benefits subject to the burdens of the   Contract and NTIC shall indemnify Henkel or the relevant Henkel Affiliate in   respect of all such acts and things. For this purpose, it shall not be   reasonable to require Henkel or any of the Henkel Affiliates to make any   payments unless NTIC or the relevant NTIC Joint Venture Companies have first   paid Henkel or the relevant Henkel Affiliate sufficient cleared funds to make   such payment.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
3.3.5
  	
  
If a consent cannot be obtained, Henkel or the relevant Henkel   Affiliate shall be deemed to hold the benefit of the relevant Contract on   trust for NTIC or the relevant NTIC Joint Venture Companies, until such time   as consent by the respective party or third party is obtained.
  

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3.3.6
  	
  
As regards non-compete, non-disclosure and confidentiality agreements   relating to the Business and/or the Assets, NTIC or the NTIC Joint Venture   Companies shall have the right to assume them or, in each case, to refuse to   assume them, unless such an agreement is listed in the Purchase Agreement.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
3.4
  	
  
Transfer of Inventory at the Effective Date
  
	
  
 
  	
  
 
  
	
   
  	
  
The Inventory shall be transferred to ACOBAL or the NTIC Joint   Venture Company in Turkey as appropriate.
  
	
  
 
  	
  
 
  
	
  
 
  	
  
The Parties   have set out a first estimate of the price of the Inventory in clause 3.5 of   this Agreement.  The actual purchase   price for such Inventory shall be calculated by using the same methods and in   the same manner as specified in the relevant Purchase Agreement.
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Henkel or its Affiliates shall provide the respective invoices for   the Inventory which will be submitted to the applicable national rules and   regulations, notably regarding VAT.
  
	
  
 
  	
  
 
  
	
  
 
  	
  
The Parties undertake that any Products stored for more than 6 (six)   months without any sale are worthless and shall not be taken into account in   calculating the sum payable under 3.5.1.3 below.  Such Inventory shall nonetheless be transferred to NTIC or the   NTIC Joint Venture Companies.
  
	
   
  	
  
 
  
	
  
 
  	
  
NTIC and the NTIC Joint Venture Companies further undertake to be   responsible for ensuring that no raw materials (such as masterbatch or resin)   which are not transferred as part of the Inventory do not fall into the hands   of any third party who may use such materials to produce counterfeit   products.
  

	
  
3.5
  	
  
Purchase Price
  
	
  
 
  	
  
 
  
	
  
 
  	
  
3.5.1
  	
  
In consideration of the sale and transfer of the Assets and the   Intellectual Property, NTIC or the NTIC Joint Venture Companies shall pay as   a net purchase price to Henkel or to its Affiliates owning the Business €   1,500,000 (Euro one million five hundred thousand) (hereinafter “the net   Purchase Price”) divided up among NTIC and the NTIC Joint Venture Companies   as follows:
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.5.1.1
  	
  
NTIC shall pay € 450,000 (Euro four hundred and fifty thousand) in   consideration for the Intellectual Property;
  

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3.5.1.2
  	
  
ACOBAL shall pay:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
 
  	
  
3.5.1.2.1
  	
  
€ 550,000 (Euro five hundred fifty thousand) in consideration for the   Fonds de Commerce (tangible and intangible assets) of HST.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
3.5.1.2.2
  	
  
€ 300,000 (Euro three hundred thousand) in consideration for the   Inventory of HST.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.5.1.3
  	
  
Fibro-NTI shall pay:
  
	
   
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
3.5.1.3.1
  	
  
€ 100,000 (Euro one hundred thousand) in consideration for the Fonds   de commerce (tangible and intangible assets) of Türk Henkel Kimya Sanayi ve   Ticaret AS.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  	
  
3.5.1.3.2
  	
  
€ 100,000 (Euro one hundred thousand) in consideration for the   Inventory of Türk Henkel Kimya Sanayi ve Ticaret AS.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
3.5.2
  	
  
Should the stock taking as described in Clause 3.4 turn out that the   value of the Inventory exceeds or is lower than the sums attributed above in   clauses 3.5.1.2.2 and 3.5.1.3.2, the net Purchase Price shall be adjusted   accordingly
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.5.3
  	
  
The net Purchase Price shall be paid by NTIC and the NTIC Joint   Venture Companies as set out under Clause 3.5.1to Henkel or its Affiliates   either by means of a wire transfer to bank accounts to be indicated at the   Effective Dates specified in the different Purchase Agreements which will be   concluded in conformity with the national laws concerned.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.5.4
  	
  
It is the intention of the Parties that the Business shall be   transferred to NTIC or the NTIC Joint Venture Companies as a going concern   with effect from the Effective Date and the Parties will use all reasonable   endeavours to secure that the sale is neither treated as a supply of goods   nor a supply of services for the purposes of Value Added Tax. To the extent   that certain transactions are nevertheless subject to Value Added Tax (or   equivalent sales tax), NTIC or the NTIC Joint Venture Companies shall pay   such tax in addition to the net Purchase Price. Such a value added tax will   be due and payable when NTIC or the NTIC Joint Venture Companies shall have received   from Henkel or its Affiliates an invoice issued in accordance with the   applicable local or national regulations. Any other taxes imposed in   connection with the sale and transfer of the Business shall be paid by NTIC   or the NTIC Joint Venture Companies (including but not limited to
stamp and   registration duties in France and in Turkey).
  
	
   
  	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.5.5
  	
  
Henkel or the respective Henkel Affiliate shall remain responsible   for all taxes (e.g. income tax, Value Added Tax, payroll taxes) inherent to   the Business until the Effective Date and shall indemnify NTIC and the NTIC   Joint Venture Companies in respect of the same.
  

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3.6
  	
  
Non competition clause
  
	
  
 
  	
  
 
  
	
  
 
  	
  
3.6.1
  	
  
Henkel undertakes to NTIC and its Affiliates, that it shall not, and   shall procure that its Affiliates shall not:
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.6.1.1
  	
  
for a period of three years from the Effective Date directly or   indirectly be engaged, or directly or indirectly be interested, in carrying   on any business similar to the Business, or that competes in any manner   whatsoever with any business carried on by NTIC or the NTIC Joint Venture   Companies utilising or concerning the Technology;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.6.1.2
  	
  
Notwithstanding the foregoing for a period of three years from the Effective Date solicit   or entice away or assist any other person to solicit or entice away the   custom of any person, firm, company or organisation who either was at the   Effective Date, or during the period of 6 (six) months prior to the Effective   Date had been, a client, customer, identified prospective client, customer,   representative, agent, correspondent or supplier of the Business. For the   avoidance of doubt, nothing in this clause will prevent Henkel and its   Affiliates from dealing with any such person, firm, company or organisation   in a part of its business which is unrelated to the Business; or
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.6.1.3
  	
  
assist any other person to do any of the foregoing things.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.6.2
  	
  
Henkel undertakes to take all such steps as shall from time to time   be necessary to ensure compliance with the terms of clause 3.6.1 by employees   and agents of Henkel and its Affiliates.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.6.3
  	
  
Each of the undertakings in clause 3.6.1 shall be construed as a   separate and independent undertaking and, subject to sub-clause 3.6.4. if one   or more of the undertakings is held to be void and unenforceable, the   validity of the remaining undertakings shall not be affected.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.6.4
  	
  
While the restrictions contained in Clause 3.6. are considered by the   Parties to be reasonable in all the circumstances, it is recognised that   restrictions of the nature in question may be deemed unreasonable and   accordingly it is hereby agreed and declared that if any of such restrictions   shall be adjudged to be void or voidable as going beyond what is reasonable   in all the circumstances for the protection of the interests of NTIC but   would be valid if part of the wording thereof were deleted, or the periods   thereof reduced or the range of activities or area dealt with thereby reduced   in scope, the said restriction shall apply with such modifications as may be   necessary to make it valid and effective.
  

14

	
  
 
  	
  
3.6.5
  	
  
Without prejudice to sub-clause 3.6.4, if any restriction or   undertaking is found by any court or other competent authority to be void or   unenforceable, the Parties shall negotiate in good faith to replace such void   or unenforceable restriction or undertaking with a valid provision which, as   far as possible, has the same legal and commercial effect as that which is   replaced.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
3.7
  	
  
Indemnification
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.7.1
  	
  
NTIC undertakes and engages to fully and timely release and indemnify   Henkel respectively the Henkel Affiliates as of the Effective Date from all   and any such obligations and liabilities of the Business:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
–
  	
  
as NTIC or the NTIC Joint Venture Companies have assumed under this   Agreement; or
  
	
   
  	
  
 
  	
  
–
  	
  
as arise from the continuation of the Business by NTIC or the NTIC   Joint Venture Companies after the Effective Date unless this Agreement   provides otherwise;
  
	
  
 
  	
  
 
  	
  
–
  	
  
as arise from the employment by NTIC or the NTIC Joint Venture   Companies of the Transferred Employees on or after the Effective Date or are   attributable to any breach or default by NTIC or the NTIC Joint Venture   Companies in relation to any of the Transferred Employees including but not   limited to any liability arising out of the termination or dismissal of any   Transferred Employees or any failure by NTIC or the NTIC Joint Venture   Companies to offer terms and conditions which are not less favourable than   those which apply up to the Effective Date.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.7.2
  	
  
Henkel undertakes and engages to fully and timely release and   indemnify NTIC and respectively the NTIC Joint Venture Companies from all and   any claims, law suits, costs and expenses, liabilities and damages arising   out of a breach of any of the warranties granted in Article 3.9 below. In any   case such liability of Henkel shall be limited as further specified in   Article 3.10.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.7.3
  	
  
For the avoidance of doubt NTIC and the NTIC Joint Venture Companies   shall have no responsibility for or any liability in respect of any product   liability or other claims made in relation to any Products supplied by or on   behalf of Henkel or its Affiliates prior to the Effective Date to customers   or as part of the Inventory being transferred to NTIC or the NTIC Joint Venture   Companies.  Henkel hereby confirms   that any such Product was manufactured or supplied subject to appropriate   product liability insurance.
  

	
  
3.8
  	
  
Miscellaneous
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.8.1
  	
  
To the extent that specific deeds, instruments or documents or any   other steps are necessary or expedient to effecting and documenting the   transfer of the Assets, the Parties undertake and agree, at either Parties’   request and waiving any further consideration or compensation, to promptly   execute such deeds, instruments or documents and take all such steps.
  

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3.8.2
  	
  
Henkel and its Affiliates will assist and co-operate with NTIC and   the NTIC Joint Venture Companies, to an extent reasonably requested by NTIC,   in notifying debtors of sold rights and claims and/or in notifying any third   party which holds any title, interest or possession with respect to the   Assets.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.8.3
  	
  
Henkel shall hand all documents constituting, representing or   containing the Assets to NTIC without endangering the continuance of the   Business, in the manner and format as agreed upon between the Parties.
  

	
  3.9
  	
  
Warranties
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.1
  	
  
Each of the Parties represents and warrants that it has full power   and authority to enter into this Agreement and to perform its respective   obligations set out in this Agreement.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.2
  	
  
Henkel warrants, in relation to the Intellectual Property, that to   its best knowledge, as at the date of this Agreement, and unless otherwise   disclosed to NTIC:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
3.9.2.1
  	
  
a complete and accurate record of all material Intellectual Property   will be attached to the Purchase Agreement;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.2
  	
  
All registered Intellectual Property is valid and subsisting in the   jurisdictions where registered or granted;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.2A
  	
  
All licences of intellectual property rights used in or relevant to   the Business or the Technology to which Henkel or its Affiliates are subject   have been disclosed to NTIC;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.3
  	
  
Henkel and / or its Affiliates are the sole legal and beneficial   owner of the Intellectual Property with the right to assign all right, title   and interest in the Intellectual Property and all predecessors in interest   have assigned their entire right, title and interest in the Intellectual   Property to Henkel and / or its Affiliates;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.4
  	
  
Henkel and / or its Affiliates have not previously licensed or   assigned the Intellectual Property to any third party, or entered into any   agreement relating to it with any third party which might affect Henkel’s and   / or its Affiliates’ ability to assign the Intellectual Property to NTIC in   accordance with the provisions of this Agreement;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
3.9.2.5
  	
  
The Intellectual Property is not subject to any charges, options,   licences or other third party interests;
  

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3.9.2.6
  	
  
Where registered, all registrations, filings and payments of fees   necessary to preserve the rights of Henkel and/ or its Affiliates in the   Intellectual Property have been made and are in good standing, and Henkel and   / or its Affiliates have not done or omitted to do anything which may cause   any of the registered Intellectual Property to lapse prematurely;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.7
  	
  
Neither Henkel nor its Affiliates have been notified that any   opposition, cancellation or revocation action or protest has been filed with   any examining authority in relation to any application to register the   Intellectual Property, or existing registration;
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.8
  	
  
Henkel is not aware of any fact or matter that could affect the   validity or registerability of the Intellectual Property;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.2.9
  	
  
Neither Henkel nor its Affiliates have granted to any of their   respective sub-contractors, agents or other contracting parties the right to   use any know-how or intellectual property, relating to the Technology, for   its own benefit or for the benefit of a third party.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
3.9.3
  	
  
there are no allegations or proceedings pending or to the best of   Henkel’s knowledge, threatened, which assert that the development,   manufacture, use or sale of any Product infringes or will infringe third   party rights or which challenge the ownership, validity or enforceability of   the Intellectual Property;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.4
  	
  
Henkel has made a full and complete disclosure to NTIC of all third   party relationships which to the best knowledge of Henkel having made a   diligent search of appropriate records may affect NTIC’s full and complete   exercise of rights under this Agreement;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.5
  	
  
except in the ordinary course of business and under appropriate   confidentiality agreements copies of which have been provided to NTIC, no   disclosure has been made to third parties of any of the confidential   information, Know-How, technical processes, financial or trade secrets or   pricing, customer or supplier lists relating to the Business; and
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.6
  	
  
all documents or other materials in which the Intellectual Property   subsists, and all certificates or other documents evidencing or otherwise   relating to the ownership of such rights, are in the possession, ownership   and control of Henkel, and Henkel is not a party to any confidentiality or   other agreement or subject to any duty which restricts the free use or   disclosure of such documents or materials.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.9.7
  	
  
Henkel shall procure that any Affiliate that owns any Intellectual   Property shall give the same warranties to NTIC as are contained in clause   3.9.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
3.9.8
  	
  
Henkel warrants that, in relation to the Assets:
  

17

	
  
 
  	
  
 
  	
  
3.9.8.1
  	
  
it and/or its Affiliates own all the Assets absolutely as at the   Effective Date.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.8.2
  	
  
it has not nor have its Affiliates disposed of or agreed to dispose   of or granted or agreed to grant any Encumbrance in respect of any of the   Assets; and
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.8.3
  	
  
there has been no exercise, purported exercise or claim for   Encumbrance over any of the Assets and there is no dispute directly or   indirectly relating to any of the Assets.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.9.8.4
  	
  
the Products in the stocks as of the Effective Date comply with the   specifications as defined in the control parameters as defined in the quality   control documentation for finished goods.
  

	
  3.10
  	
  
Limitation of liability
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.10.1
  	
  
Henkel or its Affiliates shall have no obligation to provide   indemnification with respect to any individual claim for indemnification by   NTIC or the NTIC Joint Venture Companies except to the extent that the amount   of indemnification to which NTIC or its Affiliates shall have become entitled   under this Agreement with respect to such individual claim for   indemnification shall exceed € 10,000,- (Euro ten thousand), in which event   Henkel or its Affiliates shall be obligated to provide indemnification on a   first Euro basis, including the first € 10,000,- (Euro ten thousand).
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.10.2
  	
  
In no event shall Henkel or its Affiliates have any liability for   indemnification under this Agreement to NTIC or the NTIC Joint Venture   Companies in an aggregate amount in excess of € 500,000 (Euro five hundred   thousand). Such limitation of liability shall not apply with regard to claims   which are based on product liability claims due to products which Henkel or   its Affiliates have manufactured and / or sold.
  
	
   
  	
  
 
  	
  
 
  
	
  
3.11
  	
  
Legal Relations prior to the Effective Date
  
	
  
 
  	
  
 
  	
  
 
  
	
  
For the   period between the date of this Agreement and the Effective Date, Henkel   shall assume and procure its Affiliates to assume certain obligations set out   hereinafter:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.11.1
  	
  
to continue   until the Effective Date to conduct the Business according to its present   practice and levels of activity depending on market conditions in a due   proper and prudent manner in the ordinary course and as a going concern:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.11.2
  	
  
prior to the   Effective Date not to enter into (otherwise than after NTIC’s or the NTIC   Joint Venture Companies’ written consent) any transaction or event which is   materially prejudicial to the Business or to any of the Assets or which is   unusual or onerous having regard to the present levels of activity of the   Business;
  

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3.11.3
  	
  
prior to the   Effective Date not to sell, transfer, lease, assign or otherwise dispose of a   material part of its undertaking, property or assets relating to the Business   otherwise than in the ordinary and proper course of the Business;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.11.4
  	
  
not to enter   into any contract or transaction except on an arms length basis;
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  3.12
  	
  
Future Co-operation between the Parties
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
NTIC and Henkel agree to enter into a co-operation arrangement, in   conformity with all relevant regulations involved (including but not limited   to EU law) between NTIC, the NTIC Joint Venture Companies, and Henkel and the   Henkel Affiliates in respect of:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
–
  	
  
the joint development and marketing of, in the case of NTIC and the   NTIC Joint Venture Companies compatible technology and in the case of Henkel   and the Henkel Affiliates, the complementary products or services;
  
	
  
 
  	
  
–
  	
  
research and development in order to increase or enhance the mutual   compatibility;
  
	
   
  	
  
–
  	
  
introduction by NTIC to Henkel and the Henkel Affiliates of new   technology .
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  

The purpose of such  cooperation  shall be to create synergies so as to increase
customer   value  in   respect  of  the   product  or  service   lines  of  both
businesses. Such  co-operation is an essential element of this Agreement for NTIC
and the NTIC Joint Venture  Companies and was a material  inducement for them to
enter into this  Agreement.   NTIC and the NTIC Joint Venture  Companies on
the one hand, and Henkel and its Affiliates on the other,  accept the tenet that
despite their reasonable best efforts, there is an inherent entrepreneurial risk
that  the  intended  co-operation  may not  result  in any  economically  viable
technical and/or product  innovation which the Parties can jointly  introduce to
the marketplace on a profitable basis.
 
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.12.1
  	
  
Subject to the terms of any agreement entered into between the   parties, NTIC and Henkel are prepared to work with each other and to disclose   relevant know-how under appropriate terms of confidence subject to reasonable   royalties or compensation where value is added to Henkel or its Affiliates’,   or NTIC’s and the NTIC Joint Venture Companies’, respective ongoing business.   NTIC and Henkel will agree on marketing costs and their allocation between   the parties.  Any agreement will,   therefore, address issues including the use of confidential information, the   ownership of background and foreground intellectual property, and   exploitation rights.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.12.2
  	
  
The Parties shall not have entered this Agreement if they had not   seriously believed that a serious and faithful co-operation between   themselves was possible.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
Henkel and NTIC shall designate members to a steering committee. The   steering committee shall:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
–
  	
  
determine its missions;
  

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–
  	
  
fix its meeting periodicity (depending on the projects and the   regional needs);
  
	
  
 
  	
  
–
  	
  
decide on the sectors of potential cooperation of such Committees.
  

The steering committee shall consist of the following members: 

	
  
NTIC
  	
  
 
  	
  
Henkel
  
	
  

  	
   
 	
  

  
	
  Dr. Mehmet A. Gencer
  	
  
 
  	
  
Dr. Ralf Schelbach
  
	
  
 
  	
  
 
  	
  
 
  
	
  
G. Patrick Lynch (World)
  	
  
 
  	
  
Dr. Ralf Schelbach (Business)
  
	
  
 
  	
  
 
  	
  
 
  
	
  
Gerhard Hahn (Europe)
  	
  
 
  	
  
Patrick Droniou (Henkel Technology)
  

	
   
  	
  
Once a specific subject of co-operation is established, the Parties   shall elaborate a list of projects which might be suitable for a cooperation   between Henkel, the Henkel Affiliates, NTIC and/or NTIC Joint Venture   Companies.  The Parties make their   best efforts in order to obtain approval of their respective company within   due time in order to proceed on such specific subject regarding i.e. technical   elements and human competences to be shared and reasonable financial aspects.   The steering committee shall decide on the necessary steps which have to be   taken to implement the listed projects and will establish a regional   committee in as far as it is necessary to implement a project.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
3.13
  	
  
Publicity
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.13.1
  	
  
Except as required by law or as permitted under Clause 3.13.3, the   Parties shall not, and shall procure that their respective Affiliates or   Joint Venture Companies shall not, make any public disclosure or originate   any publicity concerning the terms of the settlement between the Parties   and/or the provisions of this Agreement, the performance of this Agreement,   and any dispute and/or disagreement relating to this Agreement without the   prior written consent of the other Parties.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.13.2
  	
  
It is acknowledged by the Parties that NTIC and Henkel are public   companies and as such may be required to publicly disclose certain   events.  The Parties will, however:
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
3.13.2.1
  	
  
use their reasonable endeavours to send written notice to the other   Party (at the address set out above) of the full text of any announcement or   notification required by law as soon as reasonably possible prior to such   announcement or notification so that the other Party will have an opportunity   to comment upon such announcement or notification; and
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
3.13.2.2
  	
  
make any such announcement as factual and as brief as appropriate   under circumstances.
  

20

	
  
 
  	
  
3.13.3
  	
  
Each Party shall be entitled to issue a press release with the prior   approval of the other party
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
Unless otherwise mandated by law, this Agreement shall not form part   of any public record.
  
	
  
 
  	
  
 
  	
  
 
  
	
  3.14
  	
  
Miscellaneous Provisions
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.1
  	
  
Each Party undertakes in good faith to implement or make implemented   by its Affiliates and joint venture companies the provisions and/or necessary   or appropriate measures so that this Agreement receives full and entire   effect. To that regard, the Parties shall arrange together if a difficulty   arises concerning the preparation, the conclusion, the execution of one or   several Purchase Agreement(s) concluded under the applicable national   legislation so as the spirit and the word of the hereby Agreement is   respected.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.2
  	
  

NTIC  and  Henkel  regard  all  liabilities  or  obligations  accepted  by their
Affiliates or the NTIC Joint Venture Companies  pursuant to this Agrement or the
Purchase  Agreements as liabilities or obligations  accepted directly by NTIC or
Henkel respectively.   All such liabilities or obligations may therefore be
directly  executed or enforced  against NTIC or Henkel as the case may be. 
Hence, pursuant to the Purchase Agreement, Henkel undertakes to pay to Acobal or
NTIC all sums that Acobal paid to creditors  of HST,  with respect to duly filed
oppositions as set forth by articles L. 141-12 and following, of the French
Commercial  Code,  and are owed by HST to be reimbursed to Acobal but which have
not been  reimbursed  by HST to Acobal  within a thirty (30) day period.  Hence,
pursuant to the Purchase  Agreement,  NTIC undertakes to pay to HST or Türk
Henkel  Kimya  Sanayi  Ve  Ticaret  A.S.all  sums  due for the  transfer  of the
Business,  the Assets,  and the  Inventory  which are owed by Acobal or Fibro-NTI
Urun Gelistirme Ve Pazarlama  Ticaret Anonim but which have not been paid within
a thirty (30) day period.
 
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.3
  	
  
This Agreement may not be modified except in writing signed by duly   authorised representatives of all Parties.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.4
  	
  

Each of the Parties acknowledges that in entering into this Agreement it has not
relied on any representation, warranty or other provision except as expressly
provided in this Agreement or the Purchase Agreement(s and all conditions,
warranties or other terms implied by statute or case law are excluded to the
fullest extent permitted by law.  No Party shall have any claim against any
other in respect of any representation not expressly included in this Agreement
unless such representation was made fraudulently.
 
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.5
  	
  
Failure by any Party to enforce at any time, for any period, any one   or more of the terms or conditions of this Agreement shall not be a waiver of   them or of the right at any time subsequently to enforce all terms and   conditions of this Agreement.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.6
  	
  
Each provision of this Agreement shall be construed separately and   shall be divisible from this Agreement.    In the event that any provision or any part of any provision of this   Agreement is declared by any Court or other competent authority to be void or   unenforceable by reason of any applicable law, that provision or the relevant   part of that provision shall be deleted and the remaining provisions of this   Agreement shall continue in full force and effect.
  

21

	
  
 
  	
  
3.14.7
  	
  
Each Party shall bear the costs and fees of their own counsel   concerning the conclusion and the execution of this Agreement.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
3.14.8
  	
  
The Parties note that the confidentiality agreement attached as   Schedule 5 to this agreement was entered into between NTIC and a French   company CFPI, and that CFPI was subsequently acquired by HST, and that HST   and its employees therefore acquired an obligation of confidence to NTIC at   that time.  As that obligation of   confidence was the subject of the French Action terminated at paragraph 2.1   above, no further action shall be taken by the Parties against each other in   respect of the attached agreement.
  

* * *

	
  
4.
  	
  
General Provisions
  
	
  
 
  	
  
 
  
	
  
4.1
  	
  
This Agreement and the Purchase Agreements represent the entire   agreement between the Parties in relation to its subject matter and   supersedes all previous agreements and understandings between the Parties.
  
	
  
 
  	
  
 
  
	
  
4.2
  	
  
The Parties enter into this Agreement for the benefit of all of their   Affiliates with the intention that such Affiliates be entitled to enforce   those rights and obligations under this Agreement which affect them.
  
	
  
 
  	
  
 
  
	
  
4.3
  	
  
This Agreement – including the provisions dealing with settlement of   the French Action and the OHIM Proceedings – shall be governed by and   submitted to French law.
  
	
   
  	
  
 
  
	
  
4.4
  	
  
It is concluded in five original copies in English language.
  
	
  
 
  	
  
 
  
	
  
4.5
  	
  
In case of any dispute between the Parties and/or their Affiliates   about notably the conclusion, the validity or the execution of the hereby   provisions, it shall be finally settled under the Rules of Arbitration of the   International Chamber of Commerce – ICC by one arbitrator appointed in   accordance with the said Rules. The place of arbitration will be Paris and   the language shall be English.
  

EXECUTED by the Parties on the date set out at the beginning of this Agreement acting by their duly authorised representatives.

	
  
For Northern Technologies International Corporation
  	
  
 
  	
  
For Henkel KgaA
  
	
  
 
  	
  
 
  	
  
 
  
	
  For Excor Korrosionsforschung GmbH
  	
  
 
  	
  
For Acobal SAS
  

22

For Henkel Surface Technologies S.A.S

List of the schedules

	
  
Schedule 1
  	
  
French Action
  
	
  
 
  	
  
 
  
	
  
Schedule 2 
  	
  
Part   1          OHIM Action
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Part   2          Cancellation   Letter
  
	
  
 
  	
  
 
  
	
  Schedule 3
  	
  
conclusions de désistement d’action et d’instance
  
	
  
 
  	
  
 
  
	
  
 
  	
  
conclusions d’acceptation de désistement d’action et d’instance
  
	
  
 
  	
  
 
  
	
  
Schedule 4
  	
  
NTIC Joint   Venture Companies
  
	
  
 
  	
  
 
  
	
  
Schedule 5
  	
  
CFPI   confidentiality agreement
  

23

Schedule 1

French Action

The proceedings commenced in the Civil Court of Nanterre in France on 24 September 2002 between:

	
  (i)
  	
  
NTIC and Henkel Surface Technologies SA in relation to infringement   of Community trade mark 000396176, unfair competition, and breach of   confidentiality undertakings; and
  
	
  
 
  	
  
 
  
	
  
(ii)
  	
  
ACOBAL S.A.S and Henkel Surface Technologies SA in relation to breach   of Article L.442-6 of the French Commercial Code and unfair competition;
  

which were joined by order of the Civil Court of Nanterre on 5 May 2003 and are now pending before the Civil Court of Paris, France, 3rd Chamber, under the following number of registration: 03/10903.

24

Schedule 2

Part 1 - OHIM Action

The cancellation proceedings in respect of Community Trade Mark 000396176 commenced in the Office for the Harmonisation of the Internal Market in Alicante by Henkel.

Part 2 - Cancellation Letter

Cancellation Division
 Trade Mark Department
 Office of Harmonization of the Internal Market
 Avenida de Europa, 4
 E-03008 Alicante

Spain

Dear Sirs

Community Trade Mark Registration 396176 in the name of Northern Technologies International Corporation

Cancellation Application thereto filed by Henkel KGaA (OHIM Ref. 512C)

The Applicant and the Defendant have reached an out of court settlement on the cause of action.  The Applicant therefore withdraws definitively the above cancellation application.

HENKEL KGaA

25

Schedule 3

26

Schedule 4

NTIC Joint Venture Companies

ASEAN: NTI ASEAN LLC
 Austria: EUROMASCH Maschinen-Handels-Gesellschaft m.b.H.
Australia: EXCOR Zerust Pty Ltd.
 Brazil: Zerust Prevenção de Corrosão Ltda.
 Canada: EXCOR-ZERUST CANADA CORPORATION
 China: Tianjin ZERUST Anti-Corrosion Technologies, Ltd.
 Czech Republic and Slovak Republic : FATRA – NTI, s.r.o.
Finland: ZERUST OY
 France: ACOBAL S.A.S.
 Germany: EXCOR GmbH and Excor Korrosionsforschung GmbH
 India: Harita-NTI Ltd.

Japan: Taiyonic Ltd.
 Korea: Korea
Zerust Co., Ltd.
 Malaysia: Chong Wah - NTIA Sdn. Bhd.
 Philippines: NTIA
Zerust Philippines, Inc.
 Poland: EXCOR Sp. z o.o
 Russia:
MostNIC
Singapore: Zerust Singapore Pte. Ltd.
 Sweden: ZERUST
AB
Taiwan: ZERUST-NIC (Taiwan) Corp.
Thailand: Specialty-NTIA (Thailand)
Co., Ltd.
 Turkey: FIBRO-NTI ÜRÜN GELISTIRME VE PAZARLAMA TICARET
ANONIM SIRKETI (FIBRO-NTI A.S.)
UK: ZERUST (U.K.) LIMITED
 US: ZERUST
CONSUMER PRODUCTS, LLC

27

	
  For and on behalf of
  	
  
 
  
	
  
NORTHERN TECHNOLOGY 
  	
  
/s/ MEHMET A. GENCER
  
	
  
INTERNATIONAL CORPORATION
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Mehmet A. Gencer
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
President
  
	
  
 
  	
  
Title (Print)
  
	
   
  	
  
 
  
	
  
 
  	
  
/s/ STEPHAN TAYLOR
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Stephan Taylor
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Director
  
	
  
 
  	
  
Title (Print)
  
	
  
 
  	
  
 
  
	
   
  	
  
/s/ GERHARD HAHN
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Gerhard Hahn
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Vice President
  
	
  
 
  	
  
Title (Print)
  
	
  
 
  	
  
 
  
	
  
For and on behalf of
  	
  
 
  
	
  Excor Korrosionsforschung GmbH
  	
  
/s/ GERHARD HAHN
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Gerhard Hahn
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
GR
  
	
  
 
  	
  
Title (Print)
  

28

	
  For and on behalf of Fibro-NTI Urun 
  	
  
/s/ MEHMET A. GENCER
  
	
  
Gelistirme Ve Pazarlama    Ticaret Anonim
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Mehmet A. Gencer
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Chairman
  
	
  
 
  	
  
Title (Print)
  
	
  
 
  	
  
 
  
	
  For and on behalf of
  	
  
 
  
	
  
ACOBAL SAS
  	
  
/s/ JACQUES MANENCAND
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Jacques Manencand
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
President
  
	
  
 
  	
  
Title (Print)
  
	
  
 
  	
  
 
  
	
  For and on behalf of
  	
  
 
  
	
  
HENKEL KgaA
  	
  
/s/ DR. BORIS   TASCHE
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Dr. Boris Tasche
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Vice President
  
	
  
 
  	
  
Title (Print)
  
	
   
  	
  
 
  
	
  
 
  	
  
 
  
	
  
For and on behalf of Henkel Surface Technologies S.A.S.
  	
  
/s/ DR. BORIS   TASCHE
  
	
  
 
  	
  

  
	
  
 
  	
  
Signature
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Dr. Boris Tasche
  
	
  
 
  	
  
Name (Print)
  
	
  
 
  	
  
 
  
	
  
 
  	
  
Vice President
  
	
   
  	
  Title (Print)
  

29Exhibit 10.6

PURCHASE AGREEMENT

          THIS AGREEMENT is made as of June 24, 2005 (the “Effective Date”), between Circle Pines Mainstreet II, LLC, a Minnesota limited liability company (“Seller”), and Northern Technologies International Corporation, a Minnesota corporation (“Buyer”).

          In consideration of this Agreement, Seller and Buyer agree as follows:

          1.  Sale of Property.  Seller agrees to sell and convey unto Buyer, and Buyer agrees to purchase and accept from Seller, for the price and subject to the terms, covenants, conditions, and provisions herein set forth, the following (collectively referred to herein as the “Property”):

	
  
 
  	
  
(a)
  	
  
All of that   land located at 22 Village Parkway in Circle Pines, Minnesota to be replatted   prior to Closing to be legally described on Exhibit A attached hereto   and incorporated herein and depicted on the preliminary plat attached hereto   as Exhibit A-1 and incorporated herein (the “Land”), together with all   improvements thereon including a 41,374 square foot building (the   “Improvements”), subject to an access easement to be located along the   western boundary of the Land (the “Access Easement”).
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
All right,   title, and interest, if any, of Seller, in and to (i) any land lying in the   bed of any street, road, or access way, opened or proposed, in front of, at a   side of, or adjoining the Land or the Improvements to the centerline thereof;   (ii) all reversions, remainders, appurtenances, licenses, tenements and   hereditaments appertaining to, or otherwise benefiting or used in the   operation of the Land or the Improvements; and (iii) all minerals, oil or   gas, air rights, and any and all water, water rights or similar rights or   privileges (including tap rights) appurtenant to or used in connection with   the ownership or operation of the Land or the Improvements (the “Property   Rights”);
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
To the   extent assignable, Seller’s interest, if any, in all guaranties, warranties   and other intangible property related to the Land and the Improvements (the   “Intangible Property”).
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
(d)
  	
  
To the   extent assignable, Seller’s interest, if any, in all licenses and   governmental permits related to the Land and the Improvements (the “Permits   and Licenses”).
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
All existing   fixtures in the Improvements, including, without limitation, the heating,   plumbing, electrical, air conditioning and ventilation systems (the   “Fixtures”);
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(f)
  	
  
To the   extent in Seller’s possession, all records of Seller used or useful in   connection with the operation of the Land and Improvements, including without   limitation, all records regarding management and leasing, real estate taxes   and assessments, insurance, tenants, maintenance, repairs, capital   improvements and services (the “Records”); and
  

	
  
 
  	
  
(g)
  	
  
To the extent   in Seller’s possession, all site and building plans, specifications and   construction contracts prepared in connection with the Improvements and the   Fixtures (the “Plans and Construction Contracts”).
  

          2.  Purchase Price and Manner of Payment.  The total purchase price for the Property (the “Purchase Price”) is One Million Five Hundred Thousand and no/100 Dollars ($1,500,000.00).  Buyer shall pay the Purchase Price to Seller as follows:

	
  
 
  	
  
(a)
  	
  
$50,000.00   as earnest money (the “Earnest Money”) paid within five (5) days after the   full execution of this Agreement to First American Title Insurance Company   (the “Title Company”), the sufficiency of which Seller hereby acknowledges.   The Title Company shall invest the Earnest Money in an interest-bearing   account approved by Buyer. All interest accrued or earned thereon shall be   added to and included in the amount of the Earnest Money.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
The   remaining balance of the Purchase Price by wire transfer to the Title Company   for the benefit of Seller on the Closing Date (the “Closing Payment”).
  

          Buyer shall be entitled to fund the Earnest Money with a letter of credit; provided, however, the letter of credit must be unconditional and irrevocable and issued by a recognized financial institution acceptable to Seller.  At Buyer’s option, at Closing the Earnest Money may be returned by the Title Company to Buyer and Buyer will wire transfer to the Title Company the entire Purchase Price.  If this Agreement is terminated after the Contingency Date, Buyer authorizes the Title Company to draw upon the letter of credit and/or pay such sums to Seller subject to the terms of this Agreement.

          3.  Due Diligence Documents.  Seller agrees within thirty (30) days of the Effective Date, to furnish to Buyer for Buyer’s review and approval true and correct copies of the following items, if any, in its possession (the “Due Diligence Documents”):

	
  
 
  	
  
(a)
  	
  
The Permits   and Licenses.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
The Records.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Plans and   Construction Contracts.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
Any   Environmental Site Assessment and any other soil, geotechnical or   environmental reports on the Property in the possession of Seller.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Any   guaranties and warranties with respect to the Property in the possession of   Seller.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(f)
  	
  
Any engineering   and other professional reports for the Property or relating to the condition   of the Property in the possession of Seller.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(g)
  	
  
The written   lease agreement and all amendments thereto and extensions thereof, for the   Property by and between AGS Publishing, Inc., as tenant, and Seller, as   landlord (the “AGS Lease”).
  

2

          4.  Title and Survey.  

	
  
 
  	
  
(a)
  	
  
Survey.  Within thirty (30) days of the Effective   Date, Seller shall, at its sole cost, obtain an ALTA/ACSM Land Title Survey   (the “Survey”) certified to Buyer and the Title Company dated within one (1)   year of the Closing. (the “Survey”).
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
Title   Evidence.    Within thirty (30) days of the Effective Date, Seller shall, at its   sole cost and expense, deliver to Buyer a commitment (the “Commitment”) for a   1992 ALTA Owner’s Policy of Title Insurance in favor of Buyer in the amount   of the Purchase Price and a copy of all exceptions and documents referenced   therein.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Buyer’s   Objections.    Buyer shall have fifteen (15) days after the later of receipt of the   Commitment or the Survey within which to examine same (the “Title/Survey   Review Period”).  Buyer shall, no   later than the expiration of the Title/Survey Review Period, notify Seller in   writing of any defect(s) (the “Objections”), provided that if Buyer fails to   give Seller written notice of the Objections before the expiration of the   Title/Survey Review Period, the matters shown in the Commitment and on the   Survey shall be deemed to be waived as objections and be deemed “Permitted   Exceptions”.  Seller will have thirty   (30) days after receipt of the Objections to cure the Objections, during   which period the Closing shall be postponed if necessary.  Seller agrees to remove by payment,   bonding, or otherwise, any lien or encumbrance in a liquidated amount against   the Property which was
created by Seller and which is removable by the   payment of money or the posting of a bond.    Seller shall remove any other defect provided that Seller shall not be   required to cure any other defect(s) to the extent that the cost of curing   such defect(s) exceeds, in the aggregate, Five Thousand and 00/100 Dollars   ($5,000.00).  If the Objections are   not cured within said thirty (30) day period, Buyer shall have the option to:
  

	
  
 
  	
  
 
  	
  
(1)
  	
  
Terminate   this Agreement by notice in writing to Seller and receive a refund of the   Earnest Money and all interest earned thereon; or
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(2)
  	
  
Waive the   Objections and proceed to the Closing.
  

	
   
  	
  
(d)
  	
  
Update of   Commitment.    From time to time after obtaining the Commitment but at or prior to   Closing, Buyer may, at its expense, update the effective date of the   Commitment for the Property and give an Objection notice to Seller as to   Objections which were not reflected in the previous Commitment (the “Subsequent   Title Defects”).  With respect to Subsequent Title Defects, Buyer and   Seller shall have the same rights and obligations as set forth in   subparagraph (c) above.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Conveyancing.  Marketable, insurable, fee simple title to   the Land, Improvements and Fixtures shall be conveyed via Warranty Deed at   Closing, subject only to the Permitted Exceptions, and to the Property Rights   via a Quit Claim Deed at Closing, subject only to the Permitted Exceptions.
  

3

	
  
 
  	
  
(f)
  	
  
Future   Encumbrances. Except for the Access Easement and the   replat of the Land, from and after the Effective Date, Seller will not   voluntarily place or permit to arise on the Property any easement,   restriction, condition, covenant, lien or encumbrance which will not be   removed at or prior to Closing, provided, however, that this shall not   prohibit any action required to be taken by Seller by any governmental action   or order.  Prior to recording, Seller   shall obtain Buyer’s prior written approval of the final plat of the Land and   the Access Easement, provided, however, Buyer’s approval shall not be   unreasonably withheld, conditioned or delayed.
  

          5.  Inspection Period.  Buyer shall have ninety (90) days following the Effective Date (the “Inspection Period”), to make such physical, zoning, soil tests, engineering inspections, hazardous waste and environmental reviews, wetland delineations, business feasibility reviews of the Property and such other tests, studies and investigations of the Property as Buyer, in Buyer’s sole discretion, deems necessary to make (the “Tests”) and to review the Due Diligence Documents.  Seller shall make the Property available to Buyer and its agents, consultants and engineers for such examinations, inspections and investigations as Buyer deems appropriate, provided that Buyer shall obtain Seller’s written consent, which shall not be unreasonably withheld, to any proposed tests of any invasive nature or which could damage the Property. 
Buyer shall bear the cost of all inspections and tests.  

All information provided by Seller to Buyer relating to the Property in the course of its review shall be treated as confidential information by Buyer, its employees, agents, representatives and contractors.  Buyer shall be liable for all costs and expenses, and/or damages or injuries to any person or property resulting from any such inspection or failure to keep all such information confidential.

          6.  Inspection Obligations.  Buyer and its agents and representatives shall:

	
  
 
  	
  
(a)
  	
  
Repair any   damage to the Property caused by Buyer’s investigation and shall return the   Property to substantially the same condition as existed prior to such entry.;
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
Promptly pay   when due the costs of all Tests, investigations, and examinations done with   regard to the Property and with Buyer’s authorization;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Not permit   any liens to attach to the Property by reason of the exercise of its rights   hereunder;
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
Indemnify   and hold harmless Seller against all claims, demands, losses, costs, damages   and expenses including property damage, bodily injury (including death) and   reasonable attorneys’ fees arising out of any activities conducted by Buyer   or Buyer’s agents, employees or contractors on the Property; and
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Not   unreasonably interfere with the business operations of the tenant, AGS   Publishing, on the Property.
  

4

          7.  Contingencies.  The obligations of Buyer under this Agreement are contingent upon each of the following (the “Contingencies”):

	
  
 
  	
  
(a)
  	
  
Title.  Title to the Property shall have been   found acceptable, or been made acceptable, in accordance with the   requirements and terms of Section 4.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
Testing.  Buyer shall have determined that it is   satisfied with the results of and matters disclosed by the Tests on or before   the termination of the Inspection Period.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Due   Diligence Document Review.  Buyer shall have determined, on or before the Contingency Date,   that it is satisfied with its review and analysis of the Due Diligence   Documents.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
Government   Approvals.    Buyer shall have obtained at its sole cost and expense, on or before   the Contingency Date, as defined below, all final governmental approvals   necessary in Buyer’s judgment in order to make use of the Property as Buyer   intends including but not limited to use of the Property for light   manufacturing and processing.  Seller   shall, without charge to Buyer, cooperate in Buyer’s attempts to obtain all   such governmental approvals.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Building   Separation.    Buyer shall be satisfied with the cost and obligations associated with   performing the work required to separate the buildings pursuant to Section 20   below.
  

          If any of the Contingencies have not been satisfied, as determined by Buyer in Buyer’s sole discretion, on or before the date that is ninety (90) days after the Effective Date (the “Contingency Date”), then this Agreement may be terminated, at Buyer’s option, by written notice from Buyer to Seller delivered on or before the Contingency Date and thereupon the Earnest Money and any interest earned thereon, shall be immediately paid to Buyer and upon such return, neither party will have any further rights or obligations to the other regarding this Agreement or the Property, except Buyer’s obligations under Section 6 shall survive such termination.  After the expiration of the Contingency Date, the Earnest Money shall be non-refundable and deemed earned by Seller.

          8.  Seller’s Representations and Warranties.  Seller represents and warrants to Buyer as follows:

	
  
 
  	
  
(a)
  	
  
Seller is a   limited liability company duly organized, validly existing and in good   standing under the laws of the State of Minnesota and is duly qualified and   authorized to own property and do business in the State of Minnesota.  Seller has full power and authority to   enter into this Agreement and to perform all its obligations hereunder.  This Agreement has been duly authorized   and executed by Seller and is binding on Seller and enforceable against   Seller in accordance with its terms, except as enforceability may be limited   by equitable principles or by the laws of bankruptcy, insolvency, or other   laws affecting creditor’s rights generally.    No consent of any other person or entity to such execution, delivery,   and performance is required.
  

5

	
  
 
  	
  
(b)
  	
  
Seller is   not a “foreign person” within the meaning of the United States tax laws and   to which reference is made in Internal Revenue Code Section 1445(b)(2).  At Closing, Seller shall deliver to Buyer   a certificate to such effect.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Seller has   not received written notice of violations from any municipal, county,   federal, or state governmental agency with regard to violations of any rules,   ordinances, orders, requirements, or regulations imposed on or affecting the   Property.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
Seller has   not received written notice of any pending or threatened condemnation,   eminent domain, zoning, environmental or other land use proceedings with   respect to the Property.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Neither the   execution or delivery of this Agreement nor the consummation of the   transactions contemplated herein will conflict with or result in a breach of   any agreement to which Seller is a party or by which any of its property is   bound, or constitute a default thereunder.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(f)
  	
  
As of the   Effective Date, there are special assessments filed against the Property.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(g)
  	
  
Seller has   not received written notice from a governmental authority that the Property   is in violation of any requirement of any laws and regulations, including   without limitation, the Americans with Disabilities Act and the regulations   and Accessibility Guidelines for Buildings and Facilities issued pursuant   thereto.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(h)
  	
  
Seller has   not received any written notice of proceedings relating to the revocation or   modification of any licenses, certificates of occupancy, permits, consent   orders, authorizations or other approvals (collectively the “Licenses”)   required for the ownership, use or operation of the Property which would have   an adverse effect on the Property.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(i)
  	
  
Seller has   not received any written notice or notice of filing of any violation of any   restriction, condition, covenant or agreement concerning the Property or the   use thereof contained in any instrument of record or in any federal, state,   municipal or governmental permit, rule or regulation applicable to the   Property.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(j)
  	
  
As of the   Effective Date hereof, there is not now pending nor has Seller received   written notice of a threat of any action, suit or proceeding against or   affecting Seller or the Property before or by any federal or state court,   commission, regulatory body, administrative agency or other governmental   body, domestic or foreign, wherein an unfavorable ruling, decision or   finding, upon consummation of the sale contemplated hereby to Buyer may   reasonably be expected to have a material adverse effect on the business of   or on the condition or operations of the Property, or would interfere with   Seller’s ability to consummate the transactions contemplated by this   Agreement.
  

6

	
  
 
  	
  
(k)
  	
  
Seller has   not used, generated, processed, stored, released, discharged, transported,   handled or disposed of any Hazardous Materials, as hereafter defined, on the   Property except for such storage and use by Seller incidental to the   construction and operation of the Property as a office/warehouse building,   which was in compliance with Hazardous Waste Laws, as hereafter defined.  To the best of Seller’s knowledge, there   are no Hazardous Materials on the Property in violation of any Hazardous   Waste Laws. Seller has not received any notice of any violation of any   Hazardous Waste Law with respect to the Property.  For purposes herein “Hazardous Materials” means any substance,   chemical, waste or material that is or becomes regulated by any federal,   state or local governmental authority because of its toxicity,   infectiousness, radioactivity, explosiveness, ignitability, corrosiveness or   reactivity, including, without
limitation, those substances regulated by the   Hazardous Waste Laws.  For purposes   herein “Hazardous Waste Laws” means the Comprehensive Environmental Response,   Compensation, and Liability Act of 1980 (“CERCLA”), the Superfund Amendments   and Reauthorization Act of 1986 (“SARA”), the Resource Conservation and   Recovery Act (“RCRA”), the Toxic Substances Control Act (the “TSCA”), as such   acts may be amended from time to time, or any other federal or state   statutory or regulatory cause of action arising from or related to Hazardous   Materials at, in or under the Property.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(l)
  	
  
All items,   including but not limited to Due Diligence Documents, delivered by Seller to   Buyer are, to the best of Seller’s knowledge based solely on reliance on   others, and shall be true, correct and accurate copies, in all material   respects, of what they purport to be, otherwise unamended and unaltered.
  

All representations and warranties made herein shall be reaffirmed at Closing to be effective as of that date.  Seller agrees to immediately notify Buyer upon discovery by Seller that any of the above representations and warranties are materially incomplete or untrue.  Upon discovery by Buyer prior to the expiration of the Contingency Period that a fact or matter represented or warranted as of the Effective Date is no longer true (whether or not actually known by Seller), Buyer may terminate this Agreement in the manner set forth in Section 7 above. All such representations and warranties shall survive Closing for a period of six (6) months after Closing and shall not be merged in the execution and delivery of the deed and other documents of conveyance executed hereunder notwithstanding the lack of reference in said deed and documents of conveyance to the representations and warranties described herein. Seller shall furnish a certificate on the date of
Closing recertifying as to the accuracy of the representations and warranties contained herein as of the date of Closing.

Upon discovery by Seller after the termination of the Contingency Period but prior to or on the Closing date that a representation or warranty is materially untrue or that a fact or matter represented or warranted as of the Effective Date is no longer true (whether or not actually known by Seller), Buyer at its option shall have the right to: (i) receive the return of the Earnest Money, together with all interest earned thereon, and reimbursement of actual out-of-pocket costs incurred in connection with Buyer’s inspection in an amount not to exceed Twenty-Five Thousand and 00/100 Dollars ($25,000.00), whereupon this Agreement shall terminate and the parties shall be released from all further obligations hereunder, except for Buyer’s obligations 

7

under Section 6, which shall survive such termination, or (ii) elect to purchase the Property notwithstanding the existence of such untrue representation or warranty without any adjustment of the Purchase Price.  In the event the Buyer elects to proceed with the purchase of the Property, it shall take subject to such untrue representation or warranty, and Buyer shall be deemed to have waived any claim with respect to such untrue representation or warranty.  Upon discovery by Buyer after the Closing date that a representation or warranty is untrue, when given or updated or at Closing, Seller hereby agrees to indemnify and hold Buyer harmless from and against and to reimburse Buyer with respect to any and all claims, demands, causes of action, loss, damage, liabilities and costs (including reasonable attorneys’ fees and court costs) asserted against or incurred by Buyer by reason of or arising out of or resulting from the breach of any representation
or warranty as set forth herein, provided such indemnification shall only extend to claims made in writing within twelve (12) months following the date of Closing and to actual damages and shall not include consequential damages.

          9.  Buyer’s Representations.  Buyer represents and warrants to Seller as follows:

	
  
 
  	
  
(a)
  	
  
Buyer is a   corporation duly organized, validly existing and in good standing under the   laws of the State of Minnesota and is duly qualified and authorized to own property   and do business in the State of Minnesota.    Buyer has full power and authority to enter into this Agreement and to   perform all its obligations hereunder.    This Agreement has been duly authorized and executed by Buyer and is   binding on Buyer and enforceable against Buyer in accordance with its terms,   except as enforceability may be limited by equitable principles or by the   laws of bankruptcy, insolvency, or other laws affecting creditor’s rights   generally.  No consent of any other   person or entity to such execution, delivery, and performance is required.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
Neither the   execution or delivery of this Agreement nor the consummation of the   transactions contemplated herein will conflict with or result in a breach of   any contract, license, or undertaking to which Buyer is a party or by which   any of its property is bound, or constitute a default thereunder or result in   the creation of any lien or encumbrance upon the Property.
  

The above representations and warranties shall survive Closing for a period of six (6) months after Closing, and shall not be merged in the execution and delivery of the deed and other documents of conveyance executed hereunder notwithstanding the lack of reference in said deed and documents of conveyance to the representations and warranties described herein and shall not be affected by any investigation, verification or approval by any party hereto or by anyone on behalf of any party hereto.

          10.  Operation Prior to Closing.  During the period from the Effective Date to the Closing Date, Seller shall operate and maintain the Property in the ordinary course of business in accordance with prudent, reasonable business standards, including the maintenance of adequate casualty and liability insurance. During this period, Seller shall continue to make necessary repairs to the Property in the ordinary course of business.  The Property shall be in substantially the same condition on the date of conveyance to Seller as existed on the Effective Date of this Agreement, reasonable wear and tear, or damage caused by casualty or the Seller, excepted. 

8

          11.  Future Contracts.  After the Effective Date, unless the contract will be terminated prior to the Closing, Seller shall not enter into any contract which would affect the Property without Buyer’s prior written consent, which shall not be unreasonably withheld or delayed.  In any case where the Buyer’s consent is required hereunder, Buyer shall be given ten (10) days to review the proposed contract.  If Buyer fails to deliver to Seller Buyer’s objection in writing to such contract within ten (10) days after written request therefor is delivered to Buyer, Seller may execute the document for which the consent is requested and Buyer shall be deemed to have approved same.  Seller will provide a copy of the fully executed contract to Buyer upon execution of any such new contract by Seller and a third party contractor. 

          12.  Structural Changes to Improvements.  Subject to the rights of AGS under the AGS Lease, from and after the Effective Date, Seller shall not make or authorize any structural changes to the Improvements or other changes of a material nature prior to Closing without Buyer’s consent unless such changes are required as a result of an emergency in which Seller is not able to notify Buyer prior to the necessity of making such changes.  Buyer’s consent shall not be unreasonably withheld or delayed.  Notice shall be given to Buyer as soon as reasonably possible in connection with structural changes made as a result of an emergency.

          13.  Damage.  If, prior to the Closing, all or any part of the Property is substantially damaged by fire, casualty, the elements or any other cause, Seller shall immediately give notice to Buyer of such fact and at Buyer’s option (to be exercised within ten (10) days after Seller’s notice), this Agreement shall terminate, in which event neither party will have any further obligations under this Agreement, except Buyer’s obligations under Section 6 shall survive such termination.  If Buyer fails to elect to terminate despite such damages, or if the Property is damaged, but not substantially, Seller shall assign to Buyer all right to receive the proceeds of all insurance related to such damage and the Purchase Price shall remain the same.  For purposes of this Section, the words “substantially damaged” mean damage that would cost
Fifty Thousand and no/100 Dollars ($50,000.00) or more to repair.

          14.  Condemnation.  If, prior to the Closing Date, (i) eminent domain proceedings are commenced against all or any part of the Property or (ii) any permanent material change, limitation or restrictions to the access to and from the Property and abutting public streets or any permanent material change in the existing traffic patterns in abutting streets, such as modifications, addition or elimination of medians and turn lanes occurs prior to Closing, Seller shall immediately give notice to Buyer of such fact and at Buyer’s option (to be exercised within thirty (30) days after Seller’s notice), this Agreement shall terminate, in which event neither party will have further obligations under this Agreement (except Buyer’s obligations under Section 6 shall survive such termination) and the Earnest Money, and interest accrued thereon, shall be refunded
to Buyer.  If Buyer shall fail to give such notice, there shall be no reduction in the Purchase Price, and Seller shall assign to Buyer at the Closing Date all of Seller’s right, title and interest in and to any award made or to be made in the condemnation proceedings.  Prior to the Closing Date, Seller shall not designate counsel, appear in, or otherwise act with respect to the condemnation proceedings without Buyer’s prior written consent.

9

          15.  Default Provisions.

	
  
 
  	
  
(a)
  	
  
In the event   of a default by Buyer under this Agreement resulting from Buyer’s failure to   close in accordance with the terms and provisions of this Agreement, without   default on Seller’s part, Seller shall receive the Earnest Money, together   with all interest earned thereon, as Seller’s sole and exclusive remedy and   as agreed and liquidated damages, whereupon the parties shall be relieved of   all further obligations hereunder except Buyer’s obligations under Section 6 hereof,   which shall survive termination, in lieu of all other remedies available to   the Seller at law or in equity for such default.  Buyer and Seller acknowledge and agree that, in such event,   actual damages are difficult or impossible to ascertain and the Earnest   Money, together with all interest earned thereon, is a fair and reasonable   estimation of the damages of Seller.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
Recognizing   that Seller will suffer irreparable injury from Buyer’s refusal or failure to   buy the Property to Seller, Seller may also elect the remedy of specific   performance; provided, however, such action must be commenced within six (6)   months of the Buyer’s default.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
In the event   of a default by Seller under this Agreement, without any default of Buyer,   Buyer at its option shall have the right to receive the return of the Earnest   Money together with all interest earned thereon and reimbursement of actual   out-of-pocket costs incurred in connection with Buyer’s inspection in an   amount not to exceed Twenty-Five Thousand and 00/100 Dollars ($25,000.00),   whereupon this Agreement shall terminate and the parties shall be released   from all further obligations hereunder except Buyer’s obligations under   Section 6 hereof, which shall survive termination, in lieu of all other remedies   available to the Buyer at law or in equity for such default.  Buyer and Seller acknowledge and agree   that, in such event, actual damages are difficult or impossible to ascertain   and the Earnest Money, together with all interest earned thereon, is a fair and   reasonable estimation of the damages of Buyer.

	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
Recognizing   that Buyer will suffer irreparable injury from Seller’s refusal or failure to   sell the Property to Buyer, Buyer may also elect the remedy of specific   performance; provided, however, such action must be commenced within six (6)   months of the Seller’s default.
  

          16.  Conditions of Closing.  The Buyer shall have no obligation to close the purchase of the Property and may terminate this Agreement and have the Earnest Money paid to it unless the following conditions (“Closing Conditions”) are met as of the time of Closing or the Buyer, in its discretion, shall have waived any of such conditions:

	
  
 
  	
  
(a)
  	
  
All   covenants and obligations of the Seller under this Agreement to be performed   at or prior to Closing shall have been performed.
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
(b)
  	
  
Subject to   the terms of Sections 12 and 13, the Property shall be in substantially the   same condition at the Closing as existed on the Effective Date, reasonable   wear and tear or damage caused by casualty or the Buyer excepted, and no   material adverse change shall have occurred with respect to the operation of   the Property after the end of the Inspection Period.
  

10

	
  
 
  	
  
(c)
  	
  
All of the   representations and warranties herein shall be true and correct in all   material respects at Closing.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
There shall   not have been instituted and be pending any litigation: (i) alleging   that the Property may not be used for office, warehouse and light   manufacturing and processing use; (ii) subject to Section 13, alleging   material defects (defects which cost more than $50,000.00 to fix) in the   physical condition of the Improvements; (iii) that would impair Seller’s   right to sell the Property in accordance with the terms of this Agreement; or   (iv) that would, if successful, impose a lien or other encumbrance on the   Property which cannot be or is not removed by Seller by payment, bonding or   otherwise as set forth in Section 4(c).
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
There shall   be no outstanding notices of a material violation with respect to Seller’s   operation or ownership of the Property thereof from any governmental   authority.
  

          17.  Closing.  The closing of the purchase and sale contemplated by this Agreement (the “Closing”) shall occur on the earlier of (a) the termination date of the AGS Lease, or (b) May 1, 2006 (the “Closing Date”).  The Closing shall take place at 10:00 a.m. local time at the office of the Title Company.  Seller shall deliver possession of the Property to Buyer on the Closing Date.

	
  
 
	
  
(a)
	
  
Seller’s   Closing Documents.    On the Closing Date, Seller shall execute and/or deliver to Buyer the   following:
  

	
   
  	
  
 
  	
  
(1)
  	
  
A Warranty   Deed conveying Seller’s interest in the Land, Improvements and Fixtures to   Buyer subject only to the Permitted Exceptions.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(2)
  	
  
Quitclaim   Deed conveying the Property Rights subject only to the Permitted Exceptions.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(3)
  	
  
An   Assignment of Intangibles (“Assignment of Intangibles”) for all other   Property included in this transaction, including Intangibles, Records, Permits   and Licenses, and Plans and Construction Contracts.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(4)
  	
  
If   applicable, the Well and Storage Tank Disclosures and Certificates   disclosures required under Minnesota Statute §103I.005, Subd. 21 (for wells)   and Minnesota Statute §116.48, Subd. 6 (for storage tanks).
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(5)
  	
  
An Affidavit   of Seller indicating that on the Closing Date there are no outstanding,   unsatisfied judgments, tax liens or bankruptcies against or involving Seller   or the Property; that there has been no skill, labor or material furnished to   the Property at Seller’s request 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.
  

11

	
  
 
  	
  
 
  	
  
(6)
  	
  
A   “non-foreign” affidavit or certificate pursuant to Internal Revenue Code   Section 1445.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(7)
  	
  
A   certificate as to the continuing validity of the Seller’s representations and   warranties as of the date of Closing as described in Section 8 hereof.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(8)
  	
  
A closing   statement.
  
	
   
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(9)
  	
  
Evidence of   payment to the Broker.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(10)
  	
  
Keys to all   locks and security passcodes for all security systems on the Property.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(11)
  	
  
All other   documents reasonably determined by the Title Company to be necessary to   transfer the fee interest in the Property to Buyer in the manner specified   herein.
  

	
  
 
  	
  
(b)
  	
  
Buyer’s   Closing Documents.    On the Closing Date, Buyer shall execute and/or deliver to Seller the   following:
  

	
  
 
  	
  
 
  	
  
(1)
  	
  
The Closing   Payment (or the Purchase Price if the Earnest Money is returned to Buyer   pursuant to Section 2), by wire transfer of U.S. Federal Funds, to be   received in the Title Company’s trust account, for delivery to Seller, on the   Closing Date.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
(2)
  	
  
Assignment   of Intangibles.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(3)
  	
  
A closing   statement.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
(4)
  	
  
A   certificate as to the continuing validity of the Buyer’s representations and   warranties as of the date of Closing as described in Section 9 hereof.
  
	
  
 
  	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
(5)
  	
  
Such   Affidavit of Buyer, Certificate of Real Estate Value or other documents as   may be reasonably required by the Title Company in order to record the   Warranty Deed.
  

          18.  Prorations and Allocations.  Seller and Buyer agree to the following prorations and allocation of costs regarding this Agreement which prorations and allocations shall be based upon the actual number of days of ownership of the Property with Buyer owning the Property as of the date of Closing:

	
  
 
  	
  
(a)
  	
  
Title,   Survey and Closing Fee.  Seller shall pay all costs of the Commitment.  Buyer shall pay all premiums required for   the issuance of any owner’s or lender’s title policy issued pursuant to the   Commitment.  Seller shall pay all   costs of the Survey.  Seller and Buyer   shall share equally the Title Company’s closing fee or charge.
  

12

	
   
  	
  
(b)
  	
  
Real Estate   Taxes and Special Assessments.  General real estate taxes and installments   of special assessments payable therewith (collectively “Taxes”) due and   payable in the year prior to the year in which the Closing Date occurs and   all prior years shall be paid by Seller.    Taxes due and payable in the year in which the Closing Date occurs   shall be prorated between Seller and Buyer as of the Closing Date.  Buyer shall pay the Taxes due and payable   in the year subsequent to the year in which the Closing Date occurs and   thereafter.  Seller shall pay all   special assessments levied, pending or ordered against the Property which are   not certified for payment as installments as of the Closing Date.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
Recording   Costs.    Seller will pay the cost of recording all documents necessary to place   record title in the condition warranted and represented by Seller in this   Agreement and the cost of recording the Warranty Deed, including the   applicable state deed tax.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
Attorneys’   Fees.  Each   of the parties will pay its own attorneys’ fees, except that a party   defaulting under this Agreement or any closing document will pay the   reasonable attorneys’ fees and court costs incurred by the non-defaulting   party to enforce its rights regarding such default.
  

          19.  Broker’s Commission.  Seller has been represented by Colliers Turley Martin Tucker.  Seller and Buyer represent and warrant to each other that they have dealt with no other brokers, finders or the like in connection with this transaction, and agree to indemnify each other and to hold each other harmless against all other claims, damages, costs or expenses of or for any fees or commissions resulting from their separate actions or agreements regarding the execution or performance of this Agreement, and will pay all costs of defending any action or lawsuit brought to recover any such fees or commissions incurred by the other party, including reasonable attorneys’ fees.  Seller shall pay any commission of Colliers Turley Martin Tucker at Closing.

          20.  Building Separation.  The Buyer acknowledges that the Property is currently connected to a building located at 4201 Woodland Road, Circle Pines, Minnesota, via an aboveground tunnel.  The Buyer, as a material condition of this Agreement, agrees within sixty (60) days after Closing, at its sole expense, to demolish the tunnel, separate the buildings, repair any damage caused by such actions, reconstruct the tunnel openings to create appropriate barrier walls on both buildings, and establish independent building systems as necessary for both buildings, including but not limited to electrical and sprinkler systems (collectively the “Separation Work”).  If Buyer fails to complete the Separation Work within ninety (90) days following Closing, Seller, after providing Buyer with ten (10) days prior written notice, may perform such work.  If
applicable, Buyer agrees to pay costs and expenses of the Separation Work incurred by Seller upon demand.

          21.  Termination of AGS Lease.  As of the Effective Date, the Property is leased to AGS pursuant to the AGS Lease.  The AGS Lease is scheduled to expire on April 30, 2006.  Seller will use its best efforts to cause AGS to timely vacate the Property and remove all of the personal property belonging to AGS from the Property prior to the Closing Date.  If AGS fails to vacate the Property on or before the Closing Date, the Closing will be postponed until such time as AGS has fully vacated the Property. 

13

          22.  Notice to Utilities.  Seller shall notify all utility companies of this sale and shall arrange for change-over of responsibility for utilities as of the date of Closing.

          23.  1031 Exchange.  Seller acknowledges that Buyer may acquire the Property as “Replacement Property” in a tax deferred exchange (an “Exchange”) within the meaning of Section 1031 of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder (the “Code”).  Buyer expressly reserves the right to assign its rights, but not its obligations, under this Agreement to a “Qualified Intermediary” as provided under the Code or otherwise engage in an Exchange with respect to the Property in a manner allowed by the Code. Seller shall reasonably cooperate with Buyer to complete the Exchange if so elected by Buyer, provided Seller shall not be required to incur additional or material liabilities, expenses or obligations with respect to any such Exchange, nor shall the Closing be delayed, postponed or
conditioned on the completion of any such Exchange.

          24.  Notices.  Any notices required or permitted to be given hereunder shall be in writing and shall be effective (i) when delivered personally, (ii) when received by overnight courier service or facsimile communications (provided that a copy of such notice is deposited in the United States mail within one (1) business day of the facsimile transmission) or (iii) three (3) days after being deposited in the United States Mail (sent certified or registered, return receipt requested), in each case addressed as follows (or to such other address as the parties hereto may designate in the manner set forth herein):

	
   
  	
  
If to   Seller:
  	
  
Northern   Technologies International Corporation
  
	
  
 
  	
  
 
  	
  
6680 North   Highway 49
   Lino Lakes, Minnesota 55014
   Attn:  Matthew Wolsfeld
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
With Copy   to:
  	
  
Elizabeth   Sheehan
   Oppenheimer Wolff & Donnelly LLP
   45 South Seventh Street, Suite 3300
   Minneapolis, Minnesota 55402
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
If to Buyer:
  	
  
Circle Pines   Mainstreet II, LLC
   c/o The Beard Group, Inc.
   750 – 2nd Street NE, Suite 100
   Hopkins, Minnesota 55343
   Attn:  Bill Beard
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
With Copy   to:
  	
  
Laura L.   Krenz
   Lindquist & Vennum PLLP
   4200 IDS Center
   80 S. 8th Street
   Minneapolis, Minnesota 55402
  

14

          25.  Miscellaneous.

	
  
 
  	
  
(a)
  	
  
In the event   any term or provision of this Agreement be determined by appropriate judicial   authority to be illegal or otherwise invalid, such provision shall be given   its nearest legal meaning which will carry out the intended meaning of this   Agreement, and the remainder of this Agreement shall be construed to be in   full force and effect.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(b)
  	
  
In the event   of any litigation between the parties under this Agreement, the prevailing   party shall be entitled to reasonable attorneys’ fees and court costs at all   trial and appellate levels.
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
(c)
  	
  
In   construing this Agreement, the singular shall be held to include the plural,   the plural shall be held to include the singular, the use of any gender shall   be held to include every other and all genders, and captions and paragraph   headings shall be disregarded.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(d)
  	
  
All of the   exhibits attached to this Agreement are incorporated in, and made a part of,   this Agreement.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(e)
  	
  
Time shall   be of the essence for each and every provision of this Agreement.
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
(f)
  	
  
Buyer, at   the option of Buyer, may waive any right conferred upon the Buyer by this   Agreement.  Except as otherwise   provided herein, such waiver may be made by, and only by, giving Seller   written notice specifically describing the right waived.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(g)
  	
  
This Agreement   and the rights hereunder may not be assigned by either party.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(h)
  	
  
Except as   otherwise provided herein, this Agreement and all the terms, covenants,   representations, warranties and provisions hereof do not survive the Closing   and shall be merged into the deed and/or any of the other documents of   conveyance.
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
(i)
  	
  
The   paragraph headings or captions appearing in this Agreement are for   convenience only, are not a part of this Agreement and are not to be   considered in interpreting this Agreement.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(j)
  	
  
This written   Agreement constitutes the complete agreement between the parties and   supersedes any prior oral or written agreements between the parties regarding   the Property.  There are no verbal   agreements that change this Agreement and no waiver of any of its terms will   be effective unless in a writing executed by the parties.
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
(k)
  	
  
This   Agreement binds and benefits the parties and their successors and assigns.
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
(l)
  	
  
This   Agreement has been made under the laws of the State of Minnesota, and such   laws will control its interpretation.
  

(Signature Pages to Follow)

15

          IN WITNESS WHEREOF, Seller and Buyer have executed this Agreement as of the Effective Date.

	
  
 
  	
  
SELLER:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
CIRCLE PINES MAINSTREET   II, LLC
  
	
  
 
  	
  
 
  	
  
 
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
/s/ BILL BEARD
  
	
  
 
  	
  
 
  	
  

  
	
  
 
  	
  
Its:
  	
  
President
  

	
  
STATE OF   MINNESOTA
  	
  
)
  
	
  
 
  	
  
) ss.
  
	
  
COUNTY OF   ANOKA
  	
  
)
  

          The foregoing instrument was acknowledged before me this 24th day of June, 2005, by Bill Beard, the President of Circle Pines Mainstreet II, LLC, a Minnesota limited liability company, on behalf of the company.

	
  
 
  	
  
/s/
  
	
  
 
  	
  

  
	
  
 
  	
  
Notary   Public
  

	
  
 
  	
  
BUYER:
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
NORTHERN TECHNOLOGIES INTERNATIONAL CORPORATION
  
	
   
  	
  
 
  	
  
 
  
	
  
 
  	
  
 
  	
  
 
  
	
  
 
  	
  
By:
  	
  
/s/ MATTHEW C. WOLSFELD
  
	
  
 
  	
  
 
  	
  

  
	
  
 
  	
  
Its:
  	
  
Chief   Financial Officer
  

	
  
STATE OF   MINNESOTA
  	
  
)
  
	
  
 
  	
  
) ss.
  
	
  COUNTY OF   ANOKA
  	
  
)
  

          The foregoing instrument was acknowledged before me this 24th day of June, 2005, by Matthew C. Wolsfeld, the Chief Financial Officer of NORTHERN TECHNOLOGIES INTERNATIONAL CORPORATION, a Minnesota corporation, on behalf of the corporation.

	
  
 
  	
  
/s/ ALICE HALVORSON
  
	
  
 
  	
  

  
	
  
 
  	
  
Notary   Public
  

EXHIBIT A

Legal Description of the Property

The real property located in Anoka County, Minnesota, to be replatted and legally described prior to Closing as follows:

          Lot 2, Block 1, Village at Circle Pines Third Addition, Anoka County, Minnesota.

EXHIBIT A-1

Depiction of the Property

[Attach copy of Preliminary Plat]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00087-of-00352.parquet"}]]