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2019-097 Approving the Mediated Settlement and the Addendum to the Mediated Settlement Agreement and Release between the City of Hopkins, the Housing and Redevelopment Authority in and for the City of Hopkins, Doran 810 LLC and Doran 810 Apartments, LLC CITY OF HOPHINS Hennepin County, Minnesota RESOLUTION 2019-097 A RESOLUTION APPROVING THE MEDIATED SETTLEMENT AND THE ADDENDUM TO THE MEDIATED SETTLEMENT AGREEMENT AND RELEASE BETWEEN THE CITY OF HOPHINS, THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF HOPKINS, DORAN 810 LLC AND DORAN 810 APARTMENTS, LLC WHEREAS, on March 4, 2016, Doran 810 LLC and Doran 810 Apartments, LLC (collectively "Doran") and City of Hopkins ("City", which together with Doran may hereinafter be collectively be referred to as the"Parties") entered into a Reimbursement and Purchase Option Agreement ("Purchase Ageement") and a Development Agreement; and WHEREAS, pursuant to the Purchase and Development Agreements, Doran agreed to construct, and the City agreed to buy or reimburse Doran for the cost of a Grade-Level Garage(the "Garage"); and WHEREAS, Doran completed construction of the Garage on or around March 23, 2018; and WHEREAS, the closing on the purchase of the Garage did not occur; and WHEREAS, on July 31, 2018, Doran served the City with a Summons and Complaint alleging, among other things, that the City breached the Purchase and Development Agreements by failing and refusing to close on Garage; and WHEREAS, on August 30, 2018, the City answered Doran's Complaint and denied liability under the Purchase Agreement; and WHEREAS, the City also asserted Counterclaims against Doran alleging, among other things, that Doran had breached the terms of the Development Agreement thereby resulting in damage to the City; and 1 610186v2BE295-315 WHEREAS, to avoid the uncertainties, risks and expenses of protracted litigation, the Parties entered into a mediated Settlement Agreement on August 2, 2019 (the "Mediated Agreement"); and WHEREAS, pursuant to Paragraph 2 of the Mediated Agreement, the parties have prepared the attached Addendum to the Mediated Settlement Agreement and Release which requires approval of the City Council, contains mutual releases between the parties, and provides for cancellation of the Purchase Agreement. NOW, THEREFORE, BE IT RESOLVED THAT the above-referenced recitals are incorporated herein to this Resolution. NOW, THEREFORE, BE IT FURTHER RESOLVED, that the City Council hereby approves the Mediated Settlement and the Amendment to the Mediated Settlement Agreement and Release in substantially the form as attached hereto as Exhibit A, the contents of which are incorporated herein by reference. NOW, THEREFORE, BE IT FURTHER RESOLVED THAT, the City Manager and the City Attorney are hereby authorized and directed to take any and all additional steps and actions necessary or convenient to prepare the appropriate documents and/or ageements to facilitate the directives of the City Council as provided herein in order to accomplish the intent of this Resolution. ,----- The above resolution was approved/denied by a vote of �� to Adopted by the City Council of the City of Hopkins this 1 T"day of Dece ber, 2019. � � ason Gadd, Mayor ATTEST: � r n'/, „ ^ W 1 Amy Domeier, City Clerk 2 610186v2BE295-315 EXHIBIT A FORM OF ADDENDUM TO MEDIATED SETTLEMENT AGREEMENT AND RELEASE ADDENDUM TO MEDIATED SETTLEMENT AGREEMENT AND RELEASE This Add.endum to Mediated Settlement Agreement and Release (hereinafter this "Addendum") is entered into to be effective as of the 2nd day of August, 2019, by and among Doran 810 LLC and Doran 810 Apartments, LLC (collectively "Doran") and City of Hopkins ("Hopkins", which together with Doran may hereinafter be collectively be referred to as the "Parties"). WHEREAS, on March 4, 2016, the Parties entered into a Reimbursement and Purchase Option Agreement("Purchase AgreemenY'). WHEREAS, a Development Agreement was executed as of March 4, 2016, between the Housing and Redevelopment Authority in and for the City of Hopkins,the City of Hopkins, Doran 810 Apartments, LLC and Doran 810 LLC, as amended by that First Amendment to Development Agreement, dated February 2, 2017, and as amended and restated by that Amended and Restated Development Agreement, dated (the "Development Agreement"). WHEREAS,pursuant to the Purchase Agreement and the Development Agreement,Doran agreed to construct, and Hopkins agreed to buy or reimburse Doran for the cost of a Grade-Level Garage (the "Garage"). WHEREAS, Doran completed construction of the Garage on or around March 23, 2018. WHEREAS, the Parties did not close on the sale of the Garage from Doran to Hopkins. �2028698�£295-315 WHEREAS, on July 31, 2018, Doran served Hopkins with a Summons and Complaint alleging, among other things, that Hopkins breached the Purchase Agreement by failing and refusing to close on Garage. WHEREAS,on August 30, 2018, Hopkins answered Doran's Complaint, denied liability, and asserted Counterclaims against Doran. WHEREAS, to avoid the uncertainties, risks and expenses of protracted litigation, the Parties entered into a Mediated Settlement Agreement on August 2, 2019, a copy of which is attached hereto as Exhibit A and incorporated herein (the"Mediated AgeemenY'). WHEREAS, this Addendum incorporates the mutually acceptable release referenced in Paragraph 2 of the Mediated Agreement and also amends the Mediated Settlement based on subsequent negotiations between the Parties. NOW, THEREFORE, in return for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows: 1. The Mediated Agreement is amended to provide that the two currently issued TIF notes shall remain and that a new TIF note shall be issued in the principal amount of$8,000,000.00. 2. With respect to Section 6.5 of the Development Agreement, as amended and restated in that certain Amended and Restated Development Agreement dated , 2019, the Calculation Date and Stabilization have passed and the calculations have occurred with respect to Note A and Note B. Section 6.5 of the Development Agreement, as amended, is not operative as of, and after, August 2, 2019; and, it does not apply to Note C (as defined in the Amended and Restated Development Agreement). 3. Except for any defaults under this Addendum or the Mediated Agreement, the Parties hereby release, acquit and forever discharge each other, together with any successors and 4 �2o2��os�z9s-3►s assigns from any and all actions, suits, claims, contractual obligations, agreements, remedies, recourse and demands, whether known or unknown, foreseen or unforeseen, including unforeseen consequences of known or unknown conditions or injuries, liquidated or unliquidated, fixed, contingent, direct, or indirect, which the Parties ever had, now have or may have in the future against each other,which have or could have been asserted by the Parties with respect to the Garage and Purchase Agreement or any claims the Parties knew or should have known about as of the date of this Addendum. Without limiting the foregoing, the Parties hereby agee, stipulate, and acknowledge that the Purchase Agreement is hereby terminated in its entirety and is and shall be of no force or effect and neither of the Parties shall have any liabilities or rights under or with respect to the Purchase Agreement. 4. In entering into this Addendum, the Parties each represent that they have been represented by independent legal counsel, or that they have had the opportunity to be represented by independent legal counsel, that they have read and completely understand the terms of this Addendum, and that those terms are fully understood and voluntarily accepted by them. The Parties further affirmatively represent that they have voluntarily entered into this Addendum and that there are no representations made by the Parties, or their attorneys, agents or other representatives which are not expressly set forth in this Addendum. 5. It is specifically understood that,by reason of entering into this Addendum and the Mediated Agreement, no party admits liability of any sort and that such Parties have made no representations as to the extent of damages and/or injuries or the liability issues previously raised. It is further specifically understood and agreed that this Addendum shall not be construed as an admission of liability on the part of the parties, or by anyone else, liability having, at all times, been denied. 5 �2028698�295-315 6. The Parties agree that they shall make no disparaging remarks about the other. 7. This Addendum may be executed in any number of counterparts, all of which shall constitute a single Addendum. 8. This Addendum shall be construed and interpreted in accordance with the laws of the State of Minnesota. 9. This Addendum and the Mediated Agreement constitute a full and complete Addendum between the parties hereto and may not be modified except by a writing signed by all of the Parties hereto. IN WITNESS WHEREOF, the parties intending to be legally bound, execute this Addendum to be effective as of the date first shown above. DORAN 810 LLC Date: By: Kelly J. Doran Its: Chief Manager DORAN 810 APARTMENTS, LLC Date: By: Kelly J. Doran Its: Chief Manager CITY OF HOPKINS Date: gy Jason Gadd Its: Mayor Date: By Michael J. Mornson Its: City Manager 6 �Zo2seB��29s-3�s � �2o2seo��29s-3 i s HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF HOPKINS (AS TO PARAGRAPH 2 ONLY) Dated: By: Jason Gadd Its: Chair Dated: By: Michael Mornson Its: Executive Director 8 �xozsea��29s-3�s Exhibit A tiF.'I 11.F.f1t};'V'I':'LG124:I:�tENi' Uor;a 510,LI.(',(lurxo Rll►Apurtmcntc,LLC�•s.('ih•��f Hupkins 2?-C Y-12i-151141 I)rii�ndant��ilt�,;i� tu Yluintifl-,and Pluiniift�will;,cci:p;in 1'ull�citlrmcnt uf an4 and all clai�u,�;aii�.st llrt�.n�tnnt.thc;um of S � �,{ 1. P:,.�nent h� Drfcndant,h�ll hc ma:ir in the folluai�g manner. P� " , 1 '- � }�1H.��.t�YS��( , "�L�'� ��-��(�.41 UU I 1 � t�C.�i,.l b�1��l�'d��U �� -t.�}��'1��; ' �-� ' , .�' _;` ,�� 7�`��!`�1 •-��'�t� [`.�� , � ' 1� �v'�`- l �},)�1` � �-,�'l I11F�4�l.dh �, C'��t�l 1P� �v�E; . `ft�1�. 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