HomeMy WebLinkAboutItem 06.tDecember 29, 2015 qR
Item No.
TERMINATION AGREEMENT WITH NEW MARKET BANK
January 4, 2016 City Council Meeting
Proposed Action
Staff recommends adoption of the following motion: Move to approve a Termination
Agreement with New Market Bank.
Passage of this motion will terminate the Hold Harmless and Indemnity Agreement, dated
September 21, 2015, between the City of Lakeville and New Market Bank.
Overview
New Market Bank completed the requirements and obligations of the Thomas Meadows
Development Contract and entered into a Hold Harmless and Indemnity Agreement (HH&I
Agreement), dated September 21, 2015, with the City. The HH&I Agreement states that New
Market Bank agrees to defend, indemnify and hold harmless the City from liens and claims
made resulting from the Thomas Meadows plat, up to $23,076.94. New Market Bank is
requesting to terminate and release itself from the terms of the HH&I Agreement.
Primary Issues to Consider
• What are the impacts of the Termination Agreement? If there is any future claim made
for damages sustained or costs incurred resulting from the Thomas Meadows plat
approval and development, the City may incur costs.
Supporting Information
• Termination Agreement
Zach Johnson, City Engineer
Financial Impact: N/A Budgeted: N/A Source: N/A
Related Documents:
Notes:
Community Values: Diversified Economic Development
TERMINATION AGREEMENT
This TERMINATION AGREEMENT ("Termination Agreement'), effective the day of
2016, by and between the CITY OF LAKEVILLE, a Minnesota municipal
corporation ("City"), and NEW MARKET BANK, a Minnesota corporation (`Bank")
RECITALS
WHEREAS, the City and Bank are parties to a Hold Harmless and Indemnity Agreement
dated September 21, 2015 ("Agreement') a copy of which is attached hereto as Exhibit "A"; and
WHEREAS, the parties have determined that it is in their mutual interests to terminate the
Agreement.
NOW, THEREFORE THE PARTIES AGREE AS FOLLOWS:
1. The Agreement is terminated.
IN WITNESS WHEREOF, the parties hereto have executed this Termination Agreement as
of the date and year first above written.
CITY OF LAKEVILLE
ON
Matt Little, Mayor
Charlene Friedges, City Clerk
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EXHIBIT A
HOLD HARMLESS
AND INDEMNITY AGREEMENT
THIS HOLD HARMLESS AND INDEMNITY AGREEMENT (this "Agreement"} is
made as of September 21 , 2015, by and between the CITY OF LAKEVILLE, a
Minnesota municipal corporation ("Lakeville" or "City'), and NEW MARKET BANK, a
Minnesota corporation ("Bank").
RECITALS
A. Lakeville entered into a Development Contract with Rongitsch Properties, Inc., a
Minnesota corporation ("Developer"), dated March 14, 2007 and recorded with the Dakota County
Recorder's Office on March 25, 2007, as Document No. 2519660 for the approval and
development of the Thomas Meadows plat in Lakeville ("Development Contract").
B. Pursuant to the requirements of the Development Contract, Bank finished
Lakeville a letter of credit for $179,527.76.
C. The letter of credit in part guarantees the obligation of the Developer to hold the
City and its officers, employees, and agents harmless from claims made by itself and third parties
for damages sustained or costs incurred resulting from plat approval and development. The
Developer shall indemnify the City and its officers, employees, and agents for all costs, damages,
or expenses the City may pay or incur in consequence of such claims, including attorney's fees.
D. The Bank has requested that the City release the letter of credit.
NOW, THEREFORE, in consideration of their mutual covenants the parties agree as
follows:
1. Lakeville hereby releases that letter of credit attached hereto as Exhibit "A".
2. Bank agrees to defend, indemnify and hold harmless Lakeville, its officers,
employees, insurers or self-insurance pool, from liens on property in the City of Lakeville, whether
or not owned by Lakeville, and claims made and damages sustained or costs incurred by Lakeville
resulting from approval and development of the Thomas Meadows plat. The Bank shall indemnify
the City and its officers, employees, and agents for all costs, damages, or expenses the City may
pay or incur in consequence of such claims, including attorney's fees. This agreement to
indemnify, hold harmless and defend is limited to $23,076.94.
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CITY OF LAKEVILLE
Charlene Friedges, City
NEW MARKET BANK
By
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EXI]BIT "A"
TO
HOLD HARMLESS & INDEMNITY AGREEMENT
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NEW
Elco'. Me BANK
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JRREVOCABLE LETTER OF CREDIT
No. 1102
Date: March 14, 2007
TO. City of Lakeville
20195 Holyoke Avenue
Lakeville, Minnesota 55044
Dear Sir or Madam;
We hereby issue, for the account of R n�gWh Prooerties. Inc. And in your favor, our
Irrevocable Letter of Credit in the amount of $179,527.76, available to you by your draft drawn on
sight on the undersigned bank,
The draft must.
a) Bear the clause, "Drawn under Letter of Credit No. 1102, dated March 14, 2007, of
New Market Bank ";
b) Be signed by the Mayor or C'ty Administrator of the City of Lakeville.
c) Be presented for payment at 20151 lcerlic Trail Lakodile. MN , on or before
2:00 p.m on March 14, 2008.
This Letter of Credit shall automatically renew for successive one-year terms unless, at least
forty -fere (45) days prior to the next annual renewal date (which shall be March 14 of each year),
the Banc delivers written notice to the Lakeville City Administrator that 4 intends to modify the terms
of, or cancel, this Letter of Credit. Written notice is effective if sent by Certified mail, postage
prepaid, and deposited in the U S. Mail, at least forty-five (45) days prior to the next annual renewal
date addressed as follows: Lakeville City Administrator, Lakeville City Hail, 20195 Holyoke
Avenue, Lakeville, MN 55044, and is actually received by the City Administrator at least thirty (30)
days prior to the renewal date,
This Letter of Credit sets forth in full our understanding which shall not in any way be
modified, amended, amplified, or limited by reference to any document, instrument, or agreement.
whether or not referred to herein.
This Letter of Credit is not assignable. This is not a Notation Letter of Credit. More than one
draw may be made under this Letter of Credit.
P.O. &a 69,161 }Lin Street, New Mwket, NN 55050 20)5) kenk IWI, Ukilk. MN 55040
11276 2101h Street Yr., rAWIk. MN 55000 70856 Holyoke hmw, I.e wdle, NN 56044
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NEW'
,�KW BMK
www riewmarketbank.com
This Letter of Credit shag be govemed by the most recent rewsion of the Uniform Customs
and Practice for Documentary Credits, International Chamber of Commerce publication No. 600.
We hereby agree that a draft drawn under and in complianoe with this Letter of Credit shall
be duly honored upon presentation.
P.O. On 69,461 Main Strati, Nm- Market. MN &%M 2015] kerit Trail, lakrAk. M MR
11276 210th Strtet k'.. aWIk, MN 55016 2M M Holyoke herwe, I,41wilk, MN SS044
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