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CM-12-04-076ROUND ROCK, TEXAS PURPOSE. PNSSION. PROSPERITY Item Caption: Q,vi.-/1 O'' -O -(Q RECEIVED APR 19 7012 City Manager Approval Form Consider executing an agreement for use of space with the Round Rock Area Arts Council for space at the City's Business Center Complex located at 231 East Main Street. Approval Date: April 20, 2012 Department Name: Finance Department Project Manager: Cheryl Delaney Assigned Attorney: Steve Sheets Item Summary: This agreement allows for the Round Rock Area Arts Council (RRAAC) to use space in the City's Business Center Building to display public art. This space shall only be used for the sole purpose of "promoting or operating an art gallery, museum, or collection, in a permanent location or on tour, that is open to the public" as delineated in V.T.C.A., Tax Code, Section 11.18 et seq. No. of Originals Submitted: Project Name: Cost: Source of Funds: Select Source Fund Source of Funds (if applicable): Select Source Fund Account Number: Finance Director Approval: Cheryl Delaney Department Director Approval: Cheryl Delaney **Electronic signature by the Director is CIP ❑ Budget N/A OK N/A OK Date: 4/10/12 Date: 4/10/12 acceptable. Please only submit ONE approval form per item, Purchasing Ell Li N/A OK Accounting a N/A OK ITEMS WILL NOT BE PLACED ON THE COUNCIL OR CM AGENDA W/OUT PRIOR FINANCE AND/OR LEGAL APPROVAL REV. 6/20/11 AGREEMENT FOR USE OF SPACE BETWEEN THE CITY OF ROUND ROCK, TEXAS AND THE ROUND ROCK AREA ARTS COUNCIL 00248224.DOC/j kg/revised4/5/12 CM— (2- c$ -OL' AGREEMENT FOR USE OF SPACE This Agreement is entered into on the ZLday of. � , 2012, by and between the CITY OF ROUND ROCK, a Texas home -rule municipal corporation (the "City"), and the ROUND ROCK AREA ARTS COUNCIL, a Texas non-profit corporation within the meaning of Section 501(c)(3) of the Internal Revenue Code of 1986 and the Texas Tax Code, Section 11.18 (the "RRAAC"). Upon the terms and conditions herein set forth, and in consideration of the duties, covenants and obligations of the respective parties, City hereby agrees allow RRAAC to use approximately 1,223 square feet of space designated as Suite 160 within the City of Round Rock's Business Center Complex located at 231 East Main Street, Round Rock, Williamson County, Texas 78664 (the "Space"), as described on Exhibit "A" attached hereto and incorporated herein by reference for all purposes, so long as such use is to effectuate and accomplish a permissible public purpose of City, and so long as such use does not negatively impact City's entitlement to tax exempt status of the building. Article 1 Consideration 1.1 Mutual Consideration. The parties hereto expressly acknowledge and stipulate that this Agreement is entered into in consideration of the benefit to City of effectuating and accomplishing a permissible public purpose, the use of the Space as recited herein, the value to City of ensuring occupancy and use of its property, and other good and valuable consideration given, the receipt and sufficiency of which is hereby acknowledged. 1.2 Permissible Public Purpose. The parties hereto expressly acknowledge and stipulate that this Agreement is for the permissible public purpose of City's facilitation of use of the Space by an entity which will provide encouragement, promotion, improvement, and application of the arts, including folk art, design, painting, sculpture, photography, graphic and craft arts, and other arts related to the presentation, execution, and exhibition of such major art forms, and that such public purpose is intended to provide a positive impact and experience for City's citizenry who participate in production of the art and for City's citizenry and others who participate in viewing of the art. Article 2 Term; Renewal 2.1 Initial Term. The term of this Agreement shall be for one (1) year, commencing on April 1, 2012 and ending on March 31, 2013, unless terminated earlier as provided herein. 2.2 Renewals. RRAAC may request that City renew this Agreement. City retains the sole and exclusive right to either grant RRAAC such a one (1) year renewal of this Agreement, or a month-to-month extension following the expiration of the initial term. 2.3 Early Termination. It is expressly acknowledged by the parties that this Article 2 is subject to the provisions for early termination contained in Article 9, Subsection 9.3 herein, and that this Agreement may be terminated for cause or convenience by either of the parties in 2 accordance with Article 9 herein, and that such termination may be effected at any time during the initial term or any successive renewal terms or month-to-month extension terms. Article 3 Use of Premises 3.1 Specified Use. RRAAC, operating as a charitable organization, shall use the Space only for "promoting or operating an art gallery, museum, or collection, in a permanent location or on tour, that is open to the public" as is delineated in V.T.C.A., Tax Code, Section 11.18 et seq. 3.2 Prohibitions Regarding Use. RRAAC shall not permit the Space or any part thereof to be used for (a) the conduct of any offensive, noisy, or dangerous activity that may increase the premiums for fire or other insurance on the building; (b) the creation or maintenance of a public nuisance; (c) anything which is against public regulations or rules of any public authority at any time applicable to the building; or (d) any purpose or in any manner that may obstruct, interfere with, or infringe on the rights of other occupants of the building. 3.3 Approval Required for Certain Use. RRAAC shall use the premises only for the purposes set out in 3.1 above, and such reasonable rules and regulations as are imposed from time to time by City with respect to the Space. Any use of the premises which will affect the appearance of the building, impact the tax exempt status of the building, exceed structural loads of floors or walls, affect the mechanical, plumbing or electrical systems of the building, affect ventilation in other areas of the building, or potentially interfere with other occupants of the building must have City's prior written approval. 3.4 Access. RRAAC and its volunteers/employees shall have access to the premises at all times. RRAAC's invitees, customers and the general public shall have access to the premises during normal business hours and, at RRAAC's election, after business hours if RRAAC complies with security procedures City shall reasonably promulgate from time to time. Article 4 Improvements 4.1 Construction of Improvements. RRAAC shall construct, or cause the construction of, all art gallery display improvements to the interior of the Space, which improvements shall comply with design and decor standards as City shall reasonably promulgate. Such improvements shall include, by way of illustration and not limitation, display cases, display boards, and lighting. 4.2 Ownership of Improvements. Upon completion of alterations and improvements constructed or placed in the Space, with the exception of movable personal property, all ownership and title to same shall vest in City and same shall remain in the Space at the expiration or earlier termination of this Agreement. City accepts construction and title to such improvements to be adequate and sufficient consideration. 4.3 City Signage. City reserves the right to place its own logo and signage on and in the Space, including on outer doorways and entrances. 3 Article 5 Performance Representations by RRAAC RRAAC hereby covenants and agrees to do the following: 5.1 Occupy the Space for the initial term, on the terms and conditions enumerated herein, beginning on the Commencement Date (Initial Term) of April 1, 2012 and ending on the Expiration Date (Initial Term) of March 31, 2013, or ending on the last day of any allowed renewal term or any allowed month-to-month extension, unless terminated earlier according to terms and conditions set forth herein. 5.2 Accept the Space in its present condition, acknowledging that same is suitable for RRAAC's intended use. 5.3 Attach signage acceptable to City on the Space for identification purposes. 5.4 Arrange and be responsible for obtaining and paying for RRAAC's own telephone and internet service, and obtaining any necessary hardware for the operation and maintenance of such services. 5.5 Arrange and be responsible for obtaining any necessary equipment for the operation of RRAAC's business, such as computers, printers and fax machines 5.6 Pay for any utility services used by RRAAC which are not provided by City. 5.7 Park in the areas designated by City. 5.8 Maintain the Space clean and free of trash and debris in accordance with City standards. 5.9 Utilize the coded security system for access after normal business hours. 5.10 Wear security badges while on the premises. 5.11 Obey all laws, rules, regulations, and terms of this Agreement and of the use, condition, and occupancy of the premises, including the rules and regulations of the building, if any, adopted by City from time to time. 5.12 Vacate the Space upon termination of this Agreement, and surrender all keys and building access cards to the premises. 5.13 Allow City to enter the Space to perform City's obligations, or to reasonably inspect the Space, or at reasonable times to show the Space to prospective occupants. 5.14 Submit written notifications and/or requests to City relative to any events of consequence involving the premises. 5.15 Maintain appropriate insurance on RRAAC's personal property located within the Space. 4 5.16 Upon written request, deliver certificates of insurance to City. 5.17 Indemnify, defend, and hold City harmless from any loss or claim arising out of RRAAC's use of the Space or resulting from RRAAC's failure to comply with applicable provisions of this Agreement. Article 6 Prohibition Representations by RRAAC RRAAC hereby covenants and agrees not to do the following: 6.1 Use the Space for any purpose other than the Specified Use delineated herein in Article 3, Subsection 3.1. 6.2 Create a nuisance. 6.3 Interfere with other occupants' normal business operations, or interfere with City's ownership or management of the building. 6.4 Permit any waste. 6.5 Use the Space in a way that is extrahazardous, that would increase insurance premiums, or that would void insurance on the building. 6.6 Change City's lock system, except as permitted in advance in writing. 6.7 Alter the Space, except as specifically provided for herein, or place any exterior sign on the premises, without City's consent, which consent shall not be unreasonably withheld. 6.8 Allow a lien to be placed on the Space. 6.9 Assign or sublet any portion of the Space without City's prior written consent. Article 7 Performance Representations by City City hereby covenants and agrees to do the following: 7.1 Allow the Space to be occupied by RRAAC for the initial term, on the terms and conditions enumerated herein, beginning on the Commencement Date (Initial Term) of April 1, 2012 and ending on the Expiration Date (Initial Term) of March 31, 2013, or ending on the last day of any allowed renewal term or any allowed month-to-month extension, unless terminated earlier according to terms and conditions set forth herein. 7.2 Provide water for lavatory and drinking purposes, access to electric current for normal office machines and building standard lighting reasonable for RRAAC's use, and lighting in common areas. 7.3 Provide access and use of common areas to RRAAC, such as breakrooms, restrooms, and food areas. 5 7.4 Provide access and use of conference room areas to RRAAC by appropriate reservation through the City. 7.5 Pay operating expenses for the premises. Operating expenses shall mean expenses that City shall be required to pay in connection with the ownership and maintenance of the building, except principal and interest on any debt, expenditures classified as capital expenditures for federal income tax purposes, and expenses for which RRAAC may be required to reimburse City. 7.6 Repair and maintain the (a) roof, (b) foundation, (c) exterior walls, doors and windows as to structural soundness but not as to appearance, and (d) plumbing, electrical and mechanical systems that serve the premises. 7.7 Adequately insure the building and parking facilities against risks of direct physical loss. The parties agree that RRAAC shall have no claim to any proceeds of City's insurance policies. Article 8 Prohibition Representations by City City hereby covenants and agrees not to do the following: 8.1 Interfere with possession of the premises so long as RRAAC is not in default. 8.2 Unreasonably withhold consent, if required herein to be given. Article 9 Termination 9.1 Cit_y's Right to Terminate for Convenience. City has the right to terminate this Agreement, in whole or in part, for convenience and without cause, at any time upon thirty (30) days' written notice to RRAAC. 9.2 Cit_y's Right to Terminate for Cause. In the event of any default or breach by RRAAC, City has the right to terminate this Agreement for cause, upon ten (10) days' written notice to RRAAC. 9.3 City's Right of Early Termination. In the event City reasonably determines that it requires the Space for housing City staff or other public purpose, City has the right to early termination of this Agreement, and such early termination shall be effected by City giving ten (10) days' written notice to RRAAC. 9.4 RRAAC's Right to Terminate for Convenience. RRAAC has the right to terminate this Agreement, in whole or in part, for convenience and without cause, at any time upon thirty (30) days' written notice to City. Article 10 Default 10.1 Default by RRAAC. Default by RRAAC shall be defined as failing to comply, within ten (10) days of receiving written notice from City, with any substantive provision hereof. 6 City's remedies for RRAAC's default are to (a) enter and take possession of the Space, after which City may re -contract for the premises on behalf of RRAAC, and RRAAC agrees to reimburse City for actual expenditures reasonably made; or (b) enter the Space and perform RRAAC's obligations; or (c) terminate this Agreement by proper written notice and sue for damages. 10.2 Default by City. Default by City shall be defined as (a) City failing to comply with applicable provisions of this Agreement which constitute default; or (b) City failing to begin a reasonable attempt to comply with any substantive provision of this Agreement within ten (10) days of receiving proper written notice. RRAAC's remedy for City's default is termination of this Agreement if City fails to provide an essential service for thirty (30) days after default. 10.3 No Waiver. It is not a waiver of default if the non -defaulting party fails to declare immediately a default, or delays in taking any action. Pursuit of any remedies set forth in this Agreement does not preclude pursuit of other remedies in this Agreement or as provided by law. City and RRAAC have a duty to mitigate damages. Article 11 City's Rights upon Termination of Agreement 11.1 Property to Inure to City. All of RRAAC's improvements, fixtures and equipment of every description (unless such improvements, fixtures and equipment are removable without damage to the premises), any alterations or additions to the premises including those made with written consent, and any other article incorporated in or permanently affixed to the floor, wall or ceiling of the premises, shall become the property of City and shall be and remain upon and be surrendered with the premises as a part thereof at the termination of this Agreement, whether under Article 9 or Article 10 herein, and RRAAC hereby waives all rights to any payment or compensation therefor. In the event City requests that RRAAC remove any of RRAAC's removable fixtures, equipment or property located in or about the premises or the building at the termination of this Agreement, RRAAC shall promptly remove same at its sole risk, cost and expense, and upon RRAAC's failure to remove same, City may remove same at RRAAC's expense. Article 12 Liability and Indemnification 12.1 Liability. The parties expressly agree that nothing in this Agreement adds to or changes the liability limits and immunities for a governmental unit provided by the Texas Tort Claims Act, Chapter 101, Civil Practice and Remedies Code, or other law. The parties expressly agree that, in the execution of this Agreement, neither party waives, nor shall be deemed hereby to waive, any immunity or defense that would otherwise be available to it against claims arising in the exercise of its powers or functions or pursuant to the Texas Tort Claims Act or other applicable statutes, laws, rules, or regulations. 12.2 Indemnification. RRAAC shall defend (at the option of City), indemnify, and hold City, its successors, assigns, officers, employees and elected officials harmless from and 7 against all suits, actions, legal proceedings, claims, demands, damages, costs, expenses, attorney's fees, and any and all other costs or fees arising out of, or incident to, concerning or resulting from the fault of RRAAC, or its agents, invitees, employees or subcontractors, in the performance of RRAAC's obligations under this Agreement, no matter how, or to whom, such loss may occur. Nothing herein shall be deemed to limit the rights of City or RRAAC (including, but not limited to the right to seek contribution) against any third party who may be liable for an indemnified claim. Article 13 Building Security 13.1 Building Access Cards, Keys and Badges. City will provide RRAAC with an adequate number of access cards, keys and security identification badges to the premises. Additional access cards, keys and badges may be obtained at RRAAC's cost and expense. No additional locks shall be allowed in the premises without City's consent. Only with express prior written consent of City, RRAAC may, at its sole cost and expense, change locks within its own premises area, provided that RRAAC furnishes a complete set of keys to all such locks to City, and provided that such change of locks in no way impairs access to the common areas of the premises. Upon termination of this Agreement, RRAAC shall surrender to City all access cards, keys and badges to the premises. Article 14 RRAAC's Obligation for Condition of Premises 14.1 Duty to Maintain, Surrender, and Repair/Replace. RRAAC covenants and agrees that it will not injure the building or the premises but will take the same care thereof which a reasonably prudent person would take of his/her own property, and upon termination of this Agreement, RRAAC will surrender and deliver up the premises to City in as nearly identical condition as the premises were in on the commencement date of this Agreement, except for ordinary wear and tear and damage arising from fire or other casualty. RRAAC agrees, at its cost and expense, to repair or replace any part of the premises damaged as a proximate result of negligent or wrongful acts or omissions of RRAAC or its agents, employees, representatives, invitees, licensees or visitors and to repair damage to the building proximately caused by the negligence or wrongdoing of RRAAC or its agents, employees or representatives acting within the scope of their agency, employment or representation; provided, however, that if RRAAC should fail or refuse to make such repairs or replacements with reasonable promptness after written notice from City (having due regard to the nature of the required repairs or replacements and the effect of delay in making same on the appearance of the building or danger of injury to or interferences with others), then City may, at its option but without any obligation to do so, enter the premises and make such repairs or replacements on the premises, should they be required, and RRAAC shall repay the actual costs thereof upon demand. Article 15 RRAAC's Obligation of Compliance with Laws 15.1 Duty to Comply. RRAAC will at its own cost and expense comply with all laws, ordinances, orders, rules and regulations (state, federal, municipal or promulgated by other agencies or bodies having jurisdiction thereof) relating to the use, condition or occupancy of the premises, and will not engage in any activity which would cause City's fire and extended 8 coverage insurance to be canceled or the rate therefor to be increased over the rate which would have been charged had such activity not been engaged in by RRAAC (or in such event, at RRAAC's option, RRAAC will pay the amount of any such increase). Article 16 Miscellaneous Provisions The parties to this Agreement agree as follows: 16.1 Binding Effect. The covenants and agreements herein contained shall inure to and be binding upon City and upon its successors and assigns, and upon RRAAC and upon its successors and assigns; provided such reference to assigns is not intended to imply or grant any right on the part of either party to assign this Agreement. 16.2 Release of Claims/Subrogation. City and RRAAC hereby release each other from any claim, by subrogation or otherwise, for any damage to the premises, the building, the parking facilities, or personal property within the building, by reason of fire or the elements, regardless of cause, including negligence of either party. This release applies only to the extent that it is permitted by law, the damage is covered by insurance proceeds, and the release does not adversely affect any insurance coverage. 16.3 Notice to Insurance Companies. City and RRAAC shall notify the issuing insurance companies of the release set forth in this Article 16, Subsection 16.2, and shall have the insurance policies endorsed, if necessary, to prevent invalidation of coverage. 16.4 Casualty/Total or Partial Destruction. If the premises are damaged by casualty, the City may, at its sole option, choose not to restore the premises. In that case, this Agreement will terminate. 16.5 Condemnation/Substantial or Partial Taking. If the premises cannot be used for the purposes contemplated by this Agreement because of condemnation or purchase in lieu of condemnation, then this Agreement will terminate. RRAAC shall have no claim to the condemnation award or proceeds in lieu of condemnation. 16.6 No Arbitration. In the event of any dispute regarding terms or performance of terms of this Agreement, it is agreed by the parties that such dispute shall not be subject to arbitration. 16.7 Limitation of Warranties. There are no implied warranties of merchantability, of fitness for a particular purpose, or of any other kind arising out of this Agreement, and there are no warranties that extend beyond those expressly stated herein. 16.8 Abandoned Property. City may retain, destroy, or dispose of any property left and abandoned on the premises at the end of the initial term and any renewals. 16.9 Time is of the Essence. Time is expressly declared to be of the essence in this Agreement. 9 16.10 Amendment. No amendment, modification, or alteration of the terms of this Agreement shall be binding unless the same be in writing, dated subsequent to the date of this Agreement, and duly executed by the parties to this Agreement. 16.11 No Third Party Beneficiaries. No term or provision of this Agreement is intended to, or shall, create any rights in any person, firm, corporation, or other entity not a party hereto, and no such person or entity shall have any cause of action hereunder. 16.12 No Other Relationship. No term or provision in this Agreement is intended to create a partnership, joint venture, or agency arrangement between the parties. 16.13 Current Revenues. Pursuant to Section 791.011(d)(3) of the Texas Government Code, each party performing services or furnishing services pursuant to this Agreement shall do so with funds available from current revenues of the party. 16.14 Force Majeure. Notwithstanding any other provisions of this Agreement to the contrary, no failure, delay or default in performance of any obligation hereunder shall constitute an event of default or a breach of this Agreement if such failure to perform, delay or default arises out of causes beyond the control and without the fault or negligence of the party otherwise chargeable with failure, delay or default; including but not limited to acts of God, acts of public enemy, civil war, insurrection, riots, fires, floods, explosion, theft, earthquakes, natural disasters or other casualties, strikes or other labor troubles, which in any way restrict the performance under this Agreement by the parties. 16.15 Entire Agreement. This Agreement constitutes the entire agreement of the parties regarding the subject matter contained herein and supersedes any agreements of the parties, whether oral or written, formal or informal, heretofore made. 16.16 Approval. This Agreement has been duly and properly approved by each party's governing body and constitutes a binding obligation on each party. 16.17 Assignment. Except as otherwise provided in this Agreement, a party may not assign this Agreement or subcontract the performance of services without first obtaining the written consent of the other party. 16.18 Non-Appropriation and Fiscal Funding. The obligations of the parties under this Agreement do not constitute a general obligation or indebtedness of either party for which such party is obligated to levy, pledge, or collect any form of taxation. It is understood and agreed that City shall have the right to terminate this Agreement at the end of any City fiscal year if the governing body of City does not appropriate sufficient funds as determined by City's budget for the fiscal year in question. City may effect such termination by giving RRAAC written notice of termination at the end of its then-current fiscal year. 16.19 Non-Waiver. A party's failure or delay to exercise a right or remedy does not constitute a waiver of the right or remedy. An exercise of a right or remedy under this Agreement does not preclude the exercise of another right or remedy. Rights and remedies under this Agreement are cumulative and are not exclusive of other rights or remedies provided by law. 10 16.20 Paragraph Headings. Various paragraph headings are inserted for convenience of reference only, and shall not affect interpretation of this Agreement or any subsection herein. 16.21 Counterparts. This Agreement may be executed in multiple counterparts which, when taken together, shall be considered as one original. 16.22 Severability Clause. If any term, covenant, condition or provision of this Agreement, or the application thereof to any person or circumstance, shall ever be held to be invalid or unenforceable, then in each such event the remainder of this Agreement or the application of such term, covenant, condition or provision to any other person or any other circumstance (other than such as to which it shall have been invalid or unenforceable) shall not be thereby affected, and each term, covenant, condition and provision hereof shall remain valid and enforceable to the fullest extent permitted by law. 16.23 Notices. Any notice or communication to parties required or permitted to be given under this Agreement shall be effectively given only if in writing, and such notice shall be considered received three (3) days after depositing such notice in the U.S. registered or certified mails, postage prepaid, return receipt requested, or by commercial overnight courier service, addressed as follows: (a) If addressed to City: Round Rock City Manager 221 East Main Street Round Rock, TX 78664 (b) If addressed to RRAAC: Round Rock Area Arts Council Post Office Box 5981 Round Rock, Texas 78664 City Attorney Stephan L. Sheets AND TO: 309 East Main Street Round Rock, TX 78664 provided, however, that any party shall have the right to change the address to which notices shall thereafter be sent by giving notice to the other party as aforesaid, but not more than two addresses shall be in effect at any given time for City and RRAAC. 16.24 Attorney's Fees. In the event of litigation between City and RRAAC wherein one or both parties are seeking to enforce any right or remedy hereunder, the prevailing party shall be entitled to recover its reasonable attorneys' fees incurred in connection with such litigation from the other party. 16.25 Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the state of Texas, and venue shall lie in Williamson County, Texas. 16.26 Contacts. The parties hereto agree that the persons listed below shall be the main points of contact: 11 (a) For City: Cheryl Delaney, Finance Director (512) 218-5445 email: cdelaney@roundrocktexas.gov (b) For RRAAC: Cathy Kincaid, President (512) 989-6808 email: ckincaid@impactnews.com 16.27 Incorporation of Exhibits. All exhibits, schedules and attachments referred to in this Agreement are hereby incorporated by reference for all purposes as fully as if set forth at length herein. This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof, and all prior correspondence, memoranda, agreements or understandings (written or oral) with respect hereto are merged into and superseded by this Agreement. IN WITNESS WHEREOF, this Agreement is executed and delivered effective as of the date and year first above written. CITY OF ROUND ROCK, TEXAS SRU.mtIovwoo,d tiil fr J By: Name: Title: Date: ROUND ROCK AREA ARTS COUNCIL, a Texas non-profit corporation By: Name: Title: Date: 12 FOR CITY, ATTEST: FO ' C TY, APPROV D AS TO FORM: Stephan Sheets, City Attorney