Loading...
HomeMy WebLinkAbout14. DCEFCU Lease Agreement AGENDA MEMO DATE: June 28, 2011 TO: Mayor and Members of the City Council FROM: Office of the City Manager By: Shannon DeLong, Assistant to the City Manager SUBJECT: LEASE AGREEMENT BETWEEN THE CITY OF DOWNEY AND THE DOWNEY CITY EMPLOYEES FEDERAL CREDIT UNION RECOMMENDATION That the City Council approve the attached Lease Agreement between the City of Downey and the Downey City Employees Federal Credit Union. DISCUSSION Staff has prepared a new lease agreement between the City and the employee credit union, which is located in City Hall. The first agreement was established in 1996 and was renewed in 2007 and 2009. (Prior to 1996, there was no lease agreement, and the credit union operated in City Hall based on providing positive employee relations.) The new agreement increases the insurance liability limits to the City’s current requirements. As in the past, the credit union will be required to pay for its phone and Internet service. The credit union will pay $4,320 per year for the space they use in City Hall. FISCAL IMPACT The Credit Union’s annual rental fee of $4,320 will be applied toward the annual cost of City Hall maintenance and operations. X:\CMANAGER\WPDOC\SDeLong\DCEFCU Lease Agreement.doc CITY OF DOWNEY, CALIFORNIA LEASE AGREEMENT BETWEEN THE CITY OF DOWNEY AND THE DOWNEY CITY EMPLOYEES FEDERAL CREDIT UNION This Lease Agreement (“Lease”) is made and executed in duplicate at Downey, st California, this 1 day of July 2011, by and between the City of Downey, a municipal corporation and charter city, hereinafter referred to as “Lessor,” and the Downey City Employees Federal Credit Union, a Federally Chartered Credit Union, hereinafter referred to as “Lessee.” 1. Demised Premises Lessor hereby leases to Lessee, and Lessee takes and leases in an “as is” condition from Lessor, for the term and upon the covenants and conditions set forth herein, that certain 400 square-foot office space located on the east end of the second floor of Downey City Hall northerly of the office of Personnel and southerly of the Training Room. 2. Lease Term The term of this Lease shall be for two (2) years commencing on July 1, 2011, and terminating on June 30, 2013. 3. Option Lessee shall have the option to extend this Lease upon the same covenants and conditions for two additional two-year periods upon serving notice to Lessor not less than sixty (60) days prior to the date of termination of this Lease provided that Lease is not in default of any provision of this Lease. The rental rate for any extension by the term of this Lease shall be determined by Agreement between the parties prior to the commencement of the Lease extension period. Additional extensions of the Lease term may be granted by mutual consent of the Lessor and Lessee. 4. Holding Over In the event that the extension of Lease Agreement cannot be completed prior to the termination date of this Lease, but such extension is in process, Lessee may remain upon the Demised Premises at the previous year’s rental rate until such Agreement is concluded. 5. Rent The annual rent shall $4,320 (Four Thousand, Three Hundred Twenty Dollars) payable monthly at the rate of $360 (Three Hundred Sixty Dollars) each month on the first day of each month. In the event that the Lessee has not paid the rent by the tenth day of the month, a five percent (5) penalty will be charged. 6. Other Charges Payable by Lessee Lessee shall pay all possessory interest taxes if any such taxes are assessed. 7. Utilities Lessee shall pay for any telephone or Internet service charges incurred upon the Demised Premises. 8. Permitted Uses Lessee shall use the Demised Premises only for Credit Union purposes and shall not sublease said premises without first receiving written permission from Lessor. 9. Indemnity Lessee shall defend (with counsel acceptable to Lessor), indemnify and hold Lessor, and Lessor’s officials, officers, employees, volunteers and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury, in law or equity, to property or persons, including wrongful death, in any manner arising out of or incident to any alleged negligent acts, errors, omissions or willful misconduct of Lessee, its officials, officers, employees, agents, consultants, contractors and subcontractors arising out of or in connection with Lessee’s use of the Demised Premises. Lessee shall defend, at Lessee's own cost, expense and risk, any and all such aforesaid suits, actions or other legal proceedings of every kind that may be brought or instituted against Lessor, and Lessor’s officials, officers, employees, agents or volunteers. Lessee shall pay and satisfy any judgment, award or decree that may be rendered against Lessee or Lessor’s officials, officers, employees, agents or volunteers, in any such suit, action or other legal proceeding. Lessee shall reimburse Lessor and Lessor’s officials, officers, employees, agents and/or volunteers, for any and all legal expenses and costs incurred by each of them in connection therewith or in enforcing the indemnity herein provided. 10. Insurance During the Lease term, Lessee shall, at Lessee’s sole cost and expense, provide and maintain, for the benefit of Lessor and Lessee, a policy of general public liability insurance to insure against all claims for personal injury, death, or property damage arising out of the possessory use, occupancy or maintenance of the Demised Premises. The amount of such insurance shall be at least TWO MILLION DOLLARS ($2,000,000.00). Insurance is to be placed with insurers with a current A.M. Best’s rating no less than A:VII, licensed to do business in California, and satisfactory to Lessor. However, the amount of such insurance shall not limit Lessee’s liability, nor relieve Lessee of any obligation hereunder. The City of Downey, and its employees, agents and volunteers shall be named as additionally insured. Lessor shall be provided with a certificate of insurance as evidence of such insurance. Said policy shall be kept in full force and effect during the Lease term. Lessor shall be notified in writing thirty (30) days prior to any modification or cancellation of said insurance policies. Lessee shall maintain Worker’s Compensation Insurance coverage as required by law. 11. Lessee’s Access The Lessees can only access the Demised Premises through Lessor’s office space. Therefore, Lessee’s Manager shall be furnished a key to the City Hall entrance so that the Manager may work in Demised Premises before or after Lessor’s normal business hours. 12. Defaults The occurrence of any of the following shall constitute a material default and breach of this Lease by Lessee. a) If Lessee fails to pay the rent or make any other payment required to be paid by Lessee hereunder as, and when, due. b) If Lessee abandons or vacates the Demised Premises. 13 Remedies In the event of any such default by Lessee, Lessor shall have the right to terminate this Lease and recover any unpaid rent and/or other costs incurred by Lessor due to Lessor’s default. 14. Notices All notices, demands, consents or requests required under this Lease shall be in writing and shall be personally delivered. Notices to Lessee shall be delivered to: 11111 Brookshire Avenue Downey, California, 90241 Attn: President Downey City Employees Federal Credit Union Notices to Lessor shall be delivered to: City of Downey 11111 Brookshire Avenue Downey, California, 90241 Attn: City Manager. All notices shall be effective upon delivery. 15. Applicable Law and Venue. This Agreement shall be governed by the laws of the State of California and the venue of any action brought hereunder shall be exclusively in the County of Los Angeles. 16. Entire Agreement. This Agreement is the entire agreement between the Parties hereto with respect to the subject matter hereof and supersedes all prior agreements between the Parties with respect to the matter contained in this Agreement. Any waiver, modification, consent or acquiescence with respect to any provision of this Agreement shall be set forth in writing and duly executed by both Parties. No waiver by any party or any breach hereunder shall be deemed a waiver of any other subsequent breach. 17. Successors and Assigns. This Agreement shall be binding upon the assignees, transferees and successors in interest of each of the Parties hereto. 18. Assignment. Neither party assign, transfer, convey, pledge nor otherwise dispose of its rights or obligations hereunder, without prior written consent of the other Party. 19. Time of Essence. Time is of the essence for each and every provision of this Agreement. 20. Invalidity; Severability. If any portion of this Agreement is declared invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect. 21. Authority to Enter Agreement. Each Party warrants that the individuals who have signed this Agreement have the legal power, right, and authority to make this Agreement and bind each respective Party. IN WITNESS WHEREOF, this Agreement has been duly authorized and executed by the Parties hereto on the day and year first herein above written. CITY OF DOWNEY DOWNEY CITY EMPLOYEES FEDERAL CREDIT UNION By:_______________________________ By:__________________________ Gerald M. Caton, City Manager Jon Hernandez, President, CEO ATTEST: __________________________ Joyce Doyle, Interim City Clerk APPROVED AS TO FORM: _____________________________ Yvette M. Abich Garcia, City Attorney