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HomeMy WebLinkAbout2011-03-22 - AGENDA REPORTS - NEXTG USE AGMT (2)CONSENT CALENDAR DATE: SUBJECT: DEPARTMENT: Agenda Item: 5 CITY OF SANTA CLARITA AGENDA REPORT City Manager Approval Item to be presented by: March 22, 2011 Jim Jordan APPROVAL OF RIGHT-OF-WAY USE AGREEMENT BETWEEN THE CITY OF SANTA CLARITA AND NEXTG NETWORKS OF CALIFORNIA Public Works RECOMMENDED ACTION 1. City Council approve a Right -of -Way Use Agreement with NextG Networks of California for the purpose of constructing localized fiber based telecommunication networks in portions of the City of Santa Clarita. 2. Authorize the City Manager or designee to execute the Agreement, subject to City Attorney approval. BACKGROUND NextG Networks of California (NextG) has applied for an encroachment permit to construct localized fiber based telecommunication networks in the City of Santa Clarita. NextG will provide a network of small nodes or antennas located on street lights within the public fight -of -way connected together by fiber optic cable. Where available, the fiber optic cable will be placed in existing underground conduits. When underground conduits are not available, these cables will be installed in shallow pavement cuts on public streets.. The placement of these installations will be planned with the least amount of impact to the City's streets under consultation with the City's Public Works Department. This cabling will provide the infrastructure needed for one or more retail mobile service providers that currently have no service or minimal service in the selected areas. Staff and NextG have negotiated the proposed Right -of -Way Use Agreement to define NextG's authority to operate in the City's right-of-way. The City's ability to restrict NextG's operations in the City's right-of-way is severely limited by the California Public Utilities Commission. Specifically, this provides NextG the opportunity to use existing City -owned utility poles as an alternative to allowing the placement of new poles in addition to (and generally adjacent to) existing ones located in parts of the City. The equipment that is attached to above ground facilities includes an antenna and a control box as shown in Exhibit "A." The equipment is not mechanical in nature, and the only noise emitted comes from an internal cooling fan similar to that in a laptop computer and is inside the control box. Photographs of several typical installations in other municipalities are provided as Exhibit "C." NextG currently has an agreement with a retail mobile provider for six installation sites within the City. Eleven additional sites are under consideration for construction in 2011 and 2012, but have not been confirmed. According to NextG, the maximum number of sites is three per square mile. The area of the City is approximately 53 square miles for a total of 159 sites. ALTERNATIVE ACTIONS The City Council can elect not to approve the Right -of -Way Use Agreement. In that event, NextG can proceed to gain relief through the court system for the opportunity to erect new poles at their desired locations that will only serve NextG's interests. FISCAL IMPACT This agreement represents an opportunity to receive annual revenue for use of the City's right-of-way of $500 for each pole co -location or attachment, and $500 per installation for a new pole when no alternative is available. Encroachment permits and inspection fees will be paid for each installation so that City staff can inspect the installations. ATTACHMENTS Right -of -Way Use Agreement Exhibit "A" - Sketches Exhibit "B" - Faithful Performance Bond Exhibit "C" - Installation Photographs PRI A CITY OF SANTA CLARITA RIGHT-OF-WAY USE AGREEMENT THIS RIGHT-OF-WAY USE AGREEMENT ("Agreement") is entered into on , 2011 ("Effective Date"), by the CITY OF SANTA CLARITA, a California municipal corporation ("City"), and NEXTG NETWORKS OF CALIFORNIA, INC., a Delaware corporation ("NextG"). RECITALS A. NextG owns, maintains, operates and controls, in accordance with regulations promulgated by the Federal Communications Commission and the California Public Utilities Commission (PUC), a fiber -based telecommunications Network (as defined in Section 1.9 below) serving NextG's wireless carrier customers and using microcellular optical repeater Equipment (as defined in Section 1.4 below) certified by the Federal Communications Commission. B. NextG holds a valid and unrevoked certificate of public convenience and necessity (CPCN) that was issued by the California Public Utilities Commission in its Decision No. 03-01-061 that became effective on January 30, 2003. Since its initial issuance of a CPCN, NextG applied for and was issued a full facilities -based CPCN by the PUC in its decision No. 07-04-045 that became effective on April 12, 2007. This certificate recites NextG's authority to partake in construction activities consistent with the decision and CPCN U -6745-C. C. For the purpose of operating the Network and improving wireless coverage and capacity in the City, NextG wishes to locate, place, attach, install, operate, control, and maintain Equipment in the Public Way (as defined in Section 1.11 below) on facilities owned by the City and by third parties. D. The Public Ways within the City are used by and useful to private enterprises engaged in providing telecommunications services to residents, institutions, and businesses located in the City. E. The right to occupy portions of the Public Ways upon City -owned infrastructure for limited times, for the business of providing telecommunications services, is a valuable economic privilege, the economic benefit of which should be shared with all taxpayers of the City. F. Beneficial competition between providers of communications services can be furthered by the City's provision of grants of location and rights to use the Public Ways on nondiscriminatory and competitively neutral terms and conditions. G. NextG is willing to compensate the City in exchange for a grant of location and the right to use and physically occupy portions of the Public Way. 11236-0001 A 066087v2 CITY OF SANTA CLARITA 2-15-11 AGREEMENT For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree to the following covenants, terms, and conditions: 1. DEFINITIONS. The following definitions apply generally to the provisions of this Agreement: 1.1 "Adjusted Gross Revenues" means the gross dollar amount received by NextG for its Services (as defined in Section 1.13 below) provided to wireless carrier customers, which Services are attributable to Equipment located within the City, excluding (i) the Right -of - Way Use Fee, if any, payable pursuant to Section 4.2 et sec . below and any utility users tax, communications tax, or similar tax or fee paid to City; (ii) local, state, or federal taxes that have been billed to the customers and separately stated on customers' bills; and (iii) revenue uncollectible from customers (i.e., bad debts) for Services provided in the City, which revenue was previously included in Gross Revenues. 1.2 "City" means the City of Santa Clarita, California. 1.3 "Decorative Streetlight Pole" means any streetlight pole that incorporates artistic design elements not typically found in standard steel or aluminum streetlight poles, and that does not have a mast arm for electrolier support. 1.4 "Equipment" means the optical repeaters, DWDM and CWDM multiplexers, antennas, fiber optic cables, wires, and related equipment, whether referred to singly or collectively, to be installed and operated by NextG. Examples of typical Equipment types and installation configurations that have been pre -approved by the City are shown in the drawings and photographs attached as Exhibit A and incorporated by this reference. Any Equipment type and installation configuration not contained in Exhibit A must receive prior written approval from the City before it may be installed on any Municipal Facility or placed on or in the Public Way. 1.5 "Fee" means any assessment, license, charge, fee, imposition, tax, or levy of general application upon entities doing business in the City lawfully imposed by any governmental body (but excluding any utility users tax, franchise.fees, communications tax, or similar tax or fee). 1.6 "Installation Date" means the date that any Equipment is first installed by NextG pursuant to this Agreement and is inspected and approved by City in accordance with its customary permitting procedures. 1.7 "Laws" means statutes, constitutions, ordinances, resolutions, regulations, judicial decisions, rules, tariffs, administrative orders, certificates, orders, or other requirements of the City or other governmental agency having joint or several jurisdiction over the parties to this Agreement. 2 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 1.8 "Municipal Facilities" means City -owned streetlight poles, decorative streetlight poles, lighting fixtures, electroliers, fiber-optic strands and conduit, or other City - owned structures located within the Public Way. These facilities may be referred to in the singular or plural, as appropriate to the context in which used. 1.9 "Network" or collectively "Networks" means one or more of the neutral - host, protocol -agnostic, fiber -based optical repeater networks operated by NextG to serve its wireless carrier customers in the City. 1.10 "NextG" means NextG Networks of California, Inc., a corporation duly organized and existing under the laws of the State of Delaware, and its lawful successors, assigns, and transferees. 1.11 "Public Way" or "Public Rights -of -Way" means the space in, upon, above, along, across, and over the public streets, roads, lanes, courts, ways, alleys, boulevards, sidewalks, bicycle lanes, and places, including all public utility easements and public service easements as the same now or may hereafter exist, that are under the jurisdiction of the City. This term does not include county, state, or federal rights-of-way or any property owned by any person or entity other than the City, except as provided by applicable laws or pursuant to an agreement between the City and any such person or entity. 1.12 "PUC" means the California Public Utilities Commission. 1.13 "Services" means the radio frequency ("RF") transport telecommunications services provided through the Network by NextG to its wireless carrier customers pursuant to one or more tariffs filed with and regulated by the PUC. 1.14 "Streetlight Pole" means any standard -design concrete, fiberglass, metal, or wooden pole that has a mast arm for electrolier support and is used for streetlighting purposes. 2. TERM. This Agreement is effective on the Effective Date as specified in Section 12.11 and will be for a term of ten (10) years commencing on the Installation Date, unless earlier terminated by either party in accordance with the provisions of Section 10. Within six months prior to the expiration of the initial 10 -year term, and upon NextG's written request, the parties will meet and confer with regard to a five-year renewal or extension of this Agreement, and the terms and conditions applicable to any such renewal or extension. 3. SCOPE OF USE AGREEMENT. All rights'expressly granted to NextG under this Agreement, which will be exercised at NextG's sole cost and expense, are subject to the prior and continuing right of the City under applicable laws to use all parts of the Public Way exclusively or concurrently with any other person or entity and are further subject to all deeds, easements, dedications, conditions, covenants, restrictions, encumbrances, and claims of title of record that may affect the Public Way. Nothing in this Agreement may be deemed to grant, convey, create, or vest in NextG a real property interest in land, including any fee, leasehold interest, or easement. All work performed pursuant to the rights granted by this Agreement is 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 5 subject to the prior review and approval of the City in accordance with its customary permitting procedures. 3.1 Attachment to Municipal Facilities. The City authorizes NextG to enter upon the Public Way and to locate, place, attach, install, operate, maintain, control, remove, reattach, reinstall, relocate, and replace Equipment in or on Municipal Facilities for the purposes of operating the Network and providing Services. In addition, subject to the provisions of Section 4.2 below, NextG has the right, at NextG's expense, to draw electricity for the operation of the Equipment from the power source associated with each such attachment to Municipal Facilities. A denial of an application for the attachment of Equipment to Municipal Facilities shall not be based upon the size, quantity, shape, color, weight, configuration, or other physical properties of NextG's Equipment if the Equipment identified in that application substantially conforms to one of the approved configurations and the Equipment specifications set forth in Exhibit A. Notwithstanding anything to the contrary herein, attachment to Decorative Streetlight Poles is discretionary and subject to the City's reasonable approval in each instance. In addition, City may authorize NextG to use City -owned conduit for the purposes of operating the Network and providing Services, if such conduit becomes available and such use is authorized by NextG's certificate of public convenience and necessity. 3.2 Attachment to Third -Party Property. Subject to obtaining written permission from the owner of the affected property, City authorizes NextG to enter upon the Public Way and to attach, install, operate, maintain, remove, reattach, reinstall, relocate, and replace such items of Equipment in or on poles or other structures owned by public utility companies or other property owners located within the Public Way as may be permitted by the public utility company or property owner. NextG must furnish to the City documentation of that permission from the individual utility or property owner. The denial of an application for the attachment of Equipment to third -party -owned poles or structures in the Public Way will not be based upon the size, quantity, shape, color, weight, configuration, or other physical properties of NextG's Equipment if the Equipment identified in that application substantially conforms to one of the pre -approved configurations and the Equipment specifications set forth in Exhibit "A." 3.3 Preference for Municipal Facilities. In any circumstances where NextG has a choice of attaching its Equipment to either Municipal Facilities or to third -party -owned property in the Public Way, NextG agrees to attach to the Municipal Facilities, provided that (i) those Municipal Facilities are at least equally suitable functionally for the operation of the Network, and (ii) the rental fee and installation costs associated with that attachment over the length of the term ate equal to or less than the fee or cost to NextG of attaching to the alternative third -party -owned property. 3.4 No Interference. In the performance and exercise of its rights and obligations under this Agreement, NextG must not interfere in any manner with the existence and operation of any public or private rights-of-way, sanitary sewers, water mains, storm drains, gas mains, poles, aerial and underground electrical and telephone wires, electroliers, cable television and telecommunications facilities, utilities, or municipal property, without the express 4 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 a written approval of the owner or owners of the affected property or properties, except as authorized by applicable laws or this Agreement. 3.5 Compliance with Laws. NextG will comply with all applicable laws in the exercise of its rights and the performance of its obligations under this Agreement. 3.6 No Authorization to Provide Other Services. NextG represents that its Equipment installed pursuant to this Agreement will be used solely for the purpose of providing the Services identified herein and that NextG will not use its Equipment to offer or provide any other services except for those services referenced in Subsection 4.5. NextG's failure to comply with these limitations will constitute a material breach of this Agreement and City, after providing written notice to NextG, may levy monetary penalties in an amount not to exceed $1,000 per day from the date of noncompliance until the breach is cured. 4. COMPENSATION; UTILITY CHARGES. NextG is solely responsible for the payment of all lawful fees in connection with NextG's performance under this Agreement, including those set forth below. 4.1 Annual Fee. In order to compensate City for NextG's entry upon and deployment within the Public Way, and as compensation for the use of Municipal Facilities, NextG will pay to the City an annual fee (collectively the "Aggregate Annual Fee") that consists of the following: (i) A fee (the "Pole Fee") in the amount of Five Hundred Dollars ($500) for the use of each City -owned streetlight or traffic -signal pole, if any, upon which NextG's Equipment has been installed pursuant to this Agreement; and (ii) A fee (the "Conduit Fee"), in adamount equivalent to that charged by cities of similar size, per foot per annum for City -owned conduit, if any, that the City permits NextG to use hereunder. The Aggregate Annual Fee to be paid with respect to each year of the term will be an amount equal to (i) the number of Equipment installations made on Municipal Facilities, or that continue to remain on Municipal Facilities, during the preceding 12 months multiplied by the annual Pole Fee, prorated as appropriate; and (ii) the annual Conduit Fee multiplied by the - number of City -owned conduit feet used by NextG during the preceding 12 months, prorated as appropriate. The Aggregate Annual Fee is due and payable not later than 45 days after each anniversary of the Installation Date. City represents that City owns all Municipal Facilities for the use of which it is collecting from NextG the Aggregate Annual Fee pursuant to this Section 4.1. 4.2 CPI Adjustment. Commencing on the fifth anniversary of the Installation Date and continuing on each fifth anniversary thereafter during the term, the fees for each component of the Aggregate Annual Fee for the ensuing five-year period will be adjusted by a percentage amount equal to the percentage change in the U.S. Department of Labor, Bureau 5 e 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 f of Labor Statistics Consumer Price Index (All Items, All Consumers, 1982 1984=100) that occurred during the previous five-year period for the Los Angeles -Riverside -Orange County Metropolitan Statistical Area. 4.3 Right -of -Way Use Fee. To further compensate City for NextG's entry upon and deployment of Equipment within the Public Way, NextG will pay to City, on an annual basis, an amount equal to five percent (5%) of Adjusted Gross Revenues (the "Right -of -Way Fee"). NextG must make payment of the Right -of -Way Fee that is due and owing within 45 days after the first anniversary of the Effective Date and within the same period after each subsequent anniversary of the Effective Date. Within 45 days after the termination of this Agreement, the Right -of -Way Fee will be paid for the period elapsing since the end of the last anniversary date for which the Right -of -Way Fee has been paid. NextG will furnish to City with each payment of the Right -of -Way Fee a statement, executed by an authorized officer of NextG, showing the amount of Adjusted Gross Revenues for the period covered by the payment. If NextG discovers any error in the amount of compensation due, the City will be paid within 30 days of discovery of the error or determination of the correct amount. Any overpayment to the City through error or otherwise will be offset against the next payment due. Acceptance by City of any payment of the Right -of -Way Fee will not be deemed a waiver by City of any breach of this Agreement occurring prior thereto, nor will the acceptance by City of any such payment preclude City from later establishing that a greater amount was actually due or from collecting any balance that is due. 4.4 Accounting Matters. NextG will maintain accurate books of account at its principal office in Milpitas, California or another location of its choosing, for the purpose of determining the amounts due to City under Sections 4.1 and 4.2 above. City, or a consultant acting on behalf of City, may inspect NextG's books of account relative to City at any time during regular business hours on 10 business days' prior written notice and may audit the books from time to time, but in each case only to the extent necessary to confirm the accuracy of payments due under Sections 4.1 and 4.2 above. The City agrees to hold in confidence any non- public information it obtains from NextG to the maximum extent permitted by law. 4.5 Services to City. NextG will at all times during the term of this Agreement reserve one wavelength of capacity in the fiber owned or operated by NextG in the City for the City's exclusive use in operating a noncommercial, City -owned Wi-Fi network, or for any other City -operated noncommercial data network or communications system. 4.6 Electricity Charges. NextG is solely responsible for the payment to the utility service provider of all electrical utility charges that are attributable to the Equipment's usage of electricity. 4.7 Delinquent Payment. If NextG fails to pay any amounts due under this Section 4 within 30 days from the specified due date, NextG must pay, in addition to the unpaid fees, a sum of money equal to one percent (I%) of the amount due for each month or fraction thereof during which the payment is due and unpaid. 4.8 "Most -Favored -Municipality" Status. The parties anticipate that, following the effective date of this Agreement, NextG will enter into similar right-of-way use 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 agreements with other municipalities. If NextG enters into a similar agreement with another municipality in the Los Angeles Metropolitan Statistical Area, which municipality has a population that is the same than that of the City, then the parties will modify this Agreement if the following conditions are met. (i) The right-of-way use agreement confers financial benefits upon the municipality that, taken as a whole and balanced with other terms of that agreement, are deemed by the City to be substantially superior to the financial benefits provided for in this Agreement; and (ii) City notifies NextG of its desire to modify this Agreement to substitute the same or substantially similar financial benefits, and related terms and conditions, of that right-of-way use agreement in order to achieve parity. To the extent practicable, such modification will be retroactive to the effective date of the similar right- of-way use agreement with the comparable municipality. Concurrently with NextG's annual payment of the right-of-way use fee provided for in Subsection 4.3, NextG will provide to the City a list of right-of-way use agreements that have been executed with municipalities within the Los Angeles Metropolitan Statistical Area during the preceding 12 -month period. 5. CONSTRUCTION. NextG must comply with all applicable federal, state, and City technical specifications and requirements and all applicable state and local codes related to the construction, installation, operation, maintenance, and control of NextG's Equipment installed in the Public Way and on Municipal Facilities in the City. NextG may not attach, install, maintain, or operate any Equipment in or on the Public Way or on Municipal Facilities without the City's prior written approval for each location. 5.1 Obtaining Required Permits. If the attachment, installation, operation, maintenance, or location of the Equipment in the Public Way requires any permits, NextG must, if required under applicable City ordinances, apply for the appropriate permits and pay all required standard permit and inspection fees. City will process NextG's applications for permits and will _otherwise cooperate with NextG in facilitating the deployment of the Network in the Public Way in a reasonable and timely manner. 5.2 Location of Equipment. The proposed locations of NextG's planned initial installation of Equipment will be provided to the City promptly after NextG's review of available street light maps and prior to any deployment of the Equipment. Prior to installation of the Equipment in the Public Way or upon any Municipal Facility, NextG must obtain the City's prior written approval. The City may.approve or disapprove a location and installation, based upon reasonable regulatory factors, including but not limited to the location of other existing, or planned and approved but not yet constructed communications facilities, efficient use of scarce physical space to avoid premature exhaustion, potential interference with other communications facilities and services to the extent not preempted by federal law, and public safety considerations; provided however, that City's approval will not be unreasonably conditioned, delayed, or withheld. Upon the completion of each installation, NextG must promptly furnish to the City a current pole list and map that identifies the exact location of the Equipment in the 7 11236-000111066087v2 CITY OF SANTA CLARITA 2-15-11 Public Way. That information must be provided in a format that is compatible with City's information technology. 5.3 Relocation and Displacement of Equipment. NextG acknowledges that City may require NextG to relocate one or more of its Equipment installations. NextG will at City's direction relocate that Equipment, at NextG's sole cost and expense, whenever City reasonably determines that the relocation is needed for any of the following purposes: (a) if required for the -construction, completion, repair, relocation, or maintenance of a City project; (b) because the Equipment is interfering with or adversely affecting proper operation of City -owned light poles, traffic signals, or other Municipal Facilities; or (c) to protect or preserve the public health or safety. If NextG fails to relocate any Equipment as requested by the City within a reasonable time under the circumstances described above, City is entitled to relocate the Equipment at NextG's sole cost and expense, without further notice to NextG. To the extent City has actual knowledge thereof, the City will endeavor promptly to inform NextG of the displacement or removal of any pole on which any Equipment is located. 5.4 Relocations at NextG's Request. If NextG desires to relocate any Equipment from one Municipal Facility to another, NextG must so advise City. City will use reasonable efforts to accommodate NextG by making another reasonably equivalent Municipal Facility available for use in accordance with and subject to the terms and conditions of this Agreement. 5.5 Damage to Public Way. Whenever the removal or relocation of Equipment is required or permitted under this Agreement, and that removal or relocation causes the Public Way to be damaged, NextG, at its sole cost and expense, must promptly repair and return the Public Way in which the Equipment is located to a safe and satisfactory condition as directed by, and to the satisfaction of, the City Engineer. If NextG does not repair the site as required above, then City will have the option, upon 15 days' prior written notice to NextG, to perform or cause to be performed all reasonable and necessary work on behalf of NextG. City may charge NextG for all costs to be incurred, or the actual costs incurred by City, in the manner that City customarily determines costs if the work is performed by City, or at actual cost if the work is performed by a third party. Upon receipt of a demand for payment by City, NextG must promptly reimburse City for those costs. 6. INDEMNIFICATION AND WAIVER. NextG will indemnify, defend, protect, and hold harmless the City, its councilmembers, officers, employees, agents, and contractors, from and against liability, claims, demands, losses, damages, fines, charges, penalties, administrative and judicial proceedings and orders, judgments, and all costs and expenses incurred in connection therewith, including reasonable attorneys' fees and costs of defense (collectively, the "Losses") directly or proximately resulting from NextG's activities undertaken pursuant to this Agreement, except to the extent arising from or caused by the gross negligence or willful misconduct of the City, its councilmembers, officers, employees, agents, or contractors. 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 6.1 Waiver of Claims. NextG waives all claims, demands, causes of action, and rights it may assert against City on account of any loss, damage, or injury to any Equipment, or any Joss or degradation of the Services, resulting from any event or occurrence that is beyond the City's reasonable control. 6.2 Limitation of City's Liability. City will be liable only for the cost of repair to damaged Equipment arising from the sole negligence or willful misconduct of City, its employees, agents, or contractors, and City will in no event be liable for indirect or consequential damages. 7. INSURANCE. NextG must obtain and maintain during the term of this Agreement Commercial General Liability insurance and Commercial Automobile Liability insurance protecting NextG in an amount not less than One Million Dollars ($1,000,000) per occurrence (combined single limit), including bodily injury and property damage, and in an amount not less than Two Million Dollars ($2,000,000) annual aggregate for both personal injury liability and products -completed operations. The Commercial General Liability insurance policy must name the City, its councilmembers, officers, and employees as additional insureds as respects any covered liability arising out of NextG's performance of work under this Agreement. Coverage must be in an occurrence form and in accordance with the limits and provisions specified herein. Claims -made policies are not acceptable. This insurance must not be canceled, nor may the occurrence or aggregate limits set forth above be reduced, until the City has received at least 30 days' advance written notice of such cancellation or change. NextG is responsible for notifying the City of any change or cancellation. 7.1 Filing of Certificates and Endorsements. Prior to the commencement of any work pursuant to this Agreement, NextG must file with City the required original certificates of insurance with endorsements, which must state the following: (i) The policy number; name of insurance company; name and address of the agent or authorized representative; name and address of insured; project name; policy expiration date; and specific coverage amounts; (ii) That the City will receive not less than 30 days' prior notice of cancellation; (iii) That NextG's Commercial General Liability insurance policy is primary as respects any other valid or collectible insurance that City may possess, including any self insured retentions that City may have; and that any other insurance the City possesses will be considered excess insurance only and will not be required to contribute with this insurance; and (iv) That NextG's Commercial General Liability insurance policy waives any right of recovery the insurance company may have against the City. 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 The certificates of insurance with endorsements and notices must be mailed to the City at the address specified below in Section 9. 7.2 Workers' Compensation Insurance. NextG must obtain and maintain at all times during the term of this Agreement statutory workers' compensation and employer's liability insurance in an amount not less than One Million Dollars ($1,000,000) and must furnish to City a certificate showing proof of that coverage. 7.3 Insurer Criteria. All insurance policies obtained by NextG must be issued by companies that are admitted and licensed to do business in the State of California and that have a minimum rating assigned by A.M. Best & Company's Key Rating Guide of "A" Overall and a Financial Size Category of "X" (i.e., a size of $500,000,000 to $750,000,000 based on capital, surplus, and conditional reserves). Insurance policies and certificates issued by non - admitted insurance companies are not acceptable. 7.4 Severability of Interest. All deductibles or self-insured retentions must be stated on the certificates of insurance, which must be sent to and approved by City. "Severability of interest" or "separation of insureds" clauses must be made a part of the Commercial General Liability and Commercial Automobile Liability policies. 8. FAITHFUL PERFORMANCE BOND. In order to secure the performance of its obligations under this Agreement, NextG will provide the following security instrument to the City: 8.1 Faithful Performance Bond. Prior to the commencement of any work under this Agreement, NextG must provide a faithful performance bond running to the City, substantially in the form attached as Exhibit B, in the penal sum of not less than Two Thousand Five Hundred Dollars ($2,500) for each Municipal Facility upon which Equipment is to be installed pursuant to Section 5 of this Agreement, conditioned upon the faithful performance by NextG of all the terms and conditions of this Agreement and upon the further condition that if NextG fails to comply with any law, ordinance, rule, or regulation governing this Agreement, there shall be recoverable jointly and severally from the principal and surety of the bond any damage or loss suffered, by the City as a result, including the full amount of any compensation, indemnification, or costs of removal or abandonment of NextG's property, plus costs and reasonable attorneys' fees up to the full amount of the faithful performance bond. The City may require NextG to increase the amount of the faithful performance bond if the City concludes that it is necessary to do so based upon the harm being caused by NextG to Public Ways or Municipal Facilities. NextG will keep the faithful performance bond in place during the term of this Agreement. 8.2 Assessment of the Bond. Upon NextG's failure to pay the City any amount owing under. this Agreement, the faithful performance bond may be assessed by the City for purposes including, but not limited to: 10 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 Q (i) Reimbursement of costs borne by the City to correct violations of the Agreement not corrected by NextG, after City provides notice and a reasonable opportunity to cure such violations. (ii) To provide monetary remedies or to satisfy damages assessed against NextG due to a material breach of this Agreement. 8.3 Restoration of the Bond. NextG must deposit a sum of money or a replacement instrument sufficient to restore the faithful performance bond to its original amount within 30 days after notice from the City that any amount has been recovered from the faithful performance bond. Failure to restore the bond to its full amount within 30 days will constitute a material breach of this Agreement. NextG will be relieved of the foregoing requirement to replenish the bond during the pendency of an appeal from the City's decision to draw on the faithful performance bond. 8.4 Costs of Collection. If the faithful performance bond is drawn upon, all of City's costs of collection and enforcement of the provisions relating to the bond that are specified in this section, including reasonable attorneys' fees and costs, will be paid by NextG. 8.5 Required Endorsement. The faithful performance bond is subject to the approval of the City Attorney and must contain the following endorsement: "This bond may not be canceled until sixty (60) days after receipt by the City Attorney, by registered mail, return receipt requested, of a written notice of intent to cancel or not to renew. " 8.6 Reservation of City Rights. The rights reserved by the City with respect to the faithful performance bond are in addition to all other rights and remedies the City may have under this Agreement or any other law. 9. NOTICES. All notices to be given pursuant to this Agreement must be in writing and delivered personally or transmitted (a) through the United States mail, by registered or certified mail, postage prepaid; (b) by means of prepaid overnight delivery service; or (c) by facsimile or email transmission, if a hardcopy of the same is followed by delivery through the U.S. mail or by overnight delivery service as described above, addressed as follows: If to City: CITY OF SANTA CLARITA Attn: Kenneth Pulskamp, City Manager 23920 Valencia Boulevard Santa Clarita, CA 91355 If to NextG: 11 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 \-5 NEXTG NETWORKS OF CALIFORNIA, INC. Attn: Contracts Administration 890 Tasman Road Milpitas, CA 95035-7439 9.1 Date of Notices; Changing Notice Recipient or Address. Notices will be deemed given upon receipt in the case of personal delivery, three days after deposit in the mail, or the next business day in the case of facsimile, email, or overnight delivery. Either party may from time to time designate any other recipient or address for this purpose by written notice to the other party delivered in the manner set forth above. 10. TERMINATION. This Agreement may be terminated by either party upon 45 days' prior written notice to the other party upon a default by the other party of any material covenant or term, which default is not cured within 45 days of receipt of written notice of default (or, if such default is not curable within 45 days, if the defaulting party fails to commence that cure within 45 days or fails thereafter diligently to prosecute such cure to completion); provided, that the grace period for any monetary default will be 10 days from receipt of notice. Except as expressly provided herein, the rights granted under this Agreement are irrevocable during its term. NextG shall remove the Equipment within 60 days of abandonment of the Equipment or termination of the Agreement, at NextG's sole cost and expense. If NextG fails to remove the Equipment, City is entitled to remove the Equipment at NextG's sole cost and expense, upon 30 days notice to NextG. 11. ASSIGNMENT. 11.1 Transactions Requiring City Consent. Consummation of the following transactions related to this Agreement, or involving NextG, requires the prior written consent of the City Council expressed by resolution, which consent will not be unreasonably withheld, conditioned, or delayed: (i) The sale, transfer, lease, assignment, or other disposition of this Agreement, in whole or in part, whether voluntary or involuntary; provided, however, that such consent is not required for a transaction that is exempt under the provisions of paragraph 11.2 below. A transfer, assignment, or other disposition of this Agreement may be made only by an instrument in writing, a duly executed copy of which must be filed in the office of the City Clerk after the consummation of that transfer, assignment, or other disposition. (ii) Any merger, consolidation, reorganization, business combination, or other transaction wherein or whereby 20 percent or more of the ownership interests in NextG, or in any parent company of NextG, will be affected and control of NextG will change or be subject to change. As used herein "control" means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of NextG. A duly executed copy of any written instrument evidencing the closing and consummation of any such transaction must be filed in the office of the City Clerk. 12 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 �A 11.2 Exempt Transactions. The requirements of paragraph 11.1 do not apply to the transfer of ownership interests in NextG to another business entity in the tier of business entities owned or controlled by NextG that (i) controls NextG; or (ii) is controlled by NextG; or (iii) is under common control with NextG; provided, however, that NextG must: (a) provide to City not less than 30 days prior written notice of that proposed transaction; (b) provide information concerning ownership and voting interests in the proposed transferee; (c) provide a list of officers, directors, and any new managing employees of the proposed transferee, and their telecommunications -related experience and expertise; (d) represent that the proposed transaction will have no foreseeable effect on the management and operation of the Project in the City's public rights-of-way; and (e) agree to execution by NextG and the proposed transferee of an assignment and assumption agreement, in form and substance acceptable to the City Attorney, whereby the proposed transferee assumes all of NextG's obligations under this Agreement and accepts its terms and conditions. 11.3 Notice. NextG must give to City at least 30 days' prior written notice (the "Exempted Transfer Notice") of any proposed Exempted Transfer and must set forth with specificity in that Exempted Transfer Notice the reasons why NextG believes the Exempted Transfer Criteria have been satisfied. The City will have a period of 30 days (the "Exempted Transfer Evaluation Period") from the date that NextG gives the City its Exempted Transfer Notice to object in writing to the adequacy of the information provided. Notwithstanding the foregoing, the Exempted Transfer Evaluation Period shall not be deemed to have commenced until the City has received from NextG all additional information the City may reasonably require in connection with its evaluation of the Exempted Transfer Criteria set forth in the Exempted Transfer Notice, so long as the City gives NextG notice in writing of the additional information the City requires within 15 days after the City's receipt of the original Exempted Transfer Notice. 12. MISCELLANEOUS PROVISIONS. The following provisions apply generally to the obligations of the parties under this Agreement. 12.1 Nonexclusive Use. NextG acknowledges that this Agreement does not provide NextG with exclusive use of the Public Way or any Municipal Facility and that City retains the right to permit other providers of communications services to install equipment or devices in the Public Way and on Municipal Facilities. City will make information available to other providers of communications services concerning the presence or planned deployment of NextG's Equipment in the Public Way or on Municipal Facilities. 12.2 Waiver of Breach. The waiver by either party of any breach or violation of any provision of this Agreement will not be deemed to be a waiver or a continuing waiver of any subsequent breach or violation of the same or any other provision of this Agreement. 12.3 Severability of Provisions. If any provision of this Agreement is held by court of competent jurisdiction in a final judicial action to be void, voidable, or unenforceable, that provision will be deemed to be severable from the remaining provisions of this Agreement and will not affect the legality, validity, or constitutionality of the remaining portions of this 13 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 \5 Agreement. Each party represents that it would have entered into this Agreement, and each of its provisions, regardless of whether any one or more provisions may be declared illegal, invalid, or unconstitutional. 12.4 Contacting NextG. NextG will be available to the employees of any City department having jurisdiction over NextG's activities 24 hours a day, seven days a week, regarding problems or complaints resulting from the attachment, installation, operation, maintenance, or removal of the Equipment. City may contact by telephone the network control center operator at telephone number 1-866-44-NEXTG (446-3984) regarding these problems or complaints. 12.5 Governing Law; Jurisdiction. This Agreement will be governed and construed by and in accordance with the laws of the State of California, without reference to its conflicts of law principles. If suit is brought by a party to this Agreement, the parties agree that trial of that action will be vested exclusively in the state courts of California, County of San Bernardino, or in the United States District Court for the Southern District of California. 12.6 Attorneys' Fees. If any dispute arising out of this Agreement results in litigation, the prevailing party will be entitled to recover its costs of suit, including (without limitation) reasonable attorneys' fees. 12.7 Consent Criteria. In any case where the approval or consent of a party is required, requested, or otherwise to be given under this Agreement, that party must not unreasonably delay, condition, or withhold its approval or consent. 12.8 Representations and Warranties. Each of the parties represents and warrants that it has the full right, power, legal capacity, and authority to enter into and perform its obligations hereunder and that those obligations will be binding upon that party without the approval or consent of any other person or entity, except as provided above in Section 3.3. 12.9 . Amendment of Agreement. This Agreement may be amended only by a written instrument signed by both parties. 12.10 Entire Agreement. This Agreement contains the entire understanding between the parties with respect to its subject matter. There are no representations, agreements, or understandings (whether oral or written) between or among the parties relating to the subject matter of this Agreement that are not fully expressed herein. 12.11 Effective Date. It is the intention of the parties that NextG will first execute this Agreement and then submit it to the City. The effective date will be the date on which this Agreement is executed on behalf of the City. The City Clerk will insert the effective date in the introductory paragraph of all counterparts of this Agreement, attest to their execution by a duly authorized officer of the City, and transmit one or more fully executed counterparts to NextG. 14 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 Ili TO EFFECTUATE THIS AGREEMENT, each of the parties has caused this Agreement to be executed by its duly authorized representative as of the date set forth below the authorized signature. APPROVED AS TO FORM: CITY OF SANTA CLARITA, a municipal corporation R-fi ATTEST: City Attorney Acting City Clerk APPROVED AS TO FORM: BE Title Date: NEXTG NETWORKS OF CALIFORNIA, INC., a Delaware corporation M. Corporate Counsel Title: 15 11236-0001\1066087v2 Date: CITY OF SANTA CLARITA 2-15-11 \rl EXHIBIT "A" PAGE 'l OF 2 U) z wL'i a a U. Zz a LU J inO h0 Fa- u 00 O OW I W z>- > a�o �Q o� o 0 LJ x z . UUz6. _ _.. .. m 3 LL. .-a UJ o 'tea en �� x0 za W- =W- Z- omz�m ZpV�U WZ < w x ria°Z ¢v�3w zx xzj z Nei 0 z to I I V— n0 l_L_ V I n0 L_L Al Zzo�ma , N W`(x in U C 09 � W H Z OO f - b a ro w N N 4 �/1 Cjw s O = N �' z z O 0Z O F Ln Q�U 3 (7 �zOJ LL C7 Z zQ �NoJ Z �Z U dYo v� U '. IRS z OHO zMlCLO� O W J w 0 7 O N EXHIBIT "A" LIZUR g� -PAGE 2 OF 2 z k r J z b Z w 4 V) Li z ' r Z I NmJ0 F•. fn� ¢ O = C) Q M m a Q ¢ a x'n II J Y Z¢"0o' Z ozLq < Q U I U v p W Z a O co �w WZX 11 II ~ W m .._U tD.laiL' a,' �t-7 x J F - z w F5 °O z �I Q Noo a m 0 0 O O � � r z z w _o 0 O N i a a o z a 5 Z uj z z q LLJZ o INm9mM w J (/ W L N JN Z J <>e to J IL Q. C) to H z l II II Z to W Zzx II II ¢ UU��i F �dUioW Z alxoxF Ld W HXX x Q m z 0 z W d 0 0 azty+ r O m W O ~ w Z � � Z O � O CL O � � o O N 0 p a cv o CL z N OW C7 �9 EXHIBIT B FAITHFUL PERFORMANCE BOND KNOW ALL MEN BY THESE PRESENTS: WHEREAS, the City of Santa Clarita, California, a municipal corporation ("City") and NextG Networks of California, Inc., a Delaware corporation, ("Principal") have entered into an agreement for the occupancy of portions of the public ways upon City -owned infrastructure; and WHEREAS, the agreement, identified as "Right of Way Use Agreement," is incorporated by this reference; and WHEREAS, Principal is required under the terms of the agreement to furnish a bond for its faithful performance; NOW, THEREFORE, We, Principal and , as Surety, are held and firmly bound unto the City in the penal sum of Dollars ($ ), lawful money of the United States, for the payment of which we bind ourselves, our heirs, successors, executors, administrators, jointly and severally, firmly by these presents. The condition of this obligation is such that the obligation will become null and void if the above -bounded Principal, his or its heirs, executors, administrators, successors, or assigns, will in all things stand to, abide by, well and truly keep and perform the covenants, conditions, and provisions in said agreement and any alteration thereof made as therein provided, on his or their part, to be kept and performed at the time and in the manner therein specified, and in all respects according to their true intent and meaning, and will indemnify and save harmless the City, its officers, agents, and employees, as therein stipulated; otherwise, this obligation will be and remain in full force and effect. As part of the obligation secured hereby, and in addition to the face amount specified, costs and reasonable expenses and fees will be included, including reasonable attorneys' fees, incurred by the City in successfully enforcing the obligation, all to be taxed as costs and included in any judgment rendered. The Surety hereby stipulates and agrees that no change, extension of time, alteration, or addition .to the terms of the agreement, the work authorized to be performed thereunder, or the specifications accompanying the agreement will in any manner affect its obligations on this bond. The Surety hereby waives notice of any such change, extension of time, alteration, or addition to the terms of the agreement, the work, or the specifications; provided; however, that this bond is subject to the following express conditions: 1. This bond shall be deemed continuous in form and shall remain in full force and effect until canceled under Subsection 10 of the agreement, after which all liability ceases, except as to any liability incurred or accrued prior to the date of such cancellation. B-1 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 WIN 2. The aggregate liability of the Surety hereunder on all claims shall not exceed the penal sum of this bond in any event. 3. The Surety reserves the right to withdraw as Surety from this bond, except as to any liability incurred or accrued, and may do so upon giving the City not less than sixty (60) days' written notice in accordance with Subsection 10 of the agreement. IN WITNESS WHEREOF, this instrument has been duly executed by the above-named Principal and Surety on , 2011. Note: All signatures must be acknowledged before a notary public. Attach appropriate acknowledgment. (Type name of Principal) (Type address of Principal) By: (Signature of authorized officer) (Title of officer) (Type name of Surety) (Type address of Surety) By: (Signature of authorized officer) (Title of officer) APPROVED AS TO FORM: CITY ATTORNEY B-2 11236-0001\1066087v2 CITY OF SANTA CLARITA 2-15-11 D\ Exhibit C Photograph of Installed NextG Antennae and Control Boxes on Streetlight and Traffic Signal Poles a� D3