DOCSOC/1775707v1/022017-0058
FIBER LEASE AGREEMENT
This Fiber Lease Agreement (“Agreement”) is made this 25th day of February 2025 by and between the City of Lancaster (the “City”), a California municipal corporation, and Race Communications, (“Lessee”), an Internet provider. The City and Lessee are referred to herein individually a “Party” or collectively the “Parties.”
RECITALS
A. As part of the City’s Network Program, the City has installed and is installing a fiber optic cable network including, without limitation, the City-Wide Traffic Fiber Network (collectively, the “City Fiber Network”) to satisfy its local private cloud service needs and to enhance the services it offers to its businesses and residents. A map showing the portion of the City Fiber Network to be leased hereunder is affixed hereto as Exhibit A and incorporated herein by reference (the “Map”).
B. The City desires to lease to Lessee the portion of the City Fiber Network shown on the Map.
NOW, THEREFORE, in light of the mutual promises and obligations contained herein, and in exchange for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the Parties, the Parties agree as follows:
1.Definitions.
The following words, terms, and phrases, when used in this Agreement, shall have the following meanings:
(a) “Fiber Access Facility” means City-owned outside plant cabinets, pedestals, conduits, inner-ducts, vaults, and other facilities through which the City uses, maintains, and repairs its fiber optic cable network.
(b) “Fiber Infrastructure” means the fiber optic cables, patch panels, patch cords, splice enclosures, or other connected elements of the fiber network. (c) “City Fiber Network” means Fiber Access Facility and Fiber Infrastructure as defined above and depicted in Exhibit A.
2.Lease of Lancaster City Fiber.
2.1Lease. The City hereby agrees that, in exchange for the payment of the Annual Fee, it will lease to Lessee that portion of the City Fiber Network shown in Exhibit A hereto.
2.2Sublicense. The City hereby grants to Lessee such rights to the City Fiber Network as may be reasonably necessary for Lessee to perform its obligations under this Agreement.
3.Payments.
3.1Annual Fee. In consideration of the lease of the City Fiber Network, Lessee shall pay annually the amount of three thousand and six hundred dollars ($ 3,600.00) (the “Annual 2 DOCSOC/1775707v1/022017-0058
Fee”). The first payment shall be due at the time of the execution of this Agreement. Subsequent payments of the Annual Fee shall be made on the anniversary of the date of execution of this Agreement.
3.2Government Charges. The City will pay, when due, any and all taxes, assessments, and governmental charges of any kind whatsoever lawfully levied or assessed and attributable to Lessee’s lease of the City Fiber Network. Lessee shall pay any taxes levied on it that are based on Lessee’s business profits.
4.Term and Termination.
4.1Term. The Term of this Agreement shall be three (3) years, commencing on the date that this Agreement is executed by the parties and ending at 11:59 p.m. on March, 1 2028 (the “Term”).
4.2Termination by Either Party. Either party may terminate this Agreement immediately upon written notice in the event that the other party commits a non-remediable material breach of this Agreement, or if the other party fails to cure any remediable material breach or provide a written plan of cure acceptable to the non-breaching party within 30 days of being notified in writing of such breach.
4.3Termination by LESSEE.
4.3.1 Reclassification of Lessee. By entering into this Agreement with the City, Lessee does not intend to be, and shall not be classified as, a telecommunications company, telecommunications carrier, telecommunications service or any other telecommunications entity, nor to come under the jurisdiction, or existing or future regulation, of any state or Federal regulatory agency as a telecommunications company, including, without limitation the Federal Communications Commission or the California Public Utility Commission. If, however, a proceeding is commenced in which it is sought to classify Lessee as a telecommunications company, City and Lessee shall cooperate with each other to determine whether and to what extent this Agreement can be amended to remove that classification. If the Agreement cannot be so amended or if there is no agreement as to such amendment, then Lessee may terminate this Agreement on five (5) days prior written notice to City.
4.3.2 Appropriation Failure. Lessee shall have the right to terminate this Agreement twelve (12) months following any failure of the City to appropriate such funds as may be reasonable or necessary for the City to perform its obligations under this Agreement.
4.4Rights upon Expiration or Termination of the Agreement. Upon the expiration or termination of this Agreement, Lessee’s rights to the City Fiber Network shall terminate and the City Fiber Network shall revert to the City. Upon expiration or termination of this Agreement, Lessee shall have no continuing rights or obligations hereunder, except that any uncured defaults or any other obligations that are stipulated in this Agreement on the part of either party shall survive the expiration or termination of this Agreement. Any and all equipment furnished or supplied by Lessee to the City in connection with this Agreement shall remain the property of Lessee. Any and all equipment furnished or supplied by the City under this Agreement shall remain the property of the City.
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5.Permitted Use.
5.1Not a Franchise Agreement. This Agreement is not a franchise agreement under applicable law.
5.2No Title to City Fiber Network. This Agreement shall not convey to Lessee title, equitable or legal, in any property of the City, including the City Fiber Network, or the City’s public rights of way, and shall only give to Lessee the right to use the City Fiber Network for the purposes and for the period of time stated in this Lease Agreement.
6.Maintenance, Repair, and Capital Improvement.
6.1City Roles and Responsibilities. The City shall be solely responsible, at its own expense, for the construction, installation, operation, maintenance, and repair of the City Fiber Network. In the event of a disruption in service, Lessee shall inform the City of any disruption and the City shall begin restoration activities as soon as practicable after the City becomes aware of such disruption. The City shall provide, at its expense, commercial power to Fiber Access Facilities as necessary for the operation of the City Fiber Network.
6.2Lessee Roles and Responsibilities. Lessee shall be responsible, at its own expense, for the maintenance of the City Fiber Network. Lessee shall maintain Fiber Infrastructure design and inventory records. Lessee shall monitor the connectivity status and optical power levels as required for normal operation, construction, or repair activities. In the event of a disruption in service, Lessee shall have the right to perform such actions it deems necessary to restore service.
6.3Replacement. If at any point during the Term, any of the City Fiber Network is required to be repaired or replaced, as reasonably determined by Lessee or pursuant to the requirements of any governmental entity, the City shall make such repairs or replacements at the sole cost and expense of the City. The City’s obligations under this Section 6.3 shall include constructing any and all improvements to the City’s facilities necessary to physically accommodate the repairs or replacements and to maintain electrical and operating safety standards and fiber circuit continuity. Lessee shall perform, any engineering, cable installation, splicing, material procurement, installation and testing required to complete the installation of the fiber optic cable using City specifications and subject to Lessee’s approval. City shall assign a project engineer as a point of contact for all necessary approvals and will assign construction inspectors for review of all construction activities to assure compliance with approved designs.
6.4Capital Investment and Improvement. Lessee shall advise the City of any capital upgrades which may be required to enable the City Fiber Network to operate consistent with the needs of the City and its businesses and residents. Any request by Lessee for capital upgrades shall be reviewed by the City.
6.5Approvals. The City shall be responsible for obtaining and maintaining from the appropriate public or private authority any agreements, franchises, licenses, easements, state, local or right-of-way permits, or other authorizations required to operate and maintain the City Fiber Network and to maintain, and enter upon any property where any of the City Fiber Network is located. Lessee will not engage in any activity which affects the City’s right of way interests without the written permission of the City.
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6.6City Approvals. Lessee shall have the right to access the City Fiber Network as Lessee may deem appropriate to perform its obligations or exercise its rights under this Agreement.
6.7Damages. If Lessee learns that any of the City Fiber Network is damaged, Lessee shall notify the City as soon as practical. Such notice by Lessee shall provide the following information:
(i)Location reporting problem.
(ii)Name of contact person reporting problem.
(iii)Description of the problem in as much detail as possible. (iv)Time and date the problem occurred or began.
(v)State whether the problem presents a jeopardy situation to the City Fiber Network.
6.8Claims. The City and Lessee shall promptly advise the other in writing of any known claim or demand against Lessee or the City related to or arising out of Lessee’s activities under this Agreement.
7.Limitation of Liability.
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR LOST PROFITS, SPECIAL,
INCIDENTAL, PUNITIVE, EXEMPLARY, OR CONSEQUENTIAL DAMAGES, INCLUDING
BUT NOT LIMITED TO FRUSTRATION OF ECONOMIC OR BUSINESS EXPECTATIONS,
LOSS OF PROFITS, LOSS OF CAPITAL, COST OF SUBSTITUTE PRODUCT(S), FACILITIES,
OR SERVICES, OR DOWN TIME COSTS, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
8.Miscellaneous
8.1Personal Immunity. No personal recourse shall be had for any claim arising out of or relating to this Agreement, nor for any representation, obligation, covenant, or agreement set forth in this Agreement, against any past, present, or future officer, member, employee, or agent of either party, under any rule of law or equity, any statute or constitution, or by the enforcement of any assessment or penalty, or otherwise, and any liability of any such officer, member, employee, or agent is hereby expressly waived and released by each of the parties as a condition of and in consideration for the execution of this Agreement.
8.2Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed to have been duly given or made (i) the second business day after the date of mailing, if delivered by registered or certified mail, postage prepaid; (ii) upon delivery, if sent by hand delivery; (iii) upon delivery, if sent by prepaid courier, with a record of receipt; or (iv) the next day after the date of dispatch, if sent by cable, telegram, facsimile or telecopy (with a copy simultaneously sent by registered or certified mail, postage prepaid, return receipt requested), to the parties at the following addresses:
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(i)if to City, to:
Trolis Niebla
City Manager
44933 Fern Ave
Lancaster, CA 93534
Email:[email protected]
with a required copy to:
Joe Haggard
Assistant Director of Finance and Information Technology 44933 Fern Ave
Lancaster, CA 93534
Email:[email protected]
(ii)if to LESSEE, to:
Attention:
Telecopy:
Email:
with a required copy to:
Attention:
Telecopy:
Email:
Any party hereto may change the address to which notice to it, or copies thereof, shall be addressed, by giving notice thereof to the other parties hereto in conformity with the foregoing.
8.3Assignment; Governing Law. This Agreement and all the rights and powers granted hereby shall bind and inure to the benefit of the parties hereto and their respective permitted successors and assigns. This Agreement and the rights, interests and obligations hereunder may not be assigned by any party hereto without the prior written consent of the other parties hereto. This Agreement shall be governed by the laws of the State of California.
8.4Amendment and Waiver; Cumulative Effect. To be effective, any amendment or waiver under this Agreement must be in writing and be signed by the party against whom enforcement of the same is sought. Neither the failure of any party hereto to exercise any right, power or remedy provided under this Agreement or to insist upon compliance by any other party with its obligations hereunder, nor any custom or practice of the parties at variance with the terms hereof shall constitute a waiver by such party of its right to exercise any such right, power or remedy or to demand such compliance. The rights and remedies of the parties hereto are 6 DOCSOC/1775707v1/022017-0058
cumulative and not exclusive of the rights and remedies that they otherwise might have now or hereafter, at law, in equity, by statute or otherwise.
8.5Entire Agreement; No Third Party Beneficiaries. This Agreement sets forth all of the promises, covenants, agreements, conditions and undertakings between the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements and understandings, negotiations, inducements or conditions, express or implied, oral or written. This Agreement is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder.
8.6Severability. If any term or other provision of this Agreement is held by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced under any rule of law in any particular respect or under any particular circumstances, such term or provision shall nevertheless remain in full force and effect in all other respects and under all other circumstances, and all other terms, conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner, to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.
8.7Dispute Resolution.
(a) City and Lessee agree that, prior to commencing any litigation against the other concerning any matter arising out of or relating to this Agreement, City and Lessee shall meet in a timely manner and attempt in good faith to negotiate a settlement of such dispute. (b) In the event that the parties are unable to resolve any dispute amicably within thirty (30) days after a party gives notice of the dispute to the other party, the parties may pursue all available remedies at law or in equity. Venue for any action to enforce the terms of this Agreement shall be in Los Angeles Superior Court.
8.8Counterparts. The parties may execute this Agreement in any number of counterparts, each of which shall be an original, and all of which together shall constitute one instrument. A signature by facsimile machine or the transmission of a scanned signature shall bind the party so signing with the same effect as the party’s original signature. Each party who transmits a copy of the party’s signed signature page agrees to simultaneously forward an original or duplicate original signature page by mail or personal delivery, although failure to do so shall not affect the validity of this Agreement.
8.9Authorization. Each of the persons executing this Agreement, in behalf of the respective parties, represents and warrants that he or she has the authority to bind the party in behalf of whom he or she has executed this Agreement, and that all acts required and necessary for authorization to enter into and to execute this Agreement have been completed.
IN WITNESS WHEREOF, the undersigned have caused this Fiber Lease Agreement to be executed as of the date noted above.
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“LESSEE”
____________,
a ____________
By:
“City”
City of Lancaster,
a California municipal corporation
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EXHIBIT A