HomeMy WebLinkAbout14 District Fiber Agenda Item ## 14
TRUCKEE DONNER
CTION
To: Board of Directors
From: Stephen Hollabaugh
Date: December 07, 2011
Subject: Consideration of Actions Related to the District Fib
er Asset:
a) Consideration of a Settlement Agreement with AT&T
b) Consideration of a Contract for the Sale of the District Fiber Asset
1. WHY THIS MATTER IS BEFORE THE BOARD
The purpose of this memorandum is to provide the Board with an update
long haul fiber assets and request authorization pate on the District's
q zation to approve the Settlement Agreement and
Mutual Release with AT&T and approve the Assignment and Assumption
Agreement with Electric Li ghtwave LLC. pt on and Assumption
2. HISTORY
A Workshop was presented at the November 16, 2011 that provided
District's long haul fiber assets and the statusP ed an update on the
of efforts to sell this asset.
3. NEW INFORMATION
AT&T and the District Dispute:
A dispute arose between AT&T and the District over the Agreements
proper location of the end-points of the dark fiber in Reng ments arising out of the
o and Sacramento and both
parties made numerous claims and arguments related to this dispute.pute.
• AT&T and the District
(the Parties) agreed to mediate the Dispute with the
assistance of Honorable Judge James R. Trembath (retired).
The District and � }• AT&T have negotiated a Settlement Agreement (Attachment
to the Dispute where the basic details are. 1)
• AT&T consented to the District's assignment of all of its
htwav rights, privileges
and obligations to Electric Li
g e, LLC DELI},
• AT&T assured to provision the fiber strands to ELI a
locations in Reno, NV and Sacramento, CA, t certain specified
• ELI has agreed to accept the assignment of District and
privileges and obligations under the AT&T/Di strict Agreements; and
• ELI agrees to comply with all of AT&T's requirements f
equipment usage necessaryto r q or collocation and
for ELI. provision the fibers at the specific location
Assi nment and Assumption A reement between the District and ELI (Attachment 2
District a ( )'
r• gees to transfer all interest in the long haul dark fiber(fiber) to ELI for
a sum of one million one hundred thousand dollars ($1,100,000)
• ELI desires to assume the Dark Fiber IRU Agreement between AT&T and the
e
• ELI shall assume annual payment obligations to AT&T of $13,333.33 annual)
from 2012 through 2022 for a present value PV of$123 368. y
4. FISCAL IMPACT
The total value of this transaction to the District is $1,223,368
• $1,100,000 lump sum payment
• Present value of the avoided cost to AT&T is $123,368
• District Counsel has reviewed the Settlement Agreement, and the Assignment
and Assumption Agreement 9 ent
5. RECOMMENDATION
a) Approve and authorize the Board President to sign the Settlement Agreement
Mutual Release between Truckee Donner Public Utility District g Bement and
and AT&T in
substantially the form presented and approved by District Counsel.
b) Approve and authorize the Board President to sign the Assignment
htwa g and Assumption
Agreement between Electric Li
g ve, LLC and Truckee Donner Public Utility
District in substantially the form presented and approved b District Counsel.
unsel.
T
Stephen Hollabaugh
Assistant General Manager Michael D. Holley
General Manager
Attachment 1
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
THIS SETTLEMENT AGREEMENT AND MUTUAL RELEASE(hereinafter
"SettlementAgreement") is made and entered into this day of December, 2011
("Effective Date"),by and between Truckee-Donner Public Utility District, a California local
public agency("District"), and AT&T Corp., a New York corporation("AT&T"). The District
and AT&T may be referred to herein individually as "Party"or collectively as "Parties" as the
context requires.
RECITALS
A. Whereas, on July 16, 2003, the District entered into a Dark Fiber IRU Agreement
("Dark Fiber IRU Agreement")with Sierra Pacific Communications, a Nevada
limited liability company("SPC"), whereby the District acquired an indefeasible right
of use("IRU") in four(4) strands of dark fiber extending from Reno, Nevada to
Sacramento, California; and
B. Whereas,pursuantto the Dark Fiber IRU Agreement, the District and SPC agreed to
the requirements and procedures set forth in the Maintenance Specifications and
Procedures ("Maintenance Agreement"), `which, among other things, describes the
maintenance activities that must be performed on the strands of dark fiber and
provides for payment by the District to SPC for maintenance services; and
C. Whereas,on July 16, 2003, the District entered into a Conduit Purchase and Sale
Agreement with SPC, whereby SPC acquired from the District 16.5 miles of conduit
running from the eastern to western border of the City of Truckee, California
("Conduit Purchase and Sale Agreement"); and
D. Whereas, there is no dispute between the Parties that, AT&T is the successor-in-
interest to SPC with respect to the Dark Fiber IRUAgreement, the Maintenance
Agreement and the Conduit Purchase and Sale Agreement(collectively, the
"AT&T/District Agreements") attached hereto as Exhibit E; and
Page 1
{00232764.DOC 2}
E. Whereas, a dispute arose between the Parties over these Agreements arising out ofthe
proper locations of the endpoints of the dark fiber in Reno,Nevada and Sacramento,
California, and both parties made numerous claims and arguments related to this
dispute, including the provision of the facility, the timeliness of such provisioning,
and the respective responsibilities (the"Dispute"); and
F. Whereas, the Parties agreed to mediate the Dispute with the assistance of the
Honorable Judge James R. Trembath(retired); and
G. Whereas, the District and AT&T have negotiated a settlement of the Dispute; and,
H. Whereas, as part of the settlement, the District has requested that AT&T consent to
the District's assignment of all of its rights,privileges and obligations in and to the
AT&T/District Agreements to Electric Lightwave, LLC, a Delaware limited liability
company. ("ELI"), and that AT&Tprovision the fiber strands to ELI at certain
specified locations in Reno, Nevada and Sacramento, CA; and points in between as
specified in Schedule A to the Dark Fiber IRU Agreement.
I. whereas, AT&T has agreed to accept the assignment of all of District's rights,
privileges and obligations in and to the AT&TDistrict Agreementsto ELI as
evidenced by its execution of the Consent to Assignment and Estoppel Certificate
attached hereto as Exhibit C and to provision the fiber strands to ELI at certain
specified locations in Reno, Nevada and Sacramento, CA, andcertain specified
locations between Reno, Nevada and Sacramento, CA.
J. Whereas, pursuant to that certain Assumption and Assignment Agreement effective
upon the execution of this Settlement Agreement, and attached as Exhibit DELI has
agreed that it will accept the assignment of District and assume all of District'srights,
privileges and obligations under the AT&T/District Agreements; and
K. Whereas, ELI has entered into a IRU Fiber Space license Agreement with AT&T for
collocation and equipment usage necessary to provision the fibers at the specific
locations for ELI; and
Page 2
f 00232764.DOC 2 1
L. Whereas, the Parties desire to formalize the terms and conditions of such settlement
by entering into this Settlement Agreement.
NOW, THEREFORE, in consideration of the mutual covenants, promises and representations set
forth herein and for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties agree as follows:
1. Settlement Terms. In consideration of the agreements set forth herein, the Parties
have agreed, as of the Effective Date as follows:
a. The Parties agree to amend the Dark Fiber IRU Agreement as follows:
i. Section 1.5.1 is amended to state in its entirety: "Long Haul Dark Fiber
means four(4) continuous strands of Dark Fiber installed within Fiber
Owner's Fiber Optic Facilities beginning at an AT&Tjunction splice
located near 200 South Virginia Street, Reno,Nevada, continuing through
the Truckee, Blue Canyon and Auburn amplification sites and terminating
at ELI's LGX panel on the 8th floor of AT&T's POP site located at 1423 J
Street, Sacramento California as more precisely set forth in Schedule A,
Route Description. Such Dark Fiber has been installed and is being
maintained precisely as specified in Schedule A, Route Description,
Schedule B, Fiber Cable Splicing, Testing, and Acceptance Procedures
and Schedule C, Maintenance Specifications and Procedures.
ii. Section 5.3 is added to read as follows:"After the end of the
Term,including all extension periods(Second Term and Third Term), in
Section 5.1 , District's assignee ELI may receive, upon written request to
AT&T,a license to continue to use the Long Haul Dark Fiber strands for a
period not to exceed five(5) years; PROVIDED, HOWEVER, that the
Dark Fiber IRU Agreement and Maintenance Agreement shall terminate
prior to or at the time of AT&T's grant of the license and during the
license period of up to five (5) years(1)AT&T shall not be responsible in
any matter to maintain, upgrade, or provide any repair to the strands of
Page 3
{00232764.DOC 2}
fiber in the Long Haul Dark Fiber; (2)AT&T shall not in any way
guarantee or be responsible for the operability of the Long Haul Dark
Fiber; and, (3)upon the operational failure of any strand of the Long Haul
Dark Fiber, the license shall terminate as to that strand, and if all four
fibers fail, the license in its totality shall be immediately terminated.
iii. Section 6 is amended to state in its entirety:
FIBER OWNER shall maintain CUSTOMER's Strands in accordance with the requirements and
procedures set forth in Schedule C (Maintenance Specifications and Procedures"). CUSTOMER
shall cooperate with and assist, as many be reasonably required, FIBER OWNER in performing
said maintenance.
iv. Schedule A. Route Description is amended to state in its entirety,
"• Originates at Manhole MH 9-003Rin front of 200 South Virginia Street,
Reno,NV;
• Runs approximately 28 miles west to Hirschdale regeneration site(hard
splice or patch panel jumper patches);
• Runs approximately 10 miles west to manhole located in front of Truckee
Donner PUD offices located at 11570 Donner Pass Road, Truckee,
California, 96161 (hard splices or through fibers);
• Runs approximately 43 miles to Blue Canyon regeneration site(to be
delivered on existing patch panels pursuant to the Collocation Agreement
between AT&T and ELI("Collocation Agreement"), a copy of which is
attached hereto and referenced herein as Exhibit A;
• Runs approximately 39 miles to Auburn regeneration site(hard splice or
patch panel jumper patches);
• Runs approximately 40 miles and terminates at ELI's LGX panel on the 8th
floor of AT&T's POP located at 1423 "J" St., Sacramento, California, where
the fiber would bedelivered inside ELI's LGX panel Such termination point
shall be created by, subject to, and governed by the terms and conditions
ofthe Common Interface Agreement between AT&T and ELI ("CIA
Agreement"), a copy of which is attached hereto and referenced herein
asExhibit B; PROVIDED, HOWEVER, that AT&T shall not impose the
one-time charge for the initial installation The initial installation charge
shall only be imposed for the purpose of this Settlement Agreement only,
and this one-time exception will not entitle the District or y
ELI to waiver of
any charges for any reason in the future nor may it be interpreted as a waiver
of AT&T's rights to impose such charges.
b. AT&T hereby consents to District's Assignment of the AT&T/District
Agreements, including the applicable schedulesand exhibits to such agreements
to ELI pursuant to Section 19.2 of the Dark Fiber IRU Agreement, so long as and
Page 4
(00232764.DOC 2}
only to the extent that(1) such assignment is effective after the mutual execution
of this Settlement Agreement, so that ELI receives the rights,privileges, and
obligations of the Dark Fiber IRU Agreement as amended in this Settlement
Agreement, the Maintenance Agreement andConduit Purchase and Sale
AgreementThe District specifically agrees to indemnify, defend and hold
harmless AT&T from and against any and all injury, loss, damage, or liability(or
claims arising from or relating to any injury, loss, damage, or liability) costs or
expenses (including attorneys' fees and court costs) that may arise from any
claim, demand, litigation, action, or threat of action by ELI based on any claim
arising under or as a result of the AT&T/District Agreements, this Settlement
Agreement, and/or all other transactions and agreements taking place as a result
of this Settlement Agreement.
C. [
2. Mutual Release of Claims: Except for the duties created by this Settlement
Agreement, each of the Parties with respect to the otherParty, on their own behalf and on behalf
of their respective predecessors, successors and assignees, insurers, agents, employees, directors,
,
officers, owners,partners, shareholders, members, attorneys, corporate affiliates,parents,
subsidiaries, and all other affiliates, hereby release and forever discharge each other and each
other's predecessors, successors and assignees, insurers, agents, employees, directors officers
owners,partners, shareholders, members, attorneys, corporate affiliates,parents, subsidiaries,
and all other affiliates, and each of them, from any and all claims, debts, actions, demands
liabilities, obligations and causes of action, of whatever kind or nature arising prior to the date
hereof, which they may have, hold, or may hold in the future, whether known or unknown
suspected or unsuspected, liquidated or unliquidated, asserted or not asserted, in law or
equitythatrelate to or arise from the Dispute(collectively, the"Released Claims").This mutual
release shall survive the termination of thisSettlement Agreement.
3. Civil Code § 1542 Waiver. Except as set forth above, the Parties forever waive
any and all benefits and rights they may have, now hold or in the future may hold that concern
arise from or relate to the Released Claims by reason of California Civil Code Section 1542
which provides:
Page 5
(00232764.DOC 2 1
"A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the release,
which if known by him must have materially affected his settlement with the
debtor."
The Parties understand that if the facts giving rise to this Settlement Agreement are found
later to be other than or different from the facts now believed by them to be true, or if new facts
come to the attention of the Parties, or either of them, they accept and assume the risk of such
possible difference in the facts and agree that the releases mutually agreed to above shall be and will
remain effective, notwithstanding such different or new facts.
4. Representations and Warranties.Except for the Assignment from District to ELI
referenced above, the Parties represent to each other,that as of the Effective Date, they have not
assigned,transferred, conveyed or otherwise disposed of any interest in or arising from the
Dispute or related to the subject matter thereof, and that the individuals signing this Settlement
Agreement for the entity parties have full authority to do so and to thereby bind all persons and
entities referenced in Paragraph 2 above who are being released therein.
5. Miscellaneous.
(a) Knowledge and Consent of Parties. Each of the Parties warrants and
represents to the other that such Party has read and understands this Settlement Agreement, and
has been represented by counsel of his,her or its own choice in the negotiation and re aration
p p
of this Settlement Agreement and that this Settlement Agreement is executed voluntarily and
without duress or undue influence on the part of, or on behalf of, any of the Parties.
(b) Entire Agreement. This Settlement Agreement contains the entire
agreement and understanding between the Parties with respect to the entire subject matter of this
Settlement Agreement, and any and all prior, related discussions, negotiations, representations,
p ,
commitments and understandings are merged into this Settlement Agreement. No
representations, oral or otherwise, express or implied, other than those written and contained
herein have been made or relied upon by any of the Parties.
(c) Waiver. Modification and Amendment. No provision of this Settlement
Agreement may be waived or modified unless in writing signed by all Parties and only with a
specific written reference to this Settlement Agreement. The Parties further agree that a waiver
Page 6
f 00232764.DOC 2}
of any term or condition of this Settlement Agreement will not be deemed to be, and may not be
construed as, a waiver of any other term or condition hereof.
(d) Sever ability. If any provision of this Settlement Agreement is held invalid
or unenforceable, the remainder shall not be affected unless such holding deprives one of the
Parties of a material and substantial benefit of this Settlement Agreement.
(e) Subsequent Execution of Documents and Other Acts. The Parties agree to
execute all documents and to take all responsible actions (directly and through their attorneys)
which are necessary or helpful to effectuate the purposes of this Settlement Agreement.
(f) Collaborative Drafting. Neither this Settlement Agreement, nor any
provision within it, shall be construed against any Party or its attorney because it was drafted in
full or in part by any Party or its attorney.
(g) Execution. This Settlement Agreement may be executed in one or more
counterparts. The signature pages of the various counterparts may be collected with one copy of
the balance of the Settlement Agreement, which, together with all collected and signed signature
pages, shall constitute a true and correct copy of this Settlement Agreement. Photocopies or
telecopies or electronically transmitted images of this Settlement Agreement(including signature
ature
pages)may be used in place of originals for any and all purposes.
(h) Titles and Captions. Paragraph titles or captions contained in this
Settlement Agreement are inserted only as a matter of convenience and for reference and in no
way define, limit, extend or describe the scope of this Settlement Agreement or any provision
within it.
(i) No Admissions. The Parties acknowledge and agree that nothing herein
contained, and no act of any Party, shall be treated in any way as an admission of liability on
behalf of such Party as to any claim, contention or cause of action in any court or other
proceeding.
0) Governing Law. This Settlement Agreement shall be governed by, and
construed and enforced in accordance with, the internal substantive laws of the State of
California, without regard to principles of choice or conflicts of laws except for provisions
applying California substantive law and granting jurisdiction and venue to the courts of
California.
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f00232764.DOC 2}
(k) Attorneys' Fees and Costs.Should any Party commence an action to
enforce or interpret this Settlement Agreement, the prevailing Party therein shall be entitled to
recover its reasonable attorneys' fees and costs incurred therein.
IN WITNESS WHEREOF, the undersigned have executed this Settlement Agreement as
of the Effective Date first set forth above.
Truckee-Donner Public Utility District: AT&T Corp.:
Dated: Dated:
By: By
Michael Holley,
General Manager
Page 8
(00232764.DOC 2}
Exhibit "A"
Collocation Agreement
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J00232 764.DOC 2}
Exhibit "B"
Common Interface Agreement
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(00232 764.DOC 2}
Attachment 2
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement is executed on this day of
December 2011 (the "Effective Date"), by Electric Lightwave, LLC, a wholly-owned subsidiary
of Integra Telecom Holdings, Inc., ("ELI") and Truckee Donner Public Utility District
("Utility").
WITNESSETH:
WHEREAS, Utility desires to transfer to ELI, and ELI desires to assume from Utility, all
of Utility's rights and obligations under the Dark Fiber IRU Agreement as amended ("IRU
Agreement") dated July 16, 2003, between AT&T, Corp., AT&T Services, Inc. (collective)
"AT&T") and Utility a copy of which is attached as Exhbit A• y
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth
in this Assignment and Assumption Agreement, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Assumption. ELI hereby assumes all rights and obligations of the IRU
Agreement as of the Effective Date hereof.
2. Pavments.
(a) To AT&T. Utility has made all payments through
2011 for the indefeasible right to use two (2) strands of dark fiber under the terms of the IRU
Agreement. In return for the transfer from Utility to ELI of the indefeasible right to use the two
(2) strands of dark fiber under the terms of the IRU Agreement, ELI shall assume a ent
obligations under the IRU Agreement as of the Effective Date with the f p
first payment owing to
AT&T on , 2011, and all payments thereafter, all in accordance with the terms of
the IRU Agreement.
(b) To Utility. In return for the transfer from Utility to ELI of the
indefeasible right to use two (2) additional strands of dark fiber apart from the two strands
identified above in paragraph 2 (a) under the terms of the IRU Agreement, ELI shall a to
Utility the sum of one million one hundred thousand dollars and no cents thirty 30 days of acceptance (�1 pay
,100,000.00) within
Y ep e by ELI of the indefeasible right of use in the two 2 additional
strands of dark fiber. )
(c) The payments required by subsections (a) and (b) of this 3
represent the total amount of the purchase price of the indefeasible paragraph
nght to use the four (4)
strands of dark fiber under the terms of the IRU Agreement.
3. Representations and Warranties of ELI. ELI represents and warrants to Utility as
follows: Y
(a) Existence and Good Standin ELI is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware
and has the power
1
and authority to own, lease, and operate its properties and carry on its business as now being
conducted by it.
(b) Authorization. This Assignment and Assumption Agreement has been
duly authorized, executed and delivered by ELI, and constitutes the legal, valid and binding
obligation of ELI. Under applicable law, no approval, authorization, consent, clearance, order or
other action of(other than those already obtained), or filing (other than notice) with, any person,
firm or corporation, or any court, administrative agency or other governmental authority, is
required in connection with the execution and delivery by ELI of this Assignment and
Assumption Agreement or the performance by it of the transactions described herein.
4. Representations and warranties of Utility Utility represents and warrants to ELI
as follows:
(a) Existence and Good Standin Utility is duly organized and in good
standing under the laws of California.
(b) Power and Authority; Authorization. Utility has full power and authority
to enter into, execute and deliver this Assignment and Assumption Agreement, and to perform
each of its obligations hereunder. This Assignment and Assumption Agreement, and the
performance of Utility's obligations hereunder, have been duly authorized, executed and
delivered by Utility, and constitute the legal, valid and binding obligations of Utility. Under
applicable law, no approval, authorization, consent clearance order y
or other action of (other
than those already obtained), or filing (other than notice) with, any person, firm or corporation,
or any court, administrative agency or other governmental authority, i o
g y, s required in connection
with the execution and delivery by Utility of this Agreement or the performance b it of the
transactions described herein. y
(c) Obligations Under IRU Agreement. Utility has fully performed each and
all of its obligations under the IRU Agreement as of the Effective Date.
(d) Functionality of Fiber Strands. As of the Effective Date, to the best of its
knowledge, Utility does not know of any defects in the fibers strands that would impair
communications transmissions over the fiber strands. Notwithstandingp
the foregoing, ELI
acknowledges that any such defects discovered after the Effective Date are addressed in
accordance with the terms of the IRU Agreement..
5. Covenants. Each party will use all commercially reasonable efforts to take or
cause to be taken, all actions and do, or cause to be done, all other things necessary, proper or
appropriate to consummate and give full force and effect the transact p p
transactions contemplated by this
Assignment and Assumption Agreement.
6. Indemnification by ELI. ELI covenants and agrees to indemnify, defend protect
and hold harmless Utility and each of its respective directors officers m
managers, members,
assigns, successors and affiliates (individually, a "Utility Indemnified respect Party" and collectively,
"Utility Indemnified Parties") from, againstp and in res of.
2
all damages suffered, sustained, incurred or paid by any of the Utility Indemnified Parties
in connection with, resulting from or arising out of, directly or indirectly: (A) any
nonfulfillment or breach of any covenant or agreement on the part of ELI in this
Assignment and Assumption Agreement; or (B) the violation, conflict, breach of or
default under (or omission or commission of any action, condition or event which, after
notice or lapse of time or both, would result in any such violation, conflict, breach of or
default under) the IRU Agreement arising from any acts or omissions of ELI following
the Effective Date.
ELI covenants and agrees to indemnify, defend, protect and hold harmless AT&T and each of its
respective directors, officers, managers, members, assigns, successors and affiliates
(individually, an "AT&T Indemnified Party" and collectively, "AT&T Indemnified Parties"
from, against and in respect of: )
all damages suffered, sustained, incurred or paid by any of the AT&T Indemnified Parties
in connection with, resulting from or arising out of, directly or indirectlyan
nonfulfillment or breach of any covenant or agreement on the Y
�' part of ELI in this
Assignment and Assumption Agreement.
7. Indemnification by Utility. Utility covenants and agrees to indemnify, defend,
protect and hold harmless ELI and each of its respective directors, officers, managers, members
assigns, successors and affiliates (individually, an"ELI Indemnified Party" and collectively,
"ELI Indemnified Parties") from, against and in respect of:
(a) all damages suffered, sustained, incurred or paid by any of the ELI
Indemnified Parties in connection with, resulting from or arising out of, directlyor
indirectly: (ii) any nonfulfillment or breach of an covenant
Y or agreement on the part of
Utility in this Assignment and Assumption Agreement; or(ii) the violation, conflict
breach of or default under(or omission or commission of any action, condition or event
which, after notice or lapse of time or both, would result in any such violation conflict
breach of or default under)the IRU Agreement arising from any acts or omissions of
Utility prior to the Effective Date.
(b) any and all costs, fees, or amounts demanded from ELI by AT&T or an third
party relating to any cause of action or any amounts owing, from Y
reason, that arose from an Utility whatever cause or
y ity actions or omissions or are based upon any matter
arising prior to the Effective Date.
S. Procedure for Indemnification.
(a) In the event a Party intends to seek indemnification pursuant to the provisions
of Sections 6 or 7 hereof(the "Indemnified Part " , the Indemnified
y ) Party shall promptly
give notice hereunder to the other Party(the "Indemnifying_Party") after obtaining
written notice of any claim or the service of a summons or other initial legal process in
any action instituted against the Indemnified Party as to which recovery may be sought
against the Indemnifying Part because of the indemnification Y
Y emnification provided for in Section 6
or 7 hereof, and, if such indemnity shall arise from the claim of a third Part the
Indemnified Party shall permit the Indemnifying Part to assume Y�
Y g y e the defense of any such
3
claim and any litigation resulting from such claim; provided that the Indemnified Party
shall not be required to permit such an assumption of the defense of any claim or
litigation which may reasonably be expected to result in nonmonetary damages or relief,
or which, if not first paid, discharged or otherwise complied with, could reasonably be
expected to result in a material interruption or disruption of the business of the
Indemnified Party or any material part thereof. Notwithstanding the foregoing,the right
to indemnification hereunder shall not be affected by any failure of the Indemnified Party
to give such notice(or by delay by the Indemnified Party in giving such notice)unless,
and then only to the extent that, the rights and remedies of the Indemnifying Party shall
have been prejudiced as a result of the failure to give, or delay in giving, such notice.
(b) If the Indemnifying Party assumes the defense of such claim or litigation
resulting therefrom, the obligations of the Indemnifying Party hereunder as to such claim
or litigation shall include taking all steps necessary in the defense or settlement of such
claim or litigation and holding the Indemnified Party harmless from and against any and
all damages caused by or arising out of any settlement approved by the Indemnifying
Party or any judgment entered in connection with such claim or litigation. If the
Indemnifying Party assumes the defense of such claim or litigation resulting therefrom,
the Indemnified Party shall not settle the claim without the prior written consent of the
Indemnifying Party. The Indemnifying Party shall not, in the defense of such claim or
any litigation resulting therefrom, consent to entry of any judgment(other than a
judgment of dismissal on the merits without costs) except with the written consent of the
Indemnified Party(which consent shall not be unreasonably withheld, delayed or
conditioned) or enter into any settlement(except with the written consent of the
Indemnified Party(which consent shall not be unreasonably withheld, delayed or
conditioned)unless (i) there is no finding or admission of any violation of law and no
material adverse effect on any other claims that could reasonably be expected to be made
against the Indemnified Party, (ii)the sole relief provided is monetary damages that are
paid in full by the Indemnifying Party or applied against the Deductible, and (iii)the
settlement shall include the giving by the claimant or the plaintiff to the Indemnified
Party a release from all liability in respect to such claim or litigation.
(c) If the Indemnifying Party assumes the defense of such claim or litigation
resulting therefrom, the Indemnified Party shall be entitled to participate in the defense of
the claim,but the Indemnified Party shall bear the fees and expenses of any additional
counsel retained by it.
(d) If the Indemnifying Party does not assume the defense of any such claim b a
third Party or litigation resulting therefrom after receipt of notice from Y
p the Indemnified
Party, the Indemnified Party may defend against such claim or litigation in such manner
as it reasonably deems appropriate; provided that the Indemnified Party may not settle the
claim without the prior written consent of the Indemnifying Party, which consent shall
not be unreasonably withheld, delayed or conditioned. The Indemnified Part 's
reasonable attorneys' fees and costs of the action shall be aid b the Indemnifying Y
p y nifying party.
4
9. Notices. All notices, demands and other communications provided for hereunder shall
be in writing and shall be given by personal delivery, via facsimile transmission(receipt
telephonically confirmed),by nationally recognized overnight courier(prepaid), or by certified
or registered first class mail,postage prepaid,return receipt requested, sent to each Party, at
its/his address as set forth below or at such other address or in such other manner as may be
designated by such Party in written notice to each of the other parties. All such notices, demands
and communications shall be effective when personally delivered, one(1) Business Day after
delivery to the overnight courier,upon telephone confirmation of facsimile transmission or upon
receipt after dispatch by mail to the Party to whom the same is so given or made:
If to Utility:
With a copy to:
If to ELI: Electric Lightwave, LLC
1201 NE Lloyd Blvd.
Suite 500
Portland, OR 97232
Attn: Department of Law&Policy
10. Governing Law and Choice of Forum. This Assignment and Assumption Agreement
shall be governed by and construed in accordance with the laws of the State of California
without regard to otherwise applicable conflicts of laws principles.
11. Remedies Cumulative. Remedies herein provided are cumulative and not exclusive
of any other remedies provided by law.
12. No Waivers. No purported amendment, modification or waiver of any provision of
this Assignment and Assumption Agreement or an of the documents
Y , instruments or agreements
to be executed by the parties pursuant hereto shall be effective unless in a writingspecifically
referringto this Assignment p p y
gnment and Assumption Agreement and signed by all of the parties.
13. Dispute Resolution. In the event of any dispute arising out of or related to this
Assignment and Assumption Agreement or the performance thereof, the Parties shall first
attempt, for a period of thirty (30) days, to resolve the dispute through good faith negotiations
prevailing between the parties. In addition to all other relief, the i g
p g party y n any action shall be
entitled to recovery of its attorneys fees and litigation expenses. Nothing herein shall prevent
either party from commencing an action for injunctive relief duringthe
e pendency of any dispute.
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14. Successors and Assigns.
This Assignment and Assumption Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, personal representatives, successors and permitted
assigns, but except as hereinafter provided in this Section, nothing in this Assignment and
Assumption Agreement is to be construed as an authorization or right of any Party to assign its
rights or delegate its duties under this Assignment and Assumption Agreement, except to an
affiliate or successor in interest,without the prior written consent of the other parties hereto,
which consent shall not be unreasonably withheld. No such assignment shall relieve any Party of
its obligations hereunder.
15. Expenses. Except as otherwise provided in this Assignment and Assumption
Agreement, each party hereto shall be responsible for and bear all of its own costs and expenses
(including the expenses of its representatives) incurred at any time in connection with the
negotiation,preparation, execution and delivery of this Assignment and Assumption Agreement.
16. Taxes. Utility shall be responsible for, and indemnify ELI against, any taxes,
franchise fees, surcharges or other government-imposed fees, or charges ("Taxes"), arisingfrom:
(i) Utility's indefeasible right of use to the four 4 fiber strands pursuant
( ) p to the IRU Agreement;
and/or (ii) Utility's rights and obligations under the IRU Agreement in so much as such Taxes
are assessed for or on time periods prior to the Effective Date of this Assignment and
Assumption Agreement.
17. Severability. In the event that any provision of this Assignment and Assumption
Agreement is declared or held by any court of competent jurisdiction to be invalid or
unenforceable, such provision shall be severable from, and such invalidity or unenforceabilit
shall not be construed to have any effect on, the remainingprovisions of this A y
p Assignment and
Assumption Agreement, unless such invalid or unenforceable provision goes to the essence of
this Assignment and Assumption Agreement, in which case the entire Assignment and
Assumption Agreement may be declared invalid and not bindingupon �
p any of the parties.
18. Parties in Interest. Except as hereinafter expressly set forth, nothing expressed or
implied in this Assignment p
p gnment and Assumption Agreement is intended or shall be construed to
confer any rights or remedies under or by reason of this Assignment and Assumption Agreement
upon any Person other than the parties hereto and their respectivep
successors and permitted
assigns. Nothing in this Assignment and Assumption Agreement is intended to relieve or
discharge the Liabilities of any third Person to the parties hereto.
19. Waiver. The terms, conditions, warranties, representations and indemnities
contained in this Assignment and Assumption Agreement, including the documents, instruments
and agreements executed and/or delivered by the parties pursuant hereto, may be waived only b
a written instrument executed by the Party waivingcompliance. y y y
p Any such waiver shall only be
effective in the specific instance and for the specific purpose for which it was given and shall n
be deemed a waiver of any other provision hereof or of the sameof
breach or default upon any
recurrence thereof. No failure on the part of a Party hereto to exercise and no delayin exercising
any right hereunder shall operate as a waiver thereof nor shall an single g
y ngle or partial exercise of
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any right hereunder preclude any other or further exercise thereof or the exercise of any other
right.
20. Entire Agreement; Modification. This Assignment and Assumption Agreement,
including any schedules and exhibits hereto, constitutes the entire agreement between the parties
p
hereto with respect to the subject matter hereof, superseding,
g, all prior negotiations,
correspondence and understandings between the parties. No amendment or modification of this
Assignment and Assumption Agreement shall be binding on the parties unless made in writing
and duly executed by all parties. There are no oral or implied agreements and d
p gr' no oral or implied
warranties between the parties hereto other than those expressed herein.
21. Counterparts. This Assignment and Assumption Agreement may be executed in
counterparts, all of which taken together shall constitute one instrument.
22. Miscellaneous. This Assignment and Assumption Agreement and the obligations
of the parties hereunder shall be binding upon and inure to the benefit of the parties hereto and
their respective legal representatives, successors and assigns.
In confirmation of their consent and agreement to the terms and conditions contained in this
Agreement and intending to be legally bound hereby, the parties have executed this Agreement
as of the dates set forth below.
Truckee Donner Public Utility District
By:
Title:
Date:
Electric Lightwave,LLC
By:
Title:
Date:
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