Dark Fiber Optic Cable Lease and Installation Agreement
Contract No. C-03-120-0132
DARK FIBER OPTIC CABLE LEASE AND INSTALLATION AGREEMENT
This Dark Fiber Optic Cable Lease and Installation Agreement (the "Agreement") is made and entered into this
day of , 2004 (the "Effective Date"), between FiberLink LLC dba Columbia Fiber Solutions,
with its principal offices located at 10905 E. Montgomery Dr., Suite 1, Spokane, Washington 99206-6606
(hereinafter known as "COLUMBIA") and the City of Spokane Valley, with its principal offices located at 11707
E. Sprague, Spokane Valiey, WA 99206 (hereinafter called "Customer") and collectively called "Parties."
RECITALS
WHEREAS, Customer desires to obtain the use of certain fiber optic communications technology within
and around the city of Spokane Valley; and
WHIEREAS, COLUMBIA desires to provide certain fiber optic communications technology to Customer;
and
WHEREAS, Customer has requested that-COLUM}3IA install and provide access to COLUMBIA-owned
fiber optic communications technology; and
NOW, THEREFORE, in consideration of the mutual covenants in this Agreement and other just and
adequate consideradons, the Parties, their successors, and assigns do hereby agree as follaws:
ARTICLE 1
SCOPE OF AGREEMENT .
1.1 COLUMBIA agrees to provide and. lease to Customer, and Customer agrees to lease from
COLUlVIBIA; two (2) strands.` of single-mode fiber optic . cable togetlier with appurtenant hardware and
telecommunications equipment (collectively, the "Dark Fiber") providing fiber optic cornectivity to and between the
following locations: City of Spokane Valley City Hall at 11707 E. Sprague Spokane Valley WA 99206 to City of
Spokane Valley Police Station at 12710 E. Sprague Spokane Valley WA 99206: This Agreement is a Dark Fiber
]ease providing unIimited bandwidth use to Customer.
ARTICLE 2 .
INSTALLATION, MAINTENANCE ANA ACCEPTANCE
2.1 DemarcaNon Points. As used in this Agreement, "Demarcation Points" shall be defined as the
connection points between the COLUMBIA-owned Dark Fiber and Customer-owned fiber optic cable or peripheral .
equipment, generally a fiber distribution panel located within a secure communications equipment room within each
facility. The specific locatian of the Demarcation Points within each facility identified in Article 1.1 above shall be
mutually agreed upon by the Parties prior to constructian with the exception of City Hall at 11707 E. Spragne, where
a demarcation point for the building already exists.
2.2 Iastallation and Fee. Except, for such specialiied construction as defined in ArticIe 2.4 below,
COLUMBIA shall provide a]] labor, materials and equipment required to engineer, install, splice and test the Dark
Fiber between the Demarcation Points described in Article 2.1. Installation and circuit provisioning shall be performed on a mutualty agreed-upon schedule. This installation will include a fiber optic patch pane] at each of
Customer's faciIities. For the installation services described herein, Customer shall pay a one-time installation fee of
approximately twelve thousand six hundred dollars and no cents ($12,600.00) to COLUMBIA (the "Installation
Estimate") plus applicable sales and use tax. Both Parties have discussed and agree that the actuaI installation cost
~ may be higher than the Installation Estimate,'due to unforeseen conditions such as: (a) higher cost of obtaining
public and private easements and permits; and (b) unforeseen "make ready" work, such as having to make
improvements an the facilities of other utilities to accommodate the Dark Fiber tliat COLUMBIA installs pursuant to
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Contract No. C-03-120-0132
this Agreement (collectively "Unforeseen Construction Conditions"). In the event COLUMBIA encounters any
Unforeseen Canstruction Conditions, COLUMBIA shall notify Customer of such Unforeseen Construction
Conditions, and provide to Customer a revised Installation Estimate (the "Revised Installation Estimate") prior to
undertaking the instaIlation provided for herein.
2.3 Payment for Installation. Customer agrees to pay the Installation Estimate described in 2.2
based on the following schedule:
One-hundred percent (100%) of the Installation Estimate or, in the event that Unforeseen Construction
: Conditions are encountered, one-hundred percent 00%) of the Revised Installation Estimate will be due
and payable at the Acceptance Date , as defined in Article 2.7, below.
2.4 Customer Responsibilities. Customer shall, at its own expense, be solely responsible for the
purchase, installation and maintenance of all terminals, fiber optic cable, and other peripheral equipment required by
Custamer to interconnect with the Dark Fiber and with other fiber andlor copper telecommunications cable located
on Customer's side of the Demarcation Points at Customer's facilities. In addition, Customer shall, at its own
expense, provide aIl labor, materials and equipment for any speciatized construction that may be required on
Customer's properiy including, but not Iimited to, the installation of new conduit or core drilling. Customer shall
also be solely responsible for obtaining and maintaining all rights-of-way from Customer's property line to the
Demarcation Point and obtaining a building access agreement from the building owner, if not previously in place.
2.5 Maintenance of Servace. As part of the services provided under this Agreement, COLUMBIA
shall provide all maintenance services of COLUMBIA-owned Dark Fiber and other COLUMBIA-owned peripheral
equipment not located on Customer's property, as well as routine scheduled mai.ntenance of COLUMBIA-owned
Dark Fiber and other COLUIVBIA-owned peripheral equipment Iacated on Customer's property on COLUtVBIA's side of the Demarcation Points at no cost to Customer. All other maintenance of COLLTMBIA-owned Dark Fiber
and other COLUMBIA-owned peripheral equipment (e.g., repairs required due to cable cuts, fires, or other acts of
third parties or Force Majeure events) located on Customer's property on COLUMBIA's side of the Demarcation
Points shall be provided by COLUMBIA to Customer at the rates set forth in Article 5.4 below. In the event
COLUMBIA is required to respond to a perceived or actual interruption of Customer's service and it is determined
that the interruption was the resuIt of Customer's actions and/or equipment and not attributed to . the failure of
COLZTMBIA's services, COLUMBIA reserves the right to charge the Customer for said maintenance services at the
rates set forth in Article 5.4 below.
2.6 Prior to commencement of the Term of this Agreement as defined in Article 4, below,
COLLTMBIA shall perform a light meter test of the Dark Fiber circuit to verify that circuit performance to and
between the Iocations identified in Article 1.1 above is within industry specifcations for calculated loss budget
("Fiber Acceptance Testing") and shail, upon receipt of Customer's written request therefore, prompdy provide
Customer with a certified report of such test results.
2.7 If COLUMBIA provides the test results to Customer, Customer shall provide COLUMBIA with a
written notice accepting (or rejecting by specifying the defect or failure in the Fiber Acceptance Testing that is the
basis for such rejection) the Dark Fiber. If the Customer fails to notify COLUMBIA of its acceptance or rejection of
the final test results with respect to the Dark Fiber within f fteen (15) days after Customers receipt of such notice,
Customer shall be deemed to have accepted the Dark Fiber. The date of such notice of acceptance (or deemed
acceptance) of the Dark Fiber shall be the "Acceptance Date" for the Dark Fiber. In no event will the Acceptance
Date be later than , 2004. In the event of any good faith rejection by Customer, COLUMBIA shall take
such action reasonably necessazy and as expeditiously as practicable to correct or cure such defect or failure.
ARTICLE 3
LEASE
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3.1 COLUMBIA agrees to exclusively lease to Customer, the Dark Fiber between the Demarcation
Points identified in Article 1.1 above, for the Term defined in Article 4 and for any extension or renewal thereof and
on other terms and conditions stated in this Agreement.
ARTICLE 4
LEASE TERM
4.1 The initial non-cancelable term of this Agreement shall commence on the Acceptance Date and
shall remain in effect for a period of two (2) years (the "Term"). Thereafter, Customer may, at its option, extend
the Term for an additional period of time, not to exceed the remaining period of time on the franchise agreement
between the Customer and COLUMBIA.
ARTICLE 5
LEASE PAYMENT AND OTHER CHARGES
5.1 In consideration for the Dark Fiber to be provided by COLUIVBIA pursuant to this Agreement,
Customer agrees to make a tota] of twenty four (24) monthly lease payments (the "Lease Payments") to
COLUMBIA. It is agreed that Customer's obligation to make Lease Payments shall begin on the Acceptance Date,
and corninue until all twenty four (24) Lease Payments have been made to COLLJMBIA. Customer understands
that the term of this Lease is non-cancelable, and, therefore, Customer's obligation to make Lease Payments
continues, regardless of Customer's actual usage of the Dark Fiber. The amount of each Lease Payment shall be in -
accordance with the schedule set forth in Article 5.2 below.
5.2 The Lease Payment obligation, due on the first day of each month, shall be thirty dollars and no
cents - ($30.00) plus applicable sales and use tax, for the remainder of the- Term. The Lease Payment obligation
represents that Spokane Valley is being charged $20.00 per pair of fiber in use per mile pursuant to the ordinance
granting Fiber. a nonexclusive franchise, Spokane Valley Ordinance No. 03-073, and the distance between the
demarcation points is 1.5 miles. _
5.3 Lease Payments, and any other payments shall. be mailed or delivered to the following billing
address:
Mailing Address (for ~,avment pur~oses onlv:
Columbia Fiber Solutions 10905 E. Montgomery Drive, Suite 1
- Spokane, WA 99206-6606
If any part of a Lease Payment or other payment obligation of Customer is more than thirty (30) days past
due, such amount shall accrue interest from the date such payment is due until paid, including accrued interest
compounded monthly, at an annual rate equal to one and one half percent (1.5%) per month on the outstanding
balance.
5.4 Maintenance Charees. Pursuant to Article 2.5, COLUMBIA personnel shall be billed to
Customer at the following per person rates:
Normal Business Hours (8 am to 5 Qm M-F PST) ' Non-Business Hours
Minimum call out charge (1 S" hour, each mobilization) $150.00 /hr $ 250.00 /hr
Additional hours . $ 75.00 /hr $ 150.00 /hr
In addition, COLUMBIA will charge for all of its out of pocket costs for any subcontractor support and
material required.
Maintenance Charges are subject to change upon written notice to Customer.. Fiber Optic Cable Lease Agreement 3 of 7 Rev. 5/12/04
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5.5 In addition to the Lease Payments and other charges pursuant to Article 5 due under this
Agreement, Customer shall pay amounts equal to its share of any taxes, duties, and impositions resulting from this
Agreement for any activities hereunder, exclusive of taxes based upon COLUMBIA's net income.
ARTICLE 6 '
LEASE STATUS -
6.1 The Parties intend that this Agreement shall operate as a"lease", as defined by Washington State
law. COLUMBIA's Dark Fiber shall not be construed to result in the transfer of title to any part of the Dark Fiber to
Customer or in the creation of a"security interest" within the meaning of Washington State law. Customer disclaims
any interest it may claim in the materials, equipment, fiber optic cable and all personal property installed by
COLUMBIA between the Demarcation Points as a fixture. Any materials, equipment, fiber optic cable and other
personal property shall remain COLUMBIA's personal property even though it is insta.lled to the real property of the
Customer. Customer acknowledges that it has no option to purchase any part of the materials, equipment, fiber optic
cable and other personal property of COLUMBIA installed between the Demarcation Points.
ARTICLE 7
OTHER RESPONSIBILITIES AND OBLIGATIONS OF THE PAR1'IES
7.1 Moves, adds, and changes of, to, and affecting the Dark Fiber at the locations identified in Article
1.1, which are requested by Customer, shall be provided by COLUMBIA at the then-current time and material rates,
with payment terms of 50% due upon Customer approval of cost estimate, and the balance payable upon completion
of the work. During the initial Term, Customer may request that COLUMBIA's services be provided to alternative
- ---location(s) than the location(s) set forth in Article.-1.1 above. = Customer shall pay adequate- and agreed upon
nonrecurring charges to transfer the services.to such alternative location(s). The Lease Payment set forth in Article
5.2 above. will be applied to a new Lease Payment applicable to the new location(s) based on then : current
COLUMBIA lease rates. In the event of such a request, both parties agree to enter into a new then current
COLUMBIA lease agreement that documents the new location(s) and the new Lease Payment. 7.2 Customer agrees to assume full and complete control, responsibility, and liability for the content and signals transmitted through the Dark Fiber by its employees, customers, agents, and invitees, and Customer
further assumes all liability from any third party claims, suits, or disputes over such content and signals.
7.3 COLUlV13IA and Customer agree that COLUIVEBIA's Dark Fiber shall not be used in a maruner
that could be construed as a violation of this Agreement, or any laws, regulations, orders, andJor rules of any
go.vernmental authority having jurisdiction. Customer and COLUMBIA agree .to take al] reasonable actions as may
be appropriate to comply with all laws, regulations, orders and/or rules, that may be applicable to them jointly.or
severally by reason of the transactions contemplated in this Agreement.
7.4 Each Party shall indemnify and hold harmless the other Party and its respective officers, agents and
employees from and against all claims, damages, losses, liabilities, and costs arising from its negligent acts or
omissions.
ARTICLE 8
FORCE MAJEURE
8.1 Except for Customer's obligation to remit payments for the Dark Fiber services hereunder, in the
event either Party is prevented from performing it obligations under this Agreement due to circumstances beyond its
control including, without limitation, labor disputes, power outages -or shortages, fire, explosion, flood, drought, acts
of God, war or other hostilities, civil commotion, domestic or foreign governmental acts, orders, or regulations, or if
Customer or COLUIVIBIA is notified by a state or federal regulatory body that any aspect of this Agreement does not
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comply with any applicable law, regulation, rule, or policy, then the obligation of COLUMBIA to provide services
and/or the obligation of the Customer to accept services hereunder shall be suspended during the period of such
disability.
ARTICLE 9
LIlVIITATION OF LIABILITY AND DISCLAIMER
9.1 COLUMBIA MAKES NO REPRESENTATION OR WA.RRANTY EITHER EXPRESSED OR
IlvIPLIED REGARDING THE DARK FIBER, SERVICES OR SYSTEM EQLTIPMENT, AND SPECIFICALLY
DISCLAIMS ANY WARRANTY, INCLUDING BUT NOT LIMITED TO ANY IlVIPLIED WARR.ANT]ES OF
MERCHANTABILTTY AND/OR FITNESS FOR A PARTICULAR PURPOSE, AND ASSUMES NO
OBLIGATION WITH RESPECT TO THE ENFORCEMENT OF ANY MANUFACTURER'S WARRANTIES
AND GUA►R.ANTEES. No defect, unfitness, or other condition of system equipment or services shall relieve the
Customer of the obligation to pay any charges hereunder or perform any other obligations under this Agreement.
9.2 Customer's sole and exclusive remedies for breach or non-perforrnance of this Agreement, by
COLUMBIA shall be, at COLUMBIA's election, re-performance and/or repair or replacement by COLUMBIA of
any defective services, or of any defective equipment provided in connection with the services, or the refund of any
compensation actually paid to COLUMBIA by Customer during the period of such breach or nonperformance.
COLUMBIA will in no event be liable for consequential or incidental damages, including but not limited to,
damages for loss of use, lost profit, loss of business or goodwill, or other financial injury arising out of or in connection with the maintenance, use, performance or failure of the Service or equipment. In no event shall
COLUMBIA be liable for any loss or damage relating to a claim for personal injury arising out of or in connection
with maintenance, use, performance or failure of the Service or equipment. COLUMBIA's liability to the Customer,
f,or damages, from any _cause whatsoever and regardless of the form of the action, whether in contract, in tort
(.cluding- ...ne~ence or strict liability) or bY statute, shall be limited to direct damages and- shall not exceed the
m ig
value of the to-tal payments paid to COLUMBIA under this Agreement.
9.3 It is expressly understood that COLUMBIA's Dark Fiber may be routed through various city,
county, state and/or other third party road rights-of-way and under franchise with city, county, state and/or other third
- parties, and that these parties shall be made a third-party beneficiary of the limitations of Iiability stated in Article 9.2
above.
ARTICLE 10
DEFAULT AND REMEDIES
10.1 Any of the following shall constitute an event of default: (a) Customer fails to pay any Lease
Payment or any other amount owed to COLUMBIA within thirty (30) days after its due date; (b) Custamer fails to
perform or observe any other representation, warranty, covenant, condition or agreement with COLUMBIA and fails
- to cure such breach within thirty (30) days after written notice; (c) any representation or warranty made by Customer
hereunder or in any other instrument provided to COLUMBIA by Customer proves to be incorrect in any material
respect when made; (e) Customer becomes insolvent or fails generally to pay its debts as they become due; (fl
Customer voluntarily or involuntarily dissolves or is dissolved.or terminates or is terminated; or (g) COLUMBIA
fails to observe or perforrn any of its representations, warranties, andlor obligations with Customer and fails to cure
such breach within thirty (30) days after written notice.
10.2 In the event of a default by either parry, the non-defaulting party shall have the right to exercise
any or all of the following remedies to the extent applicable: (a) terminate this Agreement; (b) declare all Lease
payments and other amounts under this Agreement immediately due and payable; (c) proceed to enforce the remedies
of a secured party under Washington State law; (d) proceed by court action to enforce performance of this
Agreement and any remedy provided for herein. and/or recover all damages of any default or exercise any other right
J or remedy available at law or in equity; and (e) discoruiect andlor remove the fiber optic cable and equipmenL
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Contract No. C-03-120-0132
ARTICLE 11
GOVER1vING LAW AND VENUE
11.1 This Agreement shall be governed, interpreted and enforced according to the laws of the State of
Washington, without reference to its conflicts of law principles. The venue of any action or proceeding arising out
of or related to this Agreement shall be in Spokane County, Washington.
ARTICLE 12
ATTORNEY'S FEES
12.1 If any suit or action is filed by any Party to enforce this Agreement or otherwise with respect to the
subject matter of this Agreement, the prevailing party shall be entitled to recover reasonable attorney's fees, as fixed
by the reviewing caurt, incurred in investigation of related matters and in preparation for the prosecution of such suit
or action as fixed by the trial court and if any appeal or other form of review is taken from the decision of the trial
court or any subsequent court.
ARTICLE 13
MISCELLANEOUS
13.1 Nothing contained in this Agreement shall be construed to create any partnership or agency
relationship between the Parties for any purpose, action, or transaction, including those related to the performance of °
this Agreement. • _
13.2: COLUMBIA may, without Customer's consent; -assign or otherwise transfer this Agreement or its
rights or obligations hereunder to any other party, in whole or in part, except as provided for in the ordinance.
granting COLUIV13IA a nonexclusive franchise, Spokane Valley Ordinance No. 03-073. Any such assignee shall
agree in writi.ng to be bound and abide by this Agreement. Customer may not assign or sublease this Agreement or
any interest, payment, or rights hereunder without the prior written consent of COLUMBIA.
13.3 If any portion of this Agreement is stricken as an invalid provision, the remaining portions of this
Agreement shall remain in full.force and effect and shall continue to be binding upon the Parties.
13.4 Waiver of any provisions in this Agreement or failure of either Party to enforce any of its rights
under this Agreement in a particular instance shall not be construed as a permanent waiver of those rights or any
other rights under this Agreement.
13.5 All notices, requests, demands and other communications made pursuant to this Agreement shall
be in writing and shall be deemed duly given if personally delivered or sent by registered, postage prepaid, as
- follows, or to such other address or person as either party may designate by notice to the other party:
(a) If to COLUMBIA: (b) If to Customer:
Columbia Fiber Solutions City of Spokane Valley
10905 E. Montgomery Drive, Suite 1 11707 E. Sprague
Spokane, WA 99206-6606 Spokane Valley, WA 99206
Attn: John Everett Attn: Ken Thompson
Phone: (509) 688-4519 Finance & Administrative Services Director
Fax: (509) 688-4099 Phone: (509) 688-0027
Fax: (509) 921-1008
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IN WITNESS WHEREOF, this Agreement has been executed by a duly authorized representative of each Party as
of the day and year first above written.
COLUMBIA FIBER SOLUTIONS CITY OF SPOKANE VALLEY
_ Nj
(Authorized Signature) (Authorized Signature)
.Tohn Everett AJVid
(Printed Name) (Printed Name)
General Manager
(Title) ~ (Title) ~
2, L5
(Date) (Date)
Fiber Optic Cable Lease Agreement 7 of 7 Rev. 5/12/04