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HomeMy WebLinkAboutItem 4.06 MetricomAgmtChange CITY CLERK File # D~[Q[Z2i3JlQ) . AGENDA STATEMENT CITY COUNCIL MEETING DATE: (February 17,1998) SUBJECT: Request By Metricom, Inc. To Authorize Change In Control Agreement Providing For Maintenance of Wireless Communications Facilities On ~ Public Property - Wireless Radio Transmitters On Street Lights EXHIBITS ATTACHED: 1. Letter Dated January 22,1998 From Metricom, Inc. To City Manager Requesting Approval of Change In Control 2. Agreement Dated January 29,1997 RECOMMENDATION: Review the request and authorize the City Manager to consent to the change J ~ control as outlined in the letter from Metricom, provided that the firm is f'" not in breach of the Agreement, including payment of any monies owed pursuant to the Agreement. In addition authorize Staff to exchange lease revenue from 12 antenna locations to provide a pilot project involving Internet access and e-mail on five workstations. FINANCIAL STATEMENT: In Fiscal Year 1996/97 the City received $1,920 in rental revenue for the use of City Street lights at 32 locations. The agreement also allows the City to receive services in lieu of the rental fees in accordance with a specific schedule. Selection of the services would reduce the amount of revenue received. 8 DESCRIPTION: In 1997, the City Council approved an Agreement with Metricom, Inc., regarding the placement of radio equipment within the public right-of-way. The Company installed a wireless network which allows computer users with special modems to access the Internet, without attaching directly to a telephone line. At the time of the initial installation, the Company had a total of32 transmitters located on City Street lights. The Agreement with Metricom granted certain approval rights to the City of Dublin, in the event that there was a change in ownership and/or control of the Company. Metricom has requested that the City concur with a recent change in the control of the company. BACKGROUND The concept used by Metricom is similar to the design of a cellular telephone network. Radio repeaters are used to receive data. Radios must be placed throughout a service area in order to provide adequate coverage to allow subscribers to reach the service from different locations. At the time of the initial installation, the Company had a total of 32 transmitters located on City Street lights. Typically the firm prefers to mount the radios on street lights. The data eventually moves from the poletop radios to a wired access point located in the center ofa cluster of pole top radios. Subscribers using Metricom's network pay monthly access fees plus a rental cost for the wireless modem. 8------------------------------------------------------------------- COPIES TO: 4 ITEM NO. ..6 G/Leases/MTRCM98.doc RELEVANT PROVISIONS IN AGREEMENT Section I I (B) of the Agreement (Exhibit 2), allows the City the right to notify Metricom of its intent to' terminate the Agreement in the event of a change in controL The City must notify Metricom of its intent within 90 days of receiving notice from the Company of the Change In ControL The Notice from Metricom is attached as Exhibit 1, and was received on January 23, 1998. The City must respond by . April 23, 1998, or it is assumed to be automatically approved. Prior to that deadline the City is expected to receive its annual fee payment based upon the number of radios installed on City facilities. Section 11 (C) of the Agreement defines the tern change of control to include the acquisition of a majority interest in the firm by a person or "group". Further Metricom must advise the City of purchase of30% or more of the firm's outstanding securities by a person or group. Metricom is also required to present evidence demonstrating the following: a) it is not in breach of its license; and b) the financial condition will not be deteriorated following the change in control, compared to its current structure. REQUEST FOR CHANGE IN CONTROL As identified in the letter from Metricom (Exhibit 1) recent transactions have occurred affecting the ownership of the Company. Mr. Paul G. Allen fully owns Vulcan Ventures Incorporated, which is holding company used by Mr. Allen to invest in various companies, products, and technologies. Although, Vulcan has been an investor in Metricom since 1993, in November 1997 the firm made a purchase of Metric om common stock, which increased its ownership interest in Metricom to 33 percent. The firm is contractually obligated to make a subsequent investment of$55.8 million, which will increase its ownership interest in the firm to 49.7 percent. In addition to the financial arrangements, Vulcan will also assume a different role in the management of Metricom. Under the terms of the purchase, the Metricom Board of Director's will be reduced from nine to seven members and four of the seats are to be filled by persons appointed by Vulcan. Metricom has represented that the change in control should strengthen the firms financial position through the additional investment by Vulcan. The firm also states that they are not currently in breach of their agreement. Pursuant to the terms of the Agreement Metricom originally installed radios in February 1997. Therefore, the second year of Fee payments should be received by the City on or before March 28, 1998. Staff does not have any reason to expect that the fees will not be received, however, it seems appropriate to assure that the payment is made prior to executing the Change in Consent. . EXCHANGE OF SERVICES / EOUlPMENT FOR PORTION OF LEASE REVENUE Given that this is the anniversary of the installation of the radios, the City also has the ability to exchange annual lease revenue for Metricom modems and services. Jim Slaughter, City of Dublin Computer Systems Specialist has suggested that this would allow the City the opportunity to provide Internet connections at remote facilities. It is envisioned that this will be a pilot project with the City receiving 5 subscriptions and modems in lieu of rental fees for 12 radio transmitters. The Agreement requires that this exchange be done in blocks of 5. Any subscriptions not assigned to remote locations could be assigned to other City workstations. The base Annual Fee paid by Metricom is $60.00 per transmitter. Although this fee is scheduled to increase based upon the change in the Consumer Price Index, the City has not yet been advised of the change. Based upon the current rate, the cost of providing Internet Access is approximately $12.00 per month for each of the five computers, which are proposed to be outfitted with the Metricom equipment. This would allow for an Internet e-Mail account and world wide web access at offsite locations such as Shannon Center, Senior Center, and the Heritage Center. The e-mail account can be particularly beneficial for both internal as well as external communications. The City would continue to receive from Metricom approximately $1,200 in Fee revenue for the remaining 20 transmitters. . -;1,- l , . . . RECOMMENDATION Review the request and authorize the City Manager to consent to the change in control as outlined in the letter from Metricom. The notice will only be executed provided that the fIrm is not in breach of the Agreement, including payment of any monies owed pursuant to the Agreement. In addition authorize Staff to exchange lease revenue from 12 antenna locations to provide a pilot project for 5 City workstations to be outfitted with Metricom modems and service. -::;- . . . J-~ M" .e ~), elflconl Hl::CEiVED ..lJ.\I~ 2 ~i .199B 0( CiTY Ur LJUL:lL/l\J !)BV U/livelsily Avc/lue Los G.1los, CA ,9SV3U / &tf /1 January 22, 1998 VIA OVERNIGHT MAIL Mr. Richard C. Ambrose City Manager City ofDublill 100 Civic Plaza Dublin, CA 94568 Re: Change in Control Request: Purchase of Shares of Metric om, Inc. Stock by Vulcan Ventures Incorporated Dear Mr. Ambrose: This letter follows a recent message left with your secretary by Jill Schwinn regarding the purchase by Vulcan Ventures Incorporated ("Vulcan") of shares of Metric om, Inc. conmlon stock (NASDAQ: MCOM). This letter is subn.itted pursuant to the requirements of Section 11 ( c) of the Agreement entered into by and between Metricom and the City of Dublin dated January 29, 1997 (the "Agreemenf'). As you will recall, Metricom is the leading provider of wide-area, high speed, portable wireless data services. Metricom's Ricochet Products and Services division, headquartered in Los Gatos, California, provides portable and desktop ,omputer users with high-performance, cost effective wireless access to the Internet, pri, ~te intranets, local-area networks, e-mail, real-time transactions such as stock trading and other online services. Vulcan was founded by new media investor Paul G. Allen in 1986 and is solely l?wned by Mr. Allen. Through Vulcan, Mr. Allen invests in companies that offer products, services or technologies that fit his wired world strategy, and can contribute to or benefit from tlle technology and strategy of other Paul Allen companies. Vulcan has been an investor in Metricom since 1993. '. , Telephone: 40So3j}9.S200 Fax: 408-354./024 EXHIBIT 1 January 22, 1998 Page Two In November, 1997, Vulcan purchased 2,583,500 shares of Metric om common stock from Lindner Investments in a privately negotiated transaction. Such purchase increased Vulcan's interest in Metricom from approximately 14% to approximately 33%. In addition, Vulcan is contractually committed to purchase an additional 4.65 million shares of Metric om common stock from Metricom in a private placement of securities, for $12.00 per share or $55,800,000 in the aggregate, increasing Vulcan's interest in Metricom to 49.7%. In connection with the latter purchase of shares, Metricom' s Board of Directors will ultimately be changed from nine members to seven members and four of such seats will be filled by persons nominated by Vulcan. Metricom has scheduled a meeting of its stockholders for January 30, 1998 to vote on the matters described in the previous two sentences. The transactions described in this paragraph are referred to below as the "Change in Control." The additional capital to be invested by Vulcan will help ensure that Metricom can deploy its next generation of high-speed wireless data networks rapidly and maintain its technology edge and market leadership and has been determined by Metricom's Board of Directors to be in Metricom's best interests. Inasmuch as the transactions described above constitute a change in control under the provisions of Section It(c) of the Agreement, Metricom hereby requests that the~c..-\o'7r indicate its consent to the Change in Control by countersigning the enclosed copy of this letter, faxing a copy to my attention at (408) 354-9537 as soon as possible, and returning the original to me at your earliest convenience. Please be advised of the following as required by Section 11 (b) of the Agreement: (i) Metricom is not currently in breach under the Agreement; (ii) Metricom' s financial condition immediately after the Change in Control would be considerably stronger than immediately prior to the Change in Control; ). rt J 1 . . . '34/1 . January 22. 1998 Page Three and (iii) Metricom's experience and technical qualifications should improve markedly as a consequence of the association with Vulcan because Metricom will enjoy the business experience and resources contributed by Vulcan and its officers. Vulcan's proposed business plan necessitates the hiring of additional engineers to develop the next generation Ricochet product, and a corporate relationship with Vulcan should assist Metricom in attracting and retaining highly qualified management personnel. Please do not hesitate to contact me at 408.399.8164 with any questions. . Sincerely. ~d~ Norine Luker Property Manager cc: Jill Schwinn City of Dublin hereby consents to the Change in Control described above. Dated: , 1998 By: Authorized Representative Printed Name & Title . . .. .'. PERMIT TO ATTACH, INSTALL, OPERATE AND MAINTAIN A WIRELESS DIGITAL COl\1MUNICATIONS RADIO NETWORIC &' . , This Permit, dated JANUARY ft, ~7 I, is issued by the City of Dublin to Metricom, ,If 4.11 , . . Inc. RECITALS WHEREAS, under California law, the City has the right and power to regulate the time, location, and manner of attacIunent, installation, operation, and maintenance of wireless digital communications radios in the public right-of-way withiD. the limits of the City; and WHEREAS, Metricom, Inc. wishes to attach, install, operate, and maintain a wireless digital conununications radio network on facilities located in the public right-of-way for purposes of operating its Ricochet wireless digital communications radio network; Now, THEREFORE, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, this Permit is issued under the following covenants, terms, and conditions: 1. Defmitions.. 1.1 "Agency" means any governmental agency or quasi-governmental agency ot4er . than the City, including the FCC and the PUC. 1.2 "City" means the City of Dublin. 1.3 "Effective Date" means the date first stated above. 1.4 "FCC" means the Federal Communications Commission. 1.5 "Fee" means any assessment, license, charge, fee, imposition, tax (but excluding any utility users' tax or franchise fees), or levy lawfully imposed by any governmental body. 1.6 "Laws" means any and all judicial decisions, statutes, constitutions, ordinances, resolutions, regulations, rules, tariffs, administrative orders, certificates, orders, or other requirements of the City or other Agency having joint or several jurisdiction over the parties to this Permit, in effect either at the time of execution of this Permit or at any time during the presence of Radios in the Public Right-of-Way. 1.7 "Metricom" means Metricom, Inc., a'corporation duly organized and existing under the laws of the State of Delaware, and its lawful successors, assigns, and transferees. f:c::a\dublin\consent3.doc [Rev: 7-30-96) 1/15/97 ... '."1 . 00()~ 50 EXHIBIT 2 . . , . . . .5r(/1 1.8 "PUC" means the California Public Utilities Conunission. . :.. 1.9 "Pennit" means this "Permit to Attach, Install, Operate, and Maintain A Wireless Digital Communications Radio Network". 1.10 "Person" means an individual, a corporation, a limited liability company, a general or limited partnership, a sole proprietorship, a joint venture, a business trust, and any other form of business association. 1.11 "Provision" means any agreement, clause, condition, covenant, qualification, restriction, reservation, term, or other stipulation in this Permit that defmes or otherwise controls, establishes, or limits the performance required or permitted by ~y party to this Permit. All Provisions, whether covenants or conditions, shall be deemed to be both covenants and conditions. 1.12 "Public Right-of-Way" means in, upon, above, along, across, under, and over the public streets, roads, lanes, courts, ways, alleys, boulevards, and places, including, without limitation, all public utility easements and public service easements, as the same now or may thereafter exist that are under the jurisdiction of the City. This term shall not include any property owned by any Person or Agency other than the City except as provided by applicable Laws or pursuant to an agreement between the City and any such Person or ~~~. . 1.13 <<Radio Month" means a calendar month during which a Radio occupies space on a City-owned pole or other property, even if such occupancy is less than the entire month. 1.14 <<Radios" means that radio equipment to be installed and operated by Metricom hereunder. 1.15 "Ricochet MCDN" means Ricochet MicroCellular Digital Network, a wireless dirital connnunications micro cellular radio network owned and operated by Metricom. 1.16 "Services" means the wireless digital connnunications services provided through Ricochet by Metricom. 2. TERM. This Permit shall be for a term of five (5) years, unless it is earlier terminated by either party in accordance with the provisions herein, and shall commence on the "Effective Date". This Permit shall automatically be renewed for two (2) successive (5) five-year terms by either party on the same terms and conditions as set forth herein (except that the Annual Fee shall be subject to adjustment as provided in Section 4.2) unl'ess either party notifies the other of its intention not to renew prior to commencement of a succeeding renewal term f:c:a \dublin\consent3 .doc [Rev: 7-30-96] 1/15/97 2 J II t "'0 . 3. SCOPE OF PERMIT. :. 3.1 Any and all rights expressly granted to Metricom under this Permit, which shall be exercised at Metricom' s sole cost and expense, shall be subject to the prior and continuing right of the City under applicable Laws to use any and all parts of the Public Right-of-Way only, exclusively or concurrently, with any other Person or Persons, and further shall be subject to all deeds, easements, dedications, conditions, covenants, restrictions, encumbrances and claims of title which may affect the Public Right-of-Way. Nothing in this Permit shall be deemed to grant, convey, create, or vest a perpetual real property interest in land in Metricom, including any fee or leasehold interest, easement, or any franchise rights. 3.2 The City hereby authorizes and permits Metricom to attach, install, operate, maintain, remove, reattach, reinstall, relocate, and replace Radios in or on City street light poles, lighting fixtures, electroliers, or other City-owned property located within the Public Right-of-Way for the purposes of providing Services to Persons located within or without the limits of the City. Any work performed pursuant to the rights granted under this Permit may, at the City's option, be subject to the prior review and approval of City. During the term of this Permit, the location of each Radio installed by Metricom or its designee shall be disclosed, in writing, to the City by Metricom within ten (10) days after its installation, removal, or relocation. Such identifications shall be incorporated in Exhibit A to ,this Permit. . 3.3 The City hereby authorizes and permits Metricom to attach, install, operate, maintain, remove, reattach, reinstall, relocate, and replace such number of Radios in or on street lights, utility poles or other property owned by Pacific Gas & Electric Company ("PG&E") or other entities or persons located within the Public Right-of-Way as might be permitted by PG&E or such other property owner(s). Metricom shall furnish to the City documentation of said permission from PG&E or the other property owner(s). 3.4 Except as permitted by applicable Laws or this Permit, in the performance and eXFrcise of its rights and obligations under this Permit, Metricom shall not interfere in any manner with the existence and operation of any and all public and private rights-of-way, sanitary sewers, water mains, storm drains, gas mains, poles, aerial and underground electric and telephone wires, electroliers, cable television, and other telecommunications, utility, and municipal property without the express written approval of the owner or owners of the affected property or properties. 3.5 Metricom shall comply with all applicable Laws in the exercise and performance of its rights and obligations under this Permit. 3.6 The City further reserves the right to modify the service voltage delivered to or at any street light pole or utility pole on which a Radio may be located. Metricom shall . replace or modify any Radio that will be affected by' such voltage modifications within thirty (30) days of receiving notice of voltage modifications. In the event that Metricom fails to f:ca\dublin\consent3.doc [Rev: 7-30-96] 1/15/97 3 . . . J~ ;J replace or modify any Radio within the thirty-day notice period before the voltage modification, the City may disconnect any such Radio until Metricom performs and completes the necessary work and advises City accordingly. ~ 3.7 If Metricom in performing under this Permit obtains PG&E's permission for Metricom to attach its Radips to PG&E's poles or other property, which poles or property are located within the Public Right of Way, City agrees not to use such PG&E permission to Metricom, or activities pursuant to this Permit, as a basis to challenge PG&E's Franchise Rights from the City, or as a reason for changing the amount of PG&E's payments under that Franchise to the City. 4. FEES AND TAXES. 4.1 Metricom acknowledges and agrees that the City may require users of revenue- producing services such as the Services to pay a utility users' tax ("Utility Tax") to the City pursuant to City's Municipal Code. If the Services are subject to the Utility Tax, Metricom agrees to collect the tax from Service users and remit such tax to the City in accordance with City's Municipal Code. 4.2 Metricom shall be solely responsible for the payment of all lawful Fees and for the payment of utility charges in connection with the exercise of Metricom I s right, title, and interest in, and the attachment, installation, operation, and maintenance of Radios; and the rendering of Services under this Permit. 4.3 Metricom shall pay to the City an annual fee (the" Annual Fee") in the amount of sixty dollars ($60.00) for the use of each City-owned pole or other property upon which a Radio has been installed pursuant to this Agreement. The initial Annual Fee shall be due and payable not later than the date of installation of the fIrst Radio under this Permit (the "Installation Date"), and shall equal the number of Radios Metricom then estimates it will install during the succeeding twelve (12) months multiplied by the Annual Fee. The Annual Fee for subsequent years shall be due and payable not later than thirty (30) days following eabh anniversary of the Installation Date and shall equal the total number of Radios then installed on City-owned poles or other property pursuant to this Permit multiplied by the Annual Fee, adjusted for the Prior Year Adjustment, as described immediately below. The Prior Year Adjustment shall either increase or decrease a subsequent year's aggregate Annual . Fee to account for the installation or removal of Radios during the prior year, and shall equal the difference between (i) the total number of Radios used to calculate the prior year's aggregate Annual Fee multiplied by twelve (12), and (ii) the actual number of Radio Months which occurred during such year, multiplied by one-twelfth of the Annual Fee. 4.4 The Annual Fee shall be increased effective January of the first year of each renewal term hereof based on the percentage change in the U.S. Department of Labor, Bureau of Labor Statistics, Consumer Price Index of all items, Base 1982-1984, for the San Francisco f:ca\dublin\conscnt3 .doc [Rev: 7-30-96] 1115/97 4 14/'7 - Oakland - San Jose Metropolitan Statistical Area which occurred during the previous term or . renewal term. :. 4.5 Notwithstanding Section 4.3: 4.5.1 In lieu .of the Annual Fee City shall be entitled to receive: 4.5.1.1 up to fifty (50) subscriptions to use Metricom's Ricochet Services in the City for so long as Metricom maintains Radios in use on the appropriate number of City-owned poles or other City-owned property pursuant to this Permit. Such option may be exercised by City in increments of one (1) subscription in lieu of the Annual Fee for one (1) Radio. Metricom shall provide such subscriptions at such time as Metricom is providing commercial service in the City, provided that prior to such service date City shall not be entitled to receive the Annual Fee or other compensation in lieu thereof. Metricom will not be required to pay the Annual Fee for the number of Radios installed on City-owned poles or other City-owned property equal to the number of subscriptions the City elects to receive as provided above. The number of Radios installed on City-owned poles or other City-owned property in excess of the number of subscriptions the City elects to receive shall be subject to the Annual Fee. City's use of the subscriptions shall be subject to Metricom's standard Ricochet Service terms and conditions. City shall be required to purchase at its sole cost and expense any equipment and software required to use the Ricochet Service; or 4.5.1.2 up to twenty (20) subscriptions to use Metricom's Ricochet Services and the use of up to twenty (20) Metricom mo..c!_ems, for so long as Metricom maintains Radios in use on the appropriate number of 0ty-owned poles or other City-owned property pursuant to this Permit. Such option may be exercised by City in increments of five (5) subscriptions and five (5) modems in lieu of Annual Fees for twelve (12) Radios. Metricom shall provide such subscriptions and equipment at such time as Metricom is providing commercial service in the City, provided that prior to such service date City shall not be entitled to receive the Annual Fee or other compensation in lieu thereof. The number of Radios installed on City-owned poles or other City-owned property in excess of the number of subscriptions/modems the City elects to receive shall be subject to the Annual Fee.' dty's use of the modems and subscriptions shall be subject to the standard terms and conditions set forth in the terms and conditions packaged with the modems. City shall be required to return to Metricom any equipment provided to City upon tennination of any free subscriptions in good condition, ordinary wear and tear excepted. . 4.5.2. City shall be required to make an election under this Section 4.5 within thirty (30) days of the Effective Date, or each anniversary of the Effective Date, as the case may be. Such election shall be applicable for the longer of the following one (1) year period or until a subsequent election is made in accordance with the previous sentence. 4.5.3. City shall use all subscriptions and equipment provided pursuant to this . Section 4.5 solely for its own use, and shall not be entitled to resell, distribute or otherwise permit the use of the same by any other party. f:l:a\dublin\conscntJ.doc [Rev: 7-30-96] 1/15/97 5 r elJ? . 4.6 Metricom shall reimburse City for their administrative expenses, up to a maximum of Five Hundred Dollars ($500). ;. 4.7 In accordance with the California Constitution and the California Revenue and Taxation Code, as such law~ are written on the date of this Pennit or, may be amended in the future; if the Alameda County Assessor determines that a possessory interest in publicly owned property has been granted by City to Metricom, Metricom shall be responsible for the payment of the full amount of the Possessory Interest Assessment. . 4.8 Notwithstanding any other provision of this Permit, Metricom acknowledges and agrees that City may enact legislation requiring providers of communications services such as Metricom to pay to City a franchise or other fee to compensate City fairly for the use of City'sl public rights of way with respect to the communications services provided therein or thereon. Metricom hereby agrees that Metricom's use of City's public rights of way shall be subject to any such franchise or other fee legislation enacted by City, and Metricom agrees to collect from the users of its Services and remit to City any such franchise or other fees, all in compliance with the applicable tenns and requirements set forth in the applicable provisions of the City Municipal Code. City recognizes Metricom's concern that its competitors be treated similarly with regard to any such franchise or other fees to access similar City facilities. City will make a reasonable effort to assure that such charges are equivalent, subject to allowances for the nature of City property utilized, the market demand for such use of such facilities, and the City's legal authority to impose suth charges. Notwithstanding the foregoing, such franchise or other fee shall not exceed five percent (5%) of Metricom's adjusted gross revenues. 5. REMOVAL AND RELOCATION OF RAmos. 5.1 Metricom understands and aclmowledges that City may require Metricom to relocate, and Metricom shall, at City's direction, relocate upon ten (10) business days' prior written notice in situations described in subsection (a) below, and immediately in situations described in subsections (b) and (c) below, at Metricom's sole cost and expense, a Radio whenever City reasonably determines that the relocation is needed: (a) to facilitate or accommodate the construction, completion, repair, relocation or maintenance of a City project, (b) because the Radio is interfering with or adversely affecting proper operation of City light poles, traffic signals or other City facilities, or (c) to protect or preserve the public health, safety, or welfare. If Metricom shall fail to relocate any Radios as requested by the City in accordance with the foregoing sentence, City shall be entitled to relocate the Radios at Metricom's sole cost and expense. . 5.2 In the event Metricom desires to relocate any Radios from one City-owned pole or other property to another City-owned pole or other property, Metricom shall so advise City. City will use its best efforts to accommodate Metricom by making another functionally equivalent City-owned pole or other property available for use in accordance with and subject to the terms and conditions of this Permit. f:ca\dublin\consen13.doc [Rev: 7-30-96} 1/15/97 6 !tJ 1/? 5.3 In the event that any Radio subject to this Permit is abandoned and no longer placed in service for a period-of six (6) months or more, Metricom promptly shall notify the City, and the City, at its option, may require Metricom to promptly remove the abandDned _. Radi6(s) at MetricDm's sole cost and expense or dedicate the same to the City. The City shall nDt issue notice to Metricom that the City intends tD exercise the Dption to require removal or dedication Df Radios, unless and until the City first gives fifteen (15) days' priDr written nDtice tD Metricom tD remove the Radios. If Metricom shall fail to remove the Radios as required by the City, the City shall be entitled to remove the Radios at Metricom' s sole cost and expense. Metricom shall execute such documents of title as will convey all right, title, and interest in the abandoned Radios, but in no other Metricom property, intellectual or otherwise, to the City . . 5.4 Whenever the removal or relocation of Radios is req~ired un.der this Permit, and such removal or relocation shall cause the Public Right-of-Way to be damaged, Metricom, at its sole cost and expense, promptly shall repair and return the Public Right-of-Way, in which the Radios are located, to a safe and satisfactory condition in accordance with applicable Laws, normal wear and tear excepted. If Metricom does nDt repair the site as just described, then the City shall have the option to perform or cause to be performed such reasonable and necessary work on behalf of Metricom and charge Metricom for the proposed costs to be incurred, or the actual costs incurred by the City, at City's standard rates. Upon the receipt of a demand for payment by the City, Metricom shall reimburse the City for such costs. . 6. CONSTRUCTION PERMIT. 6.1 In the event that the attachment, installation, operation, or maintenance of Radios shall require any construction work in the Public Right-of-Way, Metricom shall apply for the appropriate street opening and other permits required by law. 6.2 Upon the completion of construction work, Metricom promptly shall furnish to the City, in hard copy and Metricom's electronic format, suitable documentation showing the eXrct location of the Radios in the Public Right-of-Way. 7. INDEMNIFlCATION AND WAIVER. 7.1 Metricom agrees to indemnify, protect, defend (with counsel acceptable to the City) and hold hannless the City, its council members, officers, employees, and agents, from and against any and all claims, demands, IDsses, damages, liabilities, fmes, charges, penalties, administrative and judicial proceedings and orders, judgments, remedial actions of any kind, and all costs and cleanup actions of any kind, all costs and expenses incurred in connection therewith, including, without limitation, reasonable attorney's fees and costs of defense (collectively, the II Losses ") arising, directly or indir~ctly, in whole or in part, out of the . activities or facilities described in this Permit, except to the extent arising from or caused by f:ca\dublin\conscnt3.doc [Rev: 7-30-96] 1/15/97 7 . . . II 4 J/ the negligence or willful misconduct of the City, its council members, officers, employees, agents or contractors. :. 7.2 The waiver by the City of any breach or violation of any Provision of this Permit by Metricom shall not be deemed to be a waiver or a continuing waiver by the City of any subsequent breach or violation of the same or any other Provision of this Pennit by Metricom. 7.3 Metricom waives any and all claims, demands, causes of action, and rights it may assert against the City on account of any loss, damage, or injury to any Radio or any loss or degradation of the Services as a result of a sudden or gradual loss or change of electrical power caused by, among others, an Act of God, an event or occurrence which is beyond the reasonable control of the City, a power outage, a lightning strike, or occasioned by the installation, maintenance, replacement or relocation of any City-owned facility to which such Radio is attached. 7.4 The City shall be liable only for the cost of repair to damaged Radios arising from the sole or gross negligence or willful misconduct of City or its employees or agents, and the City shall not be responsible for any damages, losses, or liability of any kind occurring by reason of anything done or omitted to be done by the City or by any third party, including, without limitation, damages, losses, or liability arising from the issuance or approval by the City of a permit to any third party or any interruption in Services. 8. INSURANCE. 8.1 Metricom shall obtain and maintain at all times during the term of this Pennit comprehensive general liability insurance and comprehensive automotive liability insurance protecting Metricom in an amount of not less than one million dollars ($1,000,000) per occurrence (combined single limit), including bodily injury and property damage, and not less than one million dollars ($1,000,000) aggregate, for each personal injury liability, products- cOFPleted operations, and each accident. Such insurance shall name the City, its council members, officers, employees, agents, and contractors as additional insureds as respects any liability arising out of Metricom I s performance of work under this Permit, or suitable additional insured endorsement acceptable to the City. Coverage shall be provided in accordance with the limits specified and the Provisions indicated herein. Claims-made policies are not acceptable. When an umbrella or excess coverage is in effect, coverage shall be provided in following form. Such insurance shall not be canceled or materially altered to reduce coverage until the City has received at least thirty (30) days advance written notice of such cancellation or change. Metricom shall be responsible for notifying the City of such change or cancellation. 8.2 Metricom shall file the required original certificate(s) of insurance with endorsements with the City, subject to the City's prior approval, which shall clearly state: f:ca\dublin\consent3 .doc [Rev: 7-30-96] 1/15/97 8 /) ~/7 8.2.1 Policy number; name of insurance company; name, address and telephone number of the agent or authorized representative; name,. address and telephone number of insured; project name and address; policy expiration date; and :.. specific coverage amounts; . 8.2.2 That thirty (30) days prior notice of cancellation is unqualified as to the acceptance of liability for failure to notify the City; and 8.2.3 That Metricom's insurance is primary as respects any other valid or collectible insurance that the City may possess, including any self-insured retentions the City may have, and any other insurance the City does possess shall be considered excess insurance only and shall not be required to contribute with this insurance. The certificate(s) of insurance with endorsements and notices, shall be mailed to: rT~V rTFRK - CITY OF DUBLIN P.O. BOX 2340 (100 CIVIC PLAZA) DUBLIN, CA 94568 8.3 Metricom shall obtain and maintain at all times during the term of this Permit statutory workers' compensation and employer's liability insurance in an amount not less than five hundred thousand dollars ($500,000) or such other amounts as required by California law, . and furnish the City with a certificate showing proof of such coverage. . 8.4 Any insurance provider of Metricom shall be admitted and authorized to do business in California and shall be rated at least A:X in A. M. Best and Company's Insurance Guide. Insurance certificates issued by non-admitted insurance companies are not acceptable. 8.5 Prior to the execution of this Permit, any-deductibles or self-insured retentions must be stated on the certificate(s) of insurance, which shall be sent to and approved by the City. "Cross liability", "severability of interest II or "separation of insureds" clauses shall be m~~e. a part of the comprehensive general liability and comprehensive automobile liability polIcIes. 9. NOTICES. All notices which shall or may be given pursuant to this Permit shall be in writing and delivered personally or transmitted: (i) through the United States mail, by registered or certified mail, postage prepaid; (ii) by means of prepaid overnight delivery service; or (iii) by . f:ca\dublin\consent3 .doc [Rev: 7-30-96] IIlS/CJ7 9 . . . /~ 4/:/ facsimile transmission, if a hard copy of the same is followed by delivery through the U. S. mail or by overnight delivery service as just described, as follows: :. City ATTENTION: CITY MANAGER CITY OF DUBLIN P.O. BOX 2340 (100 CIVIC PLAZA) DUBLIN, CA 94568 Metricom Metricom, Inc. 980 University A venue Los Gatos, CA 95030 Attn: Property Manager Notices shall be deemed given upon receipt in the case of personal delivery, three (3) days after deposit in the mail, or the next day in the case of overnight delivery. Either party may from time to time designate any other address for this purpose by written notice to the other party in the manner set forth above. 10. TERMINATION. This Permit may be terminated by either party upon forty five (45) days' prior written notice to the other party upon a default of any material covenant or term hereof by the other party, which default is not cured within forty five (45) days of receipt of written notice of default (or, if such default is not curable within forty five (45) days, if the defaulting party fails to conunence such cure within forty five (45) days or fails to thereafter diligently prosecute such cure to completion), provided that the grace period for any monetary default is ten (10) days from receipt of notice. For purposes of the foregoing sentence, a default of a material covenant or term shall include, but not be limited to: (i) failure to pay any sums due hereunder prior to expiration of the foregoing ten-day grace period; (ii) failure to timely remove or relocate Radios as required hereunder; (iii) failure to comply with terms of this pdrmit, or of applicable laws, ordinances, codes or regulations, relating to public health and safety; (iv) failure to provide indenmity as required by Paragraph 7 hereof; or (v) failure to maintain the insurance required by Paragraph 8 hereof. 11. AS SIGNMENf. A. This License shall not be assigned or transferred by Metricom without the prior written consent of City, which consent shall not be unreasonably withheld, conditioned, or delayed. Metricom shall give City thirty (30) days' prior written notice of any proposed assignment or transfer for which City's consent is required hereunder. City shall give Metricom written approval or disapproval of any such proposed assignment or transfer within ninety (90) days after Metricom's request therefor, and City's failure to approve or deny any such request f:ca\dublin\consc:nt3.doc [Rev; 7-30-96] 1/15/97 10 '/ / "1" .. -.r., I !", .' !, . J ' , within such ninety (90) day period shall be deemed an approval. Metricom shall provide all information and documents reasonably requested by the City relating. to the transaction. Notwithstanding the foregoing, (i) the transfer of the rights and obligations of Metricom to a _, subsi<Jiary or other affiliate of Metricom, or to a commercial lending institution designated from time to time by Metricom or its affiliates as security for financing purposes, shall not be deemed an assignment or tr.ansfer for purposes of this License, and (ii) a change in control of Metricom (as defmed in Section lOC below) shall not be deemed an assigmnent or transfer for purposes of this License. B. Upon a change in control of Metricom (as defined in Section lIC below). City shall have the right, for a period of ninety (90) days after it receives notice of the occurrence of such change in control, to notify Metricom in writing of its intention to terminate this License effective no less than sixty (60) days after such written notice. Metricom shall provide all information and documents reasonably requested by the City relating to the transaction. Such termination shall not be effective. and this License shall continue in full force and effect in accordance with its terms, if, during such sixty (60) day period. Metricom provides City evidence reasonably demonstrating that: (i) Metricom is not then in breach of this License, and (ii) the financial condition of Metricom or any successor in interest to Metricom's rights under this License immediately after the change in control would be at least as strong as Metricom's financial condition immediately prior to the change in control. C. For purposes of this License, a "change in control" of Metricom shall mean the acquisition by any person (including any "group" within the meaning of Section B(d) of the Securities Exchange Act of 1934, as amended) of the power directly or indirectly, through the ownership of voting securities, by contract or otherwise, to direct the management and policies of Metricom; provided however that the ownership of more than fifty percent (50 %) of Metricom's outstanding voting securities shall be deemed, to constitute control, and the ownership of thirty percent (30%) or less of Metricom's voting securities shall be deemed not to constitute control. Metricom shall advise City whenever any person or "group" becomes the owner of more than thirty percent (30%) of Metricom's outstanding voting securities. 12. Miscellaneous Provisions. 12.1 City understands that Metricom will be operating in one or more bands of the radio spectrum for which no license from the FCC is required. Metricom understands that this Permit does not provide Metricom with exclusive use of any City-owned poles or property and that City shall have the right to permit other providers of telecommunications services to install equipment or devices in the Public Right of Way. However, City agrees to promptly notify Metricom of the acceptance of any proposal for the installation of communications equipment or devices in the Public Right of Way, irrespective of whether a license is required by the FCC for the operation thereof. In addition, City agrees to advise such other providers of telecommunications services of the presence or planned deployment of the Radios in the Public Right of Way. f:ca\dublin\eonsent3 .doc [Rev: 7-30-96) 1/15/97 11 . . . . . . 15 ~5{;/ ') 12.2 This Permit contains the entire understanding between the parties with respect to the subject matter herein. There are no representations, agreements or .understandings (whether oral or written) between or among the parties relating to the subject matter of this _. Perm!.t which are not fully expressed herein. 12.3 This Permit ~ay not be amended except pursuant to a written instrument signed by both parties . 12.4 If anyone or more of the Provisions of this Permit shall be held by court of competent jurisdiction in a final judicial action to be void, voidable, or unenforceable, such Provision(s) shall be deemed severable from the remaining Provisions of this Permit and shall in no way affect the validity of the remaining portions of this Permit. 12.5 Metricom shall be available to the staff employees of any City department having jurisdiction over Metricom' s activities 24 hours a day, 7 days a week, regarding problems or complaints resulting from the attachment, installation, operation, maintenance, or removal of the Radios. The City may contact by telephone the network control center operator at telephone number (800) 556-6123 regarding such problems or complaints. 12.6 This Permit shall be governed and construed by and in accordance with the laws of the State of California. In the event that suit is brought by a party to this Permit, the parties agree that trial of such action shall be vested exclusively in the state courts of California, County of Alameda, or in the United States District Court, Northern District of California. 12.7 All exhibits referred to in this Permit and any addenda, attachments, and schedules which may, from time to time, be referred to in any duly executed amendment to this Pennit are by such reference incorporated in this Permit and shall be deemed a part of this Permit. 12.8 This Permit is binding upon the successors and assigns of the parties hereto. 12.9 Metricom acknowledges that the City may develop rules, regulations, and sp~cifications for the attachment, installation, and removal of Radios and any similar purpose radios on the City-owned facilities, including poles, and such rules, regulations, and specifications, and when finalized, shall govern Metricom's activities hereunder as if they were in effect at the time this Permit was executed by the City; provided, however, that in no event shall such rules, regulations or specifications materially interfere with or affect Metricom's right to install Radios, or Metricom's ability to transmit or receive radio signals from Radios installed, pursuant to and in accordance with this Permit. 12.10 To the extent the City has actual knowledge thereof, the City will attempt to inform Metricom of the displacement of any pole on which any Radio is located. f;ca\dublin\consent3.doc [Rev: 7-30~96] 1115/97 12 It' ~;1 12.11 In any case where the approval or consent of one party hereto is required. . requested or otherwise to be given under this Permit. such party shall not unreasonably delay or withhold its approval or consent. .:. EXECUTED in CI~' of J)vtI;,Lil1. I LA on the date first above stated. CITY : [INSERT NAME] AT7"Gsr:~eL_c. ~ - . ~ By: J_ I . . (!/.-E; Title:RICHARD c. AMBRbs TY MANAGER . The Provisions of this Permit are agreed to and hereby accepted. METRICOM: METRICOM, INC. By: /J ~~ Kirk Wampler Director of Right of Way . . f:ca\dubUn\consent3.doc [Rev: 7-30-96] 1/15/97 13 l. _d' . . . ,<::>' 2/27/97 /1 vjI/ DUBLIN, CA .3~ r-o.d I' OS , ,I; eNa .. I SHADOW DR DUBLIN 4946 19970218 1..- 11852 DONLON WY DUBLIN 7242 2 19970218 1 7472 HANSEN DR DUBLIN 6746 0 19970218 .., LANDALE AVE DUBLIN 398 0 19970219 r; DOUGHERTY RD DUBLIN 7614 19970219 " 6392 SCARLElT CT DUBLIN 7237 19970219 :}- SCARLETT DR DUBLIN 7694 19970219 'i 8468 GALINDO DUBLIN 982 0 19970219 q 8018 CROSSRIDGE RD DUBLIN 7487 19970219 to AMADOR VALLEY BLVD DUBLIN 7403 13 19970219 if CROSSRIDGE RD DUBLIN 7494 19970219 n CARDIGAN ST DUBLIN 607 0 19970219 /3 7587 SILVERTREE LN DUBLIN 4971 9 19970219 Iy W VOMAC DUBLIN 5254 0 ' 19970219 6 SILVERGATE DR DUBLIN 7788 8 19970219 /. AMADOR VALLEY BLVD DUBLIN 7412 16 19970219 (;r SIERRA CT DUBLIN 7364 19970219 ("6 DOUGHERTEY RD DUBLIN 7626 19970219 IT AMADOR VALLEY RD DUBLIN 7390 19970219 pc, 11334 VILLAGE VIEW CT DUBLIN 7281 19970219 'U CLARK AVE DUBLIN 7717 19970219 'Zz. ARMADOR PLAZA DR DUBLIN 5077 20018 19970219 z:; STAGECOACH RD DUBLIN 6877 19970219 'Z..'f DUBLIN BLVD DUBLIN 7777 19970219 STARWARD DR DUBLIN 80 19970219 ze. 7254 BRIGHTON DR DUBLIN 2441 19970219 ").:f- 8482 NEWRY PL DUBLIN 1093 19970220 ~ 8144 ALDEA ST DUBLIN 2463 19970220 , BBB7 DAVONA DR DUBLIN 1310 19970220 0 6968 SIERRA CT DUBLIN 499B 19970220 l 6701 SEIRRA CT DUBLIN 7122 19970220 il 799B CASTILIAN RD DUBLIN 7319 19970220 7S V "L 3- '3> 3 EXHIBIT A - Metricom'Ri:dio Locations