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2.4. ERMUSR 09-11-2012 - Elk River Municipal Utilities UTILITIES COMMISSION MEETING TO: FROM: Elk River Municipal Utilities Commission Troy Adams, P.E. —General Manager John Dietz—Chair Daryl Thompson—Vice Chair Al Nadeau—Trustee MEETING DATE: AGENDA ITEM NUMBER: September 11, 2012 2.4 SUBJECT: Auburn Street Water Tower Lease Agreement with Sprint—Consent Letter Approval for Additional Lease Space BACKGROUND: In July 2011, ERMU executed an agreement with Sprint leasing antenna and equipment space at the Auburn Street Water Tower. DISCUSSION: Sprint is upgrading equipment and has requested consent for use of additional space. Staff and ERMU legal counsel have review the requested consent letter and our legal counsel has drafted a - modification of the Sprint consent letter which extends all the provisions of the original agreement to the additional lease. This modification has been reviewed by Sprint legal counsel. ACTION REQUESTED: Staff recommends the Commission authorize the execution of the modified consent letter. ATTACHMENTS: • Non-Exclusive Tower Attachment Lease Agreement for the Auburn Street Water Tower, executed by the ERMU Commission on July 17, 2011. • Proposed modifications to the Sprint Consent Letter for the Auburn Street Water Tower. RE3 Page 1oft P W OERED at �NATURE� Reliable Public Power Provider P D W E P E D i o S e A t withheld by Lessor in Lessor's sole discretion. Notwithstanding the foregoing, Lessee may make non-material modifications to Lessee's Equipment without consent,including but not limited to maintenance,repairs, like-kind or similar replacements of Equipment,provided none of the modified or replaced Equipment is larger than the Equipment approved by Lessor. If installation of the Equipment requires relocation of existing communication equipment (to include coax cable, antennae,brackets,hardware, etc.)owned by other communication carriers, Lessee shall be responsible for obtaining the consent of such carriers and all costs and labor associated with these modifications shall be the responsibility of the Lessee and shall be considered to be an integral part of this Lease. Any agreements among various communication carriers associated with these modifications shall be the responsibility of the Lessee. Lessee shall defend,indemnify and hold Lessor harmless from any claim made by such other carriers as a result of Lessee's acts or omissions. Prior to the installation of any Equipment, all installation plans,including plans for the attachment of Lessee's equipment,for the relocation of existing equipment owned by other carriers,for any modifications to the Water Tower,and for the installation of any personal property owned by the Lessee that is to be located on the Property or attached to the Water Tower,must be approved by Lessor,which approval may be conditioned or withheld by Lessor in Lessor's sole discretion. Lessor may also require proof of Lessee's ability to pay for all work to be performed on the Property,prior to the commencement of such work by Lessee or Lessee's contractors. Any personal property owned by Lessee,whether fixed or attached to the Property or the Water Tower, shall remain the exclusive property of Lessee, and the risk of loss to same will be solely Lessee's. No Equipment shall be permanently attached or welded to the Water Tower without Lessor's prior written approval. If welded attachments are approved,Lessee shall be responsible for the cost of replacing interior or exterior tank coatings that are damaged by welding. All replacement of coatings shall meet the exact specifications of the existing tank coaling, be performed by contractor's approved in advance by Lessor, and be completed within thirty(30) days of the lime that welding on the tank occurs. All costs associated with the new coatings,to include operational costs(i.e. draining elevated tank),shall be paid on demand by Lessee. Lessor grants Lessee limited access to the Water Tower and the Property for the purpose of installing,operating and maintaining the Equipment. Access shall be limited to such access as Lessor's authorized representative shall approve, in writing,which access shall be consistent with Lessee's need to install,operate and maintain the Equipment and Lessor's need to operate and maintain the Water Tower. Lessor shall have its personnel on site at any time Lessee is on the Property, and Lessee shall reimburse Lessor for Lessor's costs to have its personnel on site, including Lessor's on-call or overtime costs if Lessor's personnel are required to be on the site at times other than normal business hours. Lessee shall give Lessor 12 hours notice in a non- emergency situation,or 1 hour notice in an emergency situation,of its need to enter the Water Tower and Lessor shall arrange to have its personnel present. Under no circumstances shall Lessee or its employees or agents enter the Water Tower unless an employee if Lessor is present. -2- Lessee shall,prior to the installation of any Equipment on the Property,obtain all required land use approvals, building permits,and other governmental approvals required for installation and operation of the Equipment. Lessee shall also comply with all applicable governmental regulations regarding the installation and operation of the Equipment,including, without limitation,the requirements of the FCC,FAA, OSHA, and all other regulatory agencies with jurisdiction over the Equipment(collectively, the"Regulatory Requirements"). Failure of Lessee to comply with the Regulatory Requirements shall be a default,entitling Lessor to exercise the remedies hereinafter set forth including,but not limited to,termination of this Lease. Lessor agrees to cooperate with Lessee at no cost to Lessor with respect to obtaining any required zoning or other governmental approvals for the Site,the Facilities and contemplated use thereof. Furthermore, Lessee shall not allow its Equipment to interfere with the facilities of a user with a higher priority pursuant to Lessor's Policy Statement,or a user whose use of the Water Tower predates the Commencement Date of this Lease(such users being"Priority Users"). 3. Initial Tenn The Lease is effective upon full execution hereof. The initial term of this Lease("Initial Term")shall be for a period of five(5)years commencing on the earlier of i.)Lessee construction start or ii.)June 1,2010("Commencement Date"). Lessee may terminate the Lease for any reason or no reason prior to the Commencement Date,but agrees to reimburse Lessor pursuant to paragraph 5(c)hereof for all of Lessors costs incurred prior to such termination date. 4. Renewal Terms Subject to Lessor's right set forth in item(2)of the following paragraph, Lessee shall have the right to extend this lease four(4)times, for a period of five(5)years each(the "Renewal Terms"). The Renewal Terms shall be on the same terms and conditions as set forth in this Lease, except that rent shall be increased as provided in paragraph 5(b). This Lease shall automatically be renewed for the Renewal Terms unless: (1)Lessee notifies Lessor of Lessee's intention not to renew the Lease at least forty-five(45)days prior to the expiration of the Initial Term or the Renewal Term which is then in effect;or(2)Lessor notifies Lessee of Lessor's intention not to renew the Lease at least three hundred sixty(360) days prior to the expiration of the Renewal Term which is then in effect. 5. Consideration (a) Initial Term. Lessee shall pay to Lessor as rental the sum of Twenty Three Thousand Dollars ($23,000.00)per annum("Lease Payment"). The Lease Payment shall be increased annu�mmpcing one(1)year from the Commencemen Date of this Lease at the rate of o) Rent of the previous years rental. The Leas Payment shall be paid annually in advance with the first such annual payment due on the Commencement Date and thereafter on each anniversary of the Commencement Date, partial years to be pm-rated. (b) Renewal Term. In the event that Lessee elects to renew this Lease as provided in paragraph 4,the Lease Payment shall be increased each year of the Renewal -3- Terms (commencing with the first year of the first Renewal Term)at the rate of f vc(55 ) percent of the previous year's Lease Payment. (c) Reimbursement of Costs. In addition to the Lease Payments provided for in paragraphs 5(a)and(b)above, and any other costs of Lessee identified elsewhere in this Lease, Lessee shall reimburse Lessor for all of Lessor's costs to directly implement, administer,and enforce this Lease, with copy of detailed invoice submitted to Lessee from Lessor, including, without limitation: (i)Lessor's costs to retain a structural engineer or other consultant to review Lessee's plans for installation of the Equipment and to inspect the Equipment upon installation and annually, if determined necessary by Lessor;(ii)Lessor's costs to retain a Radio Frequency Engineer to identify or resolve any potential or actual interference issues with Lessee's Equipmentat the commencement of service by Lessee and at such other times as deemed necessary by Lessor; and (iii)Lessor's legal fees and other consultant costs associated with the negotiation, administration, and enforcement of this Lease. (d) Taxes. Lessee shall reimburse Lessor for any personal property or other taxes levied against the Property or Lessor as a result of the installation and operation of Lessee's Equipment on the Property. 6. Utilities Lessee,at Lessee's expense,will arrange for separate metering for all required electrical or other utility connections to support the Equipment, and shall promptly pay all utility costs directly to the utility providers when due. 7. Water Tower Purpose Lessee recognizes that the primary function of the Water Tower is to provide water storage for Lessor and its customers. Lessee understands that it will be necessary, from time to time, for Lessor to interrupt Lessee's use of the Property for maintenance of the Water Tower. Lessor shall provide Lessee with at least ninety(90)days prior written notice for non-emergency maintenance and,if requested by Lessor,Lessee agrees to remove its Equipment from the Water Tower for such length of time as Lessor shall require to complete the maintenance(the "Maintenance Period"). If required to remove its Equipment,Lessee shall have the right to temporarily relocate its Equipment as provided below. Alternatively,Lessee may terminate this Lease upon thirty(30)days written notice to the Lessor at any time during the Maintenance Period and neither party shall have any further rights or obligations arising hereunder,except Lessee shall have the duty to remove its Equipment as set forth herein,repairing any damage caused in the process, and the parties shall have those rights and obligations that are to survive the termination of this Lease. Lessee,at its sole cost and expense,may temporarily relocate its Equipment during a Maintenance Period to a different location on the Water Tower provided,however: a)that the duration of such relocation shall not exceed the Maintenance Period;b)that relocation space is available on the Water Tower at a location sufficient to meet Lessee's coverage or engineering needs and sufficient to allow the required maintenance to be performed by Lessor; c)that the -4- temporary location is not being used or intended to be used by Lessor, d)that the relocation will not cause interference with any other equipment located on the Water Tower; e)that the temporary location will not interfere with the Lessor's maintenance or use of the Water Tower; and f)that Lessor has approved relocation to the temporary location in writing. Alternatively, Lessee, at its sole cost and expense,may use a temporary transmission site, or Cellular on Wheels ("COW"),during the Maintenance Period,provided that the location of the COW is approved in writing in advance by Lessor. The cost of painting and repairing the Water Tower shall be borne by Lessor,unless damage to the Water Tower is caused by Lessee, in which case Lessee shall repair such damage or,at Lessor's option,reimburse Lessor for Lessor's costs and expenses incurred in such repair. The cost of painting Lessee's Equipment shall be borne by Lessee,and shall be performed routinely to maintain the appearance of the Equipment and shall be the same color as the Water Tower and must have prior written approval of Lessor. Lessor will not be responsible for damage to the Lessee's equipment while Lessor is performing maintenance on the Property or the Water Tower, except to the extent such damage is caused by the gross negligence or willful misconduct of Lessor. 8. Representations and Warranties of Lessee (a) Lessee represents and warrants that its installation,operation and maintenance of the Equipment shall comply with all Regulatory Requirements. (b) Lessee shall indemnify,defend and hold Lessor harmless from any claim against Lessor related to Lessee's installation,operation and maintenance of the Equipment, including, without limitation,any claims of contractors and subcontractors and/or any claims of any person or entity for damages or injury related to the installation, operation and maintenance of its Equipment. 9. Termination Except as otherwise provided herein,this Lease may be terminated upon written notice as follows: (a) By either party upon a default of any covenant or term hereof by the other party,which default is not cured within thirty(30) days of receipt of written notice of default(without,however,limiting any other rights available to the parties pursuant to other provisions hereof); (b) Upon thirty(30)days written notice by Lessee if Lessee is unable to obtain or maintain,through no fault of Lessee, any license,permit or other governmental approval necessary for the construction and operation of the Lessee's Equipment or business, including its ability to manage a PCS network pursuant to which the space is leased and the Equipment will be installed; or (c) By Lessor by giving Lessee twelve (12)months written notice that the Water Tower is going to be abandoned or relocated. -5- (d) By Lessee giving twelve(12)months written notice that use of the Property is unacceptable for technical reasons, including the Property being unacceptable as part of Lessee's network design as well as signal interference. (e) By Lessor by giving Lessee: (i) twelve(12)months written notice that a Priority User needs to use the Property for a use which is incompatible with Lessee's use of the Property; or(ii)thirty(30)days written notice that Lessee's Equipment is unreasonably interfering with the Equipment of a Priority User,provided that Lessor first gives Lessee written notice of such interference and thirty(30)days within which to resolve such interference with the Priority User. Lessee may terminate this Lease other than as expressly provided above at any time, so long as Lessee pays to Lessor as liquidated damages for early termination, twelve(12) months of the then current rent for the year in which Lessee terminates. Such payment shall be made within thirty(30)days of Lessee's written notice of termination. In the event of termination of this Lease,the Lessee must remove all of its Equipment from the Water Tower and the Property and return the Water Tower and the Property to their original condition(as of the Commencement Date of this Lease),normal wear and tear excepted. Lessee shall provide Lessor,at the Commencement Date of this Lease,a letter of credit or performance bond or cash("Security")in the amount of$10,000 to secure Lessees compliance with this requirement. The Security shall be kept current at all times that this Lease is in effect, and failure to keep the Security current shall constitute a default by Lessee. In addition to termination of this Lease, Lessor shall have all other rights and remedies available to it at law or in equity(including an action for money damages or injunctive relief) in the case of a Lessee default that remains uncured for a period of thirty(30)days after written notice to Lessee;provided however that if a non-monetary default cannot reasonably be cured within the 30-day period,this Lease may not be terminated if Lessee commences action to cure the default within the 30-day period and proceeds with due diligence to fully cure the default.. 10. Liability Insurance During the Initial Term and the Renewal Terms, Lessee shall maintain, at its own expense, insurance covering claims for public liability,personal injury, death and property damage under a policy of general liability insurance,with limits of not less than One Million Dollars($1,000,000.00)per person and Two Million Dollars($2,000,000.00)per occurrence, and property damage insurance of not less than Fifty Thousand Dollars ($50,000.00). Such insurance shall insure both Lessee and Lessor(as an additional insured)against liabilities arising out of or in connection with Lessee's use or occupancy of the Property subject to the standard exceptions found in the Commercial General Liability Insurance Policy. Landlord shall also carry general liability and property damage insurance. 11. Environmental Compliance Lessee warrants, represents and covenants that it will not bring on to the property,and its use on the Property will not generate, any Hazardous Materials. This Lease may be terminated by Lessor immediately if Lessee is responsible for Hazardous Materials being on the Property. -6- In such event Lessee shall be responsible for the removal of all such Hazardous Materials from the Property and shall be liable to Lessor for any costs incurred by Lessor to remove or clean up Hazardous Materials from the Property and shall indemnify, defend and hold harmless Lessor for any liability due to the Hazardous Materials being on the Property. Lessor represents and warrants to Lessee that it has no knowledge,having done no investigation relating thereto,of any substance, chemical or waste on or affecting Lessor's Property that is identified as hazardous, toxic or dangerous in any applicable federal,state or local law or regulation(collectively "Hazardous Materials"). 12. Interference Lessee covenants that the Equipment will not cause interference with the operation of any Priority Users. Lessee shall be responsible for curing any and all interference to the operation of equipment of Priority Users, so long as Priority Users are lawfully operating. Subsequent to the installation of the Lessee Equipment, other than Priority Users, Lessor will not permit its lessees or licensees to install new equipment on or make any alterations to the Water Tower, if such equipment or modifications cause interference with the operation of Lessee's Equipment. 13. Subrogation (a) In General. All insurance policies required under this Lease shall contain a waiver of subrogation provision under the terms of which the insurance-carrier waives all of its rights to proceed against Lessor or Lessee,as the case may be. (b) Mutual Release. Lessor and Lessee each release the other and their respective representative from any claims by them or anyone claiming through or under them by way of subrogation or otherwise for damage to any person or to the Property and to the fixtures, personal property, improvements and alterations in or on the Property that are caused by or result from risks insured against under any insurance policy carried by them and/or required by this Lease. 14. Notices All notices or demands by or from Lessor to Lessee,or Lessee to Lessor, shall be in writing. Such notices or demands shall be mailed to the other party at the following address: Lessor: Elk River Municipal Utilities 13069 Orono Pkwy Elk River,MN 55330 Attn: Director of Operations and Maintenance Lessee: Snrint/Nextel Property Services, Mailstop KSOPHT0101-Z26506391 6391 Sprint Parkway, Overland Park. Kansas 66251-2650 RE: MS80XC977-A(Elk River Auburn Street Watertank) -7- With Copy to: Sprint/Nextel Law Department, Mailstop KSOPHT0101-Z2020 6391 Sprint Parkway Overland Park, KS 66251-2020 Attn.: Real Estate Attorney RE: MS80XC977-A(Elk River Auburn Street Watertank) 15. Destruction of Premises If the Property or the Water Tower are destroyed or damaged so as to hinder the effective use of Lessee's Equipment on the Water Tower in Lessee's reasonable judgment, Lessee may elect to terminate this Lease as of the date of the damage or destruction by so notifying the Lessor. In such event,all rights and obligations of the parties to each other Lessee to Lessor shall cease as of the date of the damage or destruction(other than those obligations intended to survive the termination of the Lease), and Lessee shall be entitled to a pro rata reimbursement of any rent prepaid by Lessee. In the case of such termination, Lessee shall promptly remove its Equipment from the Property,repairing any damage caused in the process. 16. Title and Quiet Enjoyment Lessor warrants that: (i) it has the full right,power and authority to execute this Lease; and(ii) it has good and marketable title to the Property. 17. Assignment Lessee may not assign or sublet its rights under this Lease without the prior written consent of Lessor,which consent may be conditioned or withheld by Lessor,in Lessor's sole discretion. Notwithstanding the foregoing,Lessee may,without notice to or consent of Lessor, assign its rights under this Agreement in whole or in part to any entity controlling, controlled by or under common control with Lessee,any entity acquiring substantially all of the assets of Lessee,or any successor entity in a merger or consolidation involving Lessee. 18. Successors and Assigns This Lease shall run with the Property described on Exhibit"A"and shall be binding upon and inure to the benefit of the parties,their respective heirs,successors,personal representatives and assigns. 19. Miscellaneous (A) Each party agrees to furnish to the other,within twenty(20)days after receipt of written request, such truthful estoppel information as the other may reasonable request. (B) This Lease constitutes the entire agreement and understanding of Lessor and Lessee with respect to the subject matter hereof and supersedes all offers,negotiations and other -8- agreements. There are no representations or understandings of any kind not set forth herein. Any amendments to said Lease must be in writing and executed by Lessor and Lessee. (C) If either Lessor or Lessee is represented by a real estate broker in this transaction, that party shall be fully responsible for any fees due such broker and shall hold the other party harmless from any claims for commission by such broker. (D) This Lease shall be construed in accordance with the laws of the state in which the Property is situated. (E) If any term of this Lease is found to be void or invalid, such validity shall not affect the remaining terms of this Lease,which shall continue in full force and effect. (F) Lessor shall cooperate, at no cost to Lessor, with Lessee's efforts to evaluate the Water Tower and to comply with governmental regulations affecting Lessee's use of the Property by providing information about the Water Tower,the Water Tower's location and prior filings made by Lessor with governmental agencies. (0) Neither this Lease,nor a memorandum of same,shall be filed in the public records without the prior written consent of Lessor. (H) This Lease may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties, it being understood that all parties need not sign the same counterpart. -9- IN WITNESS WHEREOF, Lessor and Lessee have executed this Non-Exclusive Tower Attachment Lease Agreement as of that date and year first above written. LESSOR: Elk River Municipal Utilities By: L A I clt�r o4 rera•\iowy By: Its: .Ge.m.& .d u i • LESSEE: Sprint Spectrum L.P.,a Delaware limited partnership By: i liA Its: �,.�1 et 90g/tar r/ rl18 r`c= GP 2719758 v6 -Ip- Exhibit A TOWER ATTACHMENT LEASE AGREEMENT DESCRIPTION OF THE PROPERTY: SEC:26 TWP: 33 . 0 RG: 26 LOT: BLK: A ACRES : 1. 09 HILLSIDE ESTATES FOURTH ADDITION OUTLOT A • Exhibit B TOWER ATTACHMENT LEASE AGREEMENT DESCRIPTION OF EASEMENTS I2ft Non-Exclusive Access Easement and 8ft Non-Exclusive Utility Easement from Auburn Street to the Base of Water Tower Exhibit C TOWER ATTACHMENT LEASE AGREEMENT DESCRIPTION AND LOCATION OF EQUIPMENT See attached 5pg drwgs GP 2719758 v6 I • aw.ntn aCtwn°m uernrm wnn 0'space loan Oat/wvainnauown 3na w'uiau w a Qnram°ay tom unotwnuwmammon iuinma swam.va an..." tt { i fl i i /�{ 4,- i lamp IIIII i �}c I as t .1aai ! d .'L 9' SE;, "7 'li f vi erir - N i � IZ1 Ytl till alAiiI! mRa r • 7Q r 03 4 c I � e L ow a a � — �Z 49, �ay; y5 py u u 14 Y X Q hn it ; 1' gi/ A [l[�� ?iii, b e4a kb, F2 Ki °AC m�\ W G cQ 1 t2[ P a 40 & Eryn, ' J [ rg:u5 ,, a z 4 s W ¢ 4 a6s � \h1 3 1 g y I s 9 f k z._ pie_ , • i 71 a s 1 i ( 1 11 g1 1 Eiati • A t m , 41 W a p a1 1 axi [Y LU!I # aK .a Cr_• cn Q rOwpY LL: €'gig a �° Tg fil-z 3 (kZ r V2 ouzQ ! 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''�'rc�� 3t II 21 C wEpg M �c' ,'Lilt! �iI L II 1 tna l 9F , \ P m I 1141! 1 Q ``i :1 .� B a s r9 lik „:„. , 4 ; .., t \ , ;ti - Win ! : ttal in E 1 E 1 % Oti 4. 0 1 _ il 11 40041 4\\\', "P[;'2 Al 1 , 1 s Y i2 VII t 10 1 1 id g i { i � � g? d r 2. tv 11 r � i1 I r , , — 99NT�0 1i r_ 1 fi O(S AUTK � 1 � or tie il Z Y$ �� 9E r n O August 28, 2012 Selective Site Consultants 9225 Indian Creek Parkway, Suite 400 Overland Park, KS 66210 Re: Lease Agreement Between Elk River Municipal Utilities and Sprint Spectrum L.P., predecessor-in-interest to Sprint Spectrum Realty Company, LP, dated June 1, 2010 (Site Agreement), with respect to the real property located at 19533 Auburn Street NW (Site), Cascade No. MS80XC977 Dear Sirs: This letter will authorize Sprint Spectrum Realty Company, L.P., or its authorized agents (Sprint) to make the following modifications to the existing Sprint installation on the Elk River Municipal Utilities (ERMU)property located at 19533 Auburn Street NW, in the City of Elk River: • Install two new equipment cabinets; • Relocate three existing antennas; • Install three new antennas; and • Remove existing equipment cabinets Authorization to make these modifications is subject to the following conditions: 1. The Site Agreement identified above shall remain in effect at all times and all conditions of the Site Agreement shall be fully complied with at all times. 2. Prior to installing or removing any equipment cabinets or antennas at the site, Sprint shall submit to ERMU, and ERMU shall approve in writing, a new Exhibit C to the Site Agreement, which shall: • Identify the size and proposed location for the two new equipment cabinets, including temporary and permanent locations if Sprint proposes to move the new cabinets once the existing cabinets are removed; • Identify the size,type and proposed location of the three new antennas; • Identify the proposed location for relocation of the existing antennas; • Identify the proposed time schedule for: GRAY, PLANT, MOOTY, MOOTY 8 BENNETT, P.A. A FULL-SERVICE LAW FIRM MINNEAPOLIS, MN • Sr CLOUD. MN • WASHINGTON, DC WWW.GPMLAW.COM Page 2 August 28, 2012 i. Installation of the two new equipment cabinets; ii. Removal of the existing equipment cabinets; iii. Relocation, if planned, of the new equipment cabinets; iv. Relocation of the existing antennas; v. Installation of the new antennas; and vi. Removal of the existing antennas. 3. Sprint shall strictly follow the requirements of, and obtain the approvals required by, Section 2 of the Site Agreement. 4. Sprint shall reimburse ERMU for all of ERMU's costs to consider, prepare and administer this letter agreement modifying the Site Agreement, as provided in Section 5(c) of the Site Agreement, up to a maximum of$15,000. 5. In addition to reimbursement of ERMU's costs, Sprint shall pay additional rent to ERMU for the additional space taken by the replacement equipment cabinets and replacement antennas, in the amount of$1,917 per month in calendar year 2012, and $2,012 per month in calendar year 2013, for each month beginning with the month that replacement cabinets or antennas are brought on to the Site and ending with the month that all of the existing equipment cabinets and existing antennas are removed from the Site and Sprint has no more than three equipment cabinets and three antennas on the Site. The additional rent shall be due and payable on the same date as the base rent for 2012 and 2013, partial months to be pro-rated. 6. To secure Sprint's payment for reimbursement of costs and additional rental as provided in conditions 4 and 5 above, Sprint shall deliver to ERMU a performance bond in the amount of$30,000 prior to moving any additional equipment or antennas on to the Site. ERMU shall hold this performance bond until this Letter Agreement expires and may deduct from the performance bond all amounts due under conditions 4 and 5 above and unpaid at the time this Letter Agreement expires. Sprint shall remove the performance bond thirty (30) days following the expiration of this Letter Agreement. 7. This Letter Agreement modifying the Site Agreement shall expire on the earlier of: • The date all of the old equipment cabinets and old antennas are removed from the Site and Sprint has no more than three equipment cabinets and three antennas on the site; or • December 31, 2013. 8. This Letter Agreement shall not be modified in any way except in writing approved and signed by both parties. Page 3 August 28, 2012 ELK RIVER MUNICIPAL UTILITIES John J. Dietz, its Chair Troy Adams, its General Manager SPRINT SPECTRUM REALTY COMPANY, L.P. Selective Site Consultants, Inc., its authorized representative By: GP:3231364 vl