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HomeMy WebLinkAbout4577 � Contract Number: 4577 � Vendor: WAVE DIVISION IV LLC Subject: Wireless Internet Service � Department: Info Svcs File Class: LEG 12-1 Begin Date: 10/31/2006 End Date: 10/30/2009 Review Date: 02/15/2011 Vault Date: O1/O1/2011 Comments: Termination letter sent to Wave 7/28/09 INFORMATION TECHNOLOGY ManallflTl Bill Eley Wave Division IV, LLC 4519 S.E. Mile Hill Drive Port Orchard WA 98366 Attn: Jerry Rotondo and Gary B. Schrier July 28, 2009 Gary, It is with regret that I must give you notice of our decision to cancel contract #4577 we have with Wave Cable for the provision of wireless service to the City's downtown. The contract was due to be renewed at the end of October this year. That renewal is herby cancelled. We anticipate service to continue up to the renewal date (10/31/09). In these dire economic times, the wireless service is one of the services that the City can no longer afford to provide. ' At this point, we have no alternate plans for the wireless infrastructure that exists in the downtown. We may be open to negotiate continued use of the infrastructure by Wave if satisfactory terms for such use can be agreed upon.. I should like to thank you for your support in this project for the past three years and who knows, maybe there will be opportunities for further cooperation when the economy is back on its feet. Sincerely, '3JJ~ Bill Eley cc: Wave Division Holdings, LLC 401 Kirkland Parkplace, Suite 500 Kirkland WA 98033 Attn: Steve Weed and Jim Penney Vendor Subject Department Status Code Amount Begin Date End Date Review Date Insurance Comments Contract Number 4577 WAVE DIVISION IV LLC Wireless Internet Service Info Svcs SVC File Class LEG 12-1 $ 10/31/2006 10/30/2009 08/01/2009 GL $ AL $ E&O $ Insurance Total $ Insurance Review Date Automatic 3/yr renewal w/3yr additional unless 90 day notice given prior to end of term See contract for compensation WIFI SERVICE AGREEMENT This WiFi Service Agreement ("Agreement") is made this 31 st day of October, 2006 (the "Effective Date"), by and between W A VEDIVISION IV, LLC, a Washington limited liability company d/b/a Wave Broadband ("Wave") and the CITY OF BREMERTON, a municipality organized under the laws of the State of Washington (the "City"). Background The City issued a request for proposal dated May 24,2006 (the "RFP") for the construction and operation of wireless Internet access service facilities based on the Institute of Electrical and Electronics Engineers 802.IIx standard within an area of the City's downtown circumscribed by Washington Avenue (on the east), 6th Street (on the north), Pacific Avenue (on the west) and 1st Street (on the south) (such area being the "hot spot zone") to provide connectivity to pedestrians and other out-of-door users with wireless enabled devices (the "WiFi Facilities"). Wave provides video, data and voice services to customers in surrounding areas of Kitsap County, Washington and is the responder to the RFP selected by the City to construct and operate the WiFi Facilities for the City. Agreement For and in consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Wave and the City agree as follows: 1. Design and Construction ofthe WiFi Facilities. 1.1 Design and Performance Characteristics. Design of the WiFi Facilities will be performed by Wave and by qualified engineers and other professionals selected by Wave and reasonably acceptable to the City. The general design elements and performance characteristics of the WiFi Facilities are set forth on Exhibit 1.1. Wave will use its commercially reasonable efforts to provide end user connectivity throughout the entire hot spot zone, however, the City acknowledges the WiFi Facilities may not provide connectivity throughout the entire hot spot zone as a consequence of terrain and the proximity of buildings and other structures, current and future, that may effect signal propagation and reception. 1.2 Equipment Acquisition. Wave will arrange for and assist the City with the City's purchase the equipment designated in Exhibit 1.2 at the City's expense. Wave warrants that the equipment purchased by Wave to be incorporated in the WiFi Facilities will be new, unless otherwise specified, and in conformance with the specifications set forth in Exhibit 1.1. 1.3 Construction Activities. Construction of the WiFi Facilities within the hot spot zone will be performed by each of Wave and the City in accordance with the design and installation specifications and the allocation of installation responsibilities set forth on Exhibit g. Each of Wave and the City will reasonably cooperate with the other in the installation and construction activities. Construction specifications not otherwise set forth on Exhibit 1.1 will be governed by the requirements set forth in the latest edition of the National Electric Safety Code and the installation specifications provided by the equipment manufacturer and vendor. Wave WiFi Service Agreement and the equipment manufacturer or vendor will have the right to be present at the construction sites during all phases of the City's construction activities and the City will provide reasonable advance notice of its construction schedule and locations of such construction activities and will reasonably cooperate with Wave and the equipment manufacturer and vendor in such construction activities. The City will be responsible for and will bear all risk and liability associated with or arising from the safe installation of all equipment under its care provided to it by Wave and any loss, damage and replacement thereof, will be the responsibility of the City. 1.4 Construction Permits and Other Authorizations. The City, at its cost, will be responsible for issuing or otherwise obtaining all necessary permits, licenses or similar grants of authority necessary or convenient for the construction and placement of the WiFi Facilities, including all easements, rights-of-way and other access and attachment rights. Wave will cooperate and use its commercially reasonable efforts to provide the City with all information and documentation required to obtain any such permits, licenses or similar grants of authority needed to construct the WiFi Facilities. 1.5. Completion Target Date. The parties will use their respective commercially reasonable efforts to complete the construction of the WiFi Facilities within ninety (90) days of the Effective Date. 1.6 Testing of Completed WiFi Facilities. Upon completion of the construction of the WiFi Facilities, Wave and the City will, in accordance with the testing procedures to be set forth on Exhibit 1.6, test the WiFi Facilities to demonstrate to each party's reasonable satisfaction that the WiFi Facilities perform in accordance with the general design elements and performance characteristics of the WiFi Facilities (e.g., hot spot zone boundaries, bandwidth, etc.) set forth on Exhibit 1.1. 1.7 Acknowledgment of Performance. Upon completion of the testing described in Section 1.6, and the determination by the parties that the WiFi Facilities perform in accordance with the specifications set forth on Exhibit 1.1, the parties will complete and execute an "Initial Proof of Performance" form, substantially in the form of Exhibit 1.7. 1.8 Ownership of the WiFi Facilities. The City will have title to and ownership of the WiFi Facilities. For the elimination of doubt, nothing herein is intended to or shall be construed to convey title to or ownership of Wave's video, data and voice facilities. 1.9 Expansion of the WiFi Facilities. (a) At its option and its sole cost and expense, Wave will have the right to increase the number ofWiFi access points both within the hot spot zone and in any other area within the City limits. Any Wave-initiated increase in the number ofWiFi access points will (i) be made in coordination with the City, (ii) provide the "City-Free" service in a manner consistent with Exhibit 1.1, and (iii) be accompanied by an increase, as necessary and at Wave's expense, in the bandwidth capacity of Wave's backhaul facilities so as to provision the Deluxe service offered by Wave. (b) On the City's request and at the City's sole cost and expense, Wave will increase the number ofWiFi access points within the hot spot zone or to areas immediately 2 WiFi Service Agreement contiguous to the hot spot zone. Any such expansion ofthe hot spot zone will be subject to the mutual agreement of the parties as to the specific geographical locations, engineering and design characteristics and timing. On the parties' agreement to so expand the hot spot zone the term of this Agreement will be extended by a period of time to be mutually agreed by the parties, but in no event for less than one (1) year. In the event the number of access points is to be increased pursuant to either clause (a) or (b), the City will cooperate with Wave and the City will be responsible for issuing or otherwise obtaining for Wave all necessary permits, licenses or similar grants of authority necessary or convenient for the construction and placement of the additional WiFi access points on City-owned property, including all easements, rights-of-way and other access and attachment rights. 2. Operation and Maintenance of the WiFi Facilities. 2.1 Operation. Wave (directly or through vendors selected in Wave's discretion) will operate the WiFi Facilities for the City in accordance with the general operational plan set forth on Exhibit 1.1 throughout the Initial Term and the Extended Term, if any, of this Agreement. 2.2 Maintenance. Wave will maintain the WiFi Facilities in accordance with the standards set forth on Exhibit 1.1 throughout the Initial Term and the Extended Term, if any, of this Agreement; provided, however, that the City will pay Wave, within thirty (30) days of receipt of any such invoice, for maintenance or repair that may result from the City's, its employees' and agents' negligence or intentional misconduct. The City will immediately provide oral notice (promptly followed in writing) to Wave of any operational problems with the WiFi Facilities and will cooperate with Wave to effect any needed maintenance. Wave will co- ordinate in advance with the City of Bremerton Public Works Department any necessary maintenance, upgrade or other work to be done on any WiFi Facilities located on City-owned property; provided, in the event ofthe need for emergency repairs (in Wave's reasonable determination) Wave will exercise its commercially reasonable efforts to undertake such coordination in advance but may effect such repairs on an as-needed basis. Any failure of the equipment constituting the WiFi Facilities within the hot spot zone during the equipment manufacturer's warranty period will be replaced by Wave as promptly as reasonably possible, with costs and expenses paid by Wave for any WiFi Facilities located on non-City-owned property and with costs and expenses paid by the City for any WiFi Facilities located on City- owned property. Any failure of the equipment constituting the WiFi Facilities within the hot spot zone following the expiration of the equipment manufacturer's warranty period will be the sole responsibility of the City. 2.3 Exclusive Use ofWiFi Facilities; Access and Removal. Wave will have the exclusive use of the WiFi Facilities during the Initial Term and the Extended Term, if any, of this Agreement. Nothing herein will be deemed or construed to prevent Wave from entering into similar agreements with other parties with respect to the design, construction, deployment or use of any wireless Internet access facilities or other distribution facilities that are not the express subject of this Agreement. Prior to the termination of this Agreement in accordance with its terms, the City will have no right to access or remove City-owned equipment located on Wave property unless such access and removal is specifically approved by Wave in writing. Any access to or removal of City-owned equipment will be accomplished only at such times as are 3 WiFi Service Agreement mutually agreeable to the parties and only under the supervision of authorized representatives of both Wave and the City. 2.4 End User Services to be Provided by Wave. Wave will make the following services available to users within the hot spot zone at the following rates: Service Tier Bandwith Rate City-Free 384 kbps Free Deluxe 1.5 Mbps Fee service* * An end user service charge, determined by Wave, will be payable to Wave by the end users. Wave will be entitled to all revenues derived from the Deluxe service. 2.5 Advertisement of the WiFi Facilities. The City will be responsible for all costs associated with the design, fabrication and placement within the hot spot zone of any street- side signage indicating the presence of the City's zone's signal. 2.6 Splash Page. End users of the WiFi Facilities will be directed to a portal splash page the initial content and design of which will be developed by Wave and subject to the approval of the City, which approval will not be unreasonably withheld, delayed or conditioned. Subsequent revisions and updates to the splash page will be made on the mutual agreement of Wave and the City, with the costs of such revisions to be borne by the City except for revisions related to the addition or removal of advertising content which costs shall be shared equally by the parties. 3. Compensation. 3.1 To the City. As consideration of the City's construction obligations pursuant to Section 1.3, Wave will pay the City the sum of four thousand dollars ($4,000.00). Such payment will be due and payable within twenty (20) days following the parties' delivery of the Proof of Performance form pursuant to Section 1.7. Additionally, Wave will remit to the City fifty percent (50%) of the revenue (net of bad debt) derived by Wave from the sale of advertising on the splash page and other advertising carried on the WiFi Facilities. Such revenue sharing payments will be remitted by Wave on a monthly basis on or before the 25th day of the month following the month in which such revenue was generated. 3.2 To Wave. As consideration for Wave's obligations hereunder: (a) Wave will be entitled to retain for itself any and all payments made by end users ofthe WiFi Facilities and all other revenue generated from the WiFi Facilities including without limitation fifty percent (50%) ofthe revenue from the sale of advertising on the splash page and other advertising carried on the WiFi Facilities. (b) The City will pay Wave the following one-time fees for the services described: Fee $1,000.00 4 WiFi Service Agreement $12,250.00 $34,250.00 $750.00 Such one-time fees (plus any applicable Washington State sales tax) will be due and payable within thirty (30) days following the parties' delivery ofthe Proof of Performance form pursuant to Section 1.7. (c) For each month during the Initial Term and any Extended Term, the City will pay Wave the following monthly recurring fees for the services described: Service Internet Bandwidth (5 Mb s)* Ph sical Network Monitorin User Account Char es * * Fee $1,500.00 $150.00 Minimum fee $100.00 * At the City's request Wave will increase the Internet Bandwidth by an additional 5 Mbps for an additional monthly recurring fee of $1 ,500.00. ** The minimum User Account Charge will be 100.00 per month. The User Account Charge will be calculated in accordance with the formula set forth on Exhibit 3.2. The formula for the User Account Charge and the amounts to be paid by the City are based on the current arrangements Wave has in place with the third party vendor providing account management services. In the event such arrangements are changed or such account management vendor is replaced, Wave reserves the right to modify the formula and the amounts to be paid by the City. 4. Term of Agreement. This Agreement will commence as ofthe Effective Date and will continue for a period of three (3) years thereafter (the "Initial Term"); subject only to the termination provisions set forth in Section 8. This Agreement will extend automatically for an additional three (3) year term (the "First Extended Term") followed by an additional three (3) year term (the "Second Extended Term") on the same terms and conditions as set forth herein unless either Wave or the City notifies the other in writing, at least ninety (90) days prior to the end of the Initial Term or the end ofthe First Extended Term, as applicable, that it does not desire for the First Extended Term or the Second Extended Term t to take effect. Any portion of either the First Extended Term or the Second Extended Term is referred to herein as the "Extended Term". 5. Representations and Warranties. The following representations and warranties are material inducements for the parties to enter into this Agreement. 5.1 Wave represents and warrants to the City that: (i) Wave is a limited liability company formed and validly existing under the laws of the State of Washington, (ii) Wave has the power and authority to enter into this Agreement and to fully perform its obligation hereunder; (iii) Wave is under no contractual or other legal obligation which will in any way interfere with its full, prompt and complete performance hereunder; (iv) the individual executing this Agreement on behalf of Wave has the authority to do so; and (v) the obligations created by this Agreement, insofar as they purport to be binding on Wave, constitute valid and binding obligations of Wave in accordance with their terms 5 WiFi Service Agreement 5.2 The City represents and warrants to the Wave that: (i) the City is a municipal corporation existing under the laws of the State of Washington, (ii) the City has the power and authority to enter into this Agreement and to fully perform its obligation hereunder; (iii) the City is under no contractual or other legal obligation which will in any way interfere with its full, prompt and complete performance hereunder; (iv) the individual executing this Agreement on behalf ofthe City has the authority to do so; and (v) the obligations created by this Agreement, insofar as they purport to be binding on the City, constitute valid and binding obligations of the City in accordance with their terms. 6. Taxes. Each party will be responsible for all property taxes imposed on property owned by such party. For the elimination doubt, Wave will not be responsible for any property taxes related to the WiFi Facilities. 7. Insurance. Wave and the City each agree that they will obtain and maintain sufficient insurance coverage, or self insurance, to adequately protect their respective interests in the WiFi Facilities. 8. Early Termination of this Agreement. Each party reserves the right to terminate this Agreement at any time upon breach by the other party of a material term or condition of this Agreement, provided that the non-breaching party has first given sixty (60) days written notice specifying in reasonable detail the alleged breach or failure of compliance and demanding the cure of such breach or noncompliance (the "Breach Notice"). If said breach or failure to comply cannot reasonably be cured or substantially cured within sixty (60) days and the breaching party is proceeding to cure the same with due diligence, the time for curing such breach or failure to comply will be extended for such period of time as may be reasonably necessary to complete such cure. In the event this Agreement is terminated by either party, for any reason other than a breach by the other party, the non-terminating party will be entitled to any damages available to it at law or in equity. In addition, ifthe City terminates this Agreement at any time during the Initial Term for any reason other than a breach by Wave (such event being a "City Wrongful Termination"), the City will pay Wave the monthly recurring service fees set forth in Section 3.2(c) for each month through the remainder of the Initial Term. The parties have determined and agreed that the actual amount of damages that would be sustained by Wave in the event of a City Wrongful Termination would be difficult or impossible to ascertain. By placing their initials below, the parties acknowledge their agreement to this liquidated damages provision and acknowledge the payment to be made by the City is not intended as a forfeiture or penalty, but instead, is intended to constitute liquidated damages to Wave. City's initials: ~ Wave's initialS@- 9. Limitation of Liability. WAVE SHALL NOT BE LIABLE FOR ANY DAMAGES, CLAIMS, EXPENSES, LIABILITIES OR LOSSES, INCLUDING BUT NOT LIMITED TO, LOSS OF INCOME, REVENUE OR BUSINESS FOR (i) FAILURE TO TIMELY FURNISH SERVICES, (ii) INTERRUPTION OF ANY SERVICES, (iii) NETWORK OUTAGES, (iv) FAILURES OR ERRORS IN SIGNAL OR DATA TRANSMISSION, (v) EQUIPMENT FAILURES OR OBSOLENCE (vi) LOSS OR DEGRADATION OF DATA, INFORMATION OR FILES, (vii) 6 WiFi Service Agreement ANY SOFTWARE DAMAGE OR LOSS REGARDLESS OF THE CAUSE, OR (vii) ANY CONDITIONS OF FORCE MAJUERE. UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, PUNITIVE, OR INCIDENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOSS OF GOODWILL OR LOST PROFITS ARISING IN ANY MANNER FROM THIS AGREEMENT, WHETHER OR NOT FORESEEABLE OR EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE MAXIMUM AGGREGATE LIABILITY TO W AVE FOR DAMAGES RELATED TO THIS AGREEMENT OR ANY SERVICES WHICH ARE THE SUBJECT MATTER OF THIS AGREEMENT, WHETHER FOR BREACH OF CONTRACT OR WARRANTY, STRICT LIABILITY, NEGLIGENCE OR OTHERWISE, SHALL NOT EXCEED THE TOTAL AMOUNT PAID BY THE CITY TO WAVE PURSUANT TO SECTION 3.2(c) OF THIS AGREEMENT IN THE TWO (2) MONTH PERIOD IMMEDIATELY PRECEEDING THE OCCURRENCE OF THE EVENT GIVING RISE TO THE CLAIM. EACH OF THE PARTIES ACKNOWLEDGES AND AGREES THE LIMITATIONS OF LIABILITY SET OUT IN THIS SECTION ARE AN ESSENTIAL ELEMENT OF THE AGREEMENT BETWEEN THE PARTIES AND THAT IN THE ABSENCE OF SUCH LIMIT A TIONS THE OTHER TERMS, INCLUDING WITHOUT LIMIT A TION THE FINANCIAL TERMS, SET FORTH IN THIS AGREEMENT WOULD BE SUBSTANTIALLY DIFFERENT. 10. Disclaimer of Warranty. WAVE MAKES NO WARRANTY, WHETHER EXPRESS OR IMPLIED, OR STATUTORY, INCLUDING AS TO THE MERCHANTABILITY OR FITNESS FOR A PURPOSE, OF THE WIFI FACILITIES OR (EXCEPT AS SPECIFICALLY STATED IN THIS AGREEMENT) AS TO ANY OTHER MATTER, ALL OF WHICH WARRANTIES ARE EXCLUDED AND DISCLAIMED. 11. Proiect Managers. Each of Wave and the City will designate a qualified full-time employee who will serve as its on-site Project Manager. The parties' respective Project Managers will be responsible for the general administration of all matters relating to the construction and operation of the WiFi Facilities and be the primary source of, and contact for, all reports and other communications between the parties under this Agreement. Such authorized representatives will undertake to answer questions posed by the other party, will examine any documents and/or proposals submitted by the other party and will promptly render answers or decisions pertaining thereto to avoid delay in the orderly progress of the construction, operation and maintenance of the WiFi Facilities. The parties initially designate the individuals named in the table below as Project Managers; however, either party may substitute individuals of equivalent position and responsibility as needed by providing notice of same to the other party in accordance with the notice provisions of the Master Agreement. Wave's Proiect Manager Gary B. Schrier Phone: 360-871-5618 x.1704 Cell Phone: 360-340-1067 City's Proiect Manager Bill Eley Phone: 360-473-5293 Cell Phone: 7 WiFi Service Agreement Fax: 360-871-5418 Emai1: garys@wavebroadband.com Fax: 360-473-5470 Emai1: bill.eley@ci.bremerton.wa.us 12. Environmental Matters. 12.1 Definitions. For purposes of this section, the following terms will have the following meanings: 12.1.1 "Hazardous Substance" means any chemical, substance, material, or waste that is defined, classified, listed, or designated as hazardous, toxic, or radioactive, or by other similar term, by any Environmental Laws presently in effect or promulgated in the future, and as amended from time to time. 12.1.2 "Environmental Laws" means all laws and regulations relating to emissions, discharges, releases or threatened releases of pollutants, contaminants, chemicals or industrial, hazardous or toxic materials or wastes into the environment (including without limitation the atmosphere, ambient water, surface water, ground water or land surface or sub-surface) or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of pollutants, contaminants, chemicals or industrial, hazardous or toxic materials or wastes or any regulation, order, decree or judgment issued, entered, promulgated or approved thereunder. 12.2 Environmental Matters Indemnification. The City will indemnify and hold . harmless Wave and its employees, representatives and agents from and against any and all claims, demands, damages, losses, liens, liabilities, penalties, fines, lawsuits and other proceedings, and costs and expenses, including without limitation attorneys' and other experts' fees and disbursements, with respect to: (i) any activity that has occurred or that may occur during the City's, possession, control, or occupation of any of its properties, which activity results in or has resulted in the contamination of any of its properties by any Hazardous Substance or the violation of any Environmental Laws, except to the extent such activity was undertaken by Wave; (ii) the discovery of any Hazardous Substance on any of the City's properties, except to the extent the presence of such Hazardous Substance was caused by the activities of Wave; and (iii) the removal, remediation, abatement, containment, or cleanup of any Hazardous Substance from any of the City's properties including but not limited to the asbestos abatement procedures described in Section 12.3 except to the extent the presence of such Hazardous Substance was caused by the activities of Wave. 12.3 Asbestos Abatement. In connection with the construction at or within any of the City's property the City will be responsible at its sole expense for engaging an asbestos abatement contractor, which has been duly licensed by all appropriate governmental entities. Notwithstanding anything else in this Agreement to the contrary, such contractor will perform all asbestos removal, remediation, abatement, containment and cleanup activities, procedures, practices and requirements that are required under the Environmental Laws or that are otherwise necessary or appropriate for the safety of all Wave and other personnel involved in the construction and operation ofthe WiFi Facilities. 13. Exhibits. Each ofthe Exhibits listed below is hereby incorporated into and for all purposes be deemed a part of this Agreement: 8 WiFi Service Agreement Exhibit 1.1 -- Design and Performance Characteristics Exhibit 1.2 -- Equipment to be Purchased Exhibit 1.6 -- Testing Procedure Exhibit 1.7 -- Initial Proof of Performance Exhibit 3.2 -- Calculation of User Account Charges Any of such Exhibits may be later amended or revised by the mutual consent of the parties and such Exhibit, as so amended or revised, will be incorporated into and for all purposes be deemed a part of this Agreement. 14. Miscellaneous. 14.1 Governing Law and Venue. The validity, construction and enforcement of this Master Agreement will be governed by the laws of the State of Washington without giving effect to conflicts of laws principles. If any action or other proceeding will be brought by either party in connection with this Agreement, the venue of such action will be in Kitsap County, Washington and each party hereby consents to the personal jurisdiction of the Superior Court of Kitsap County and the United States District Court for the Western District of Washington. 14.2 No Waiver of Breach. Failure by any party to insist upon the strict performance of any covenant, agreement, term or condition of this Agreement, or to exercise any right or remedy due to breach, will not constitute a waiver of any breach or any subsequent breach of such covenant, agreement, term or condition or a relinquishment of any right to assert or rely on any such covenant, agreement, term or condition. 14.3 Notices. Any notices or other communications required or permitted under, or otherwise in connection with this Agreement will be in writing and will be deemed to have been duly given (i) when delivered in person, or (ii) upon confirmation of receipt when transmitted by facsimile transmission (but only if followed by transmittal by national overnight courier or hand for delivery on the next business day), or (iii) on receipt after dispatch by registered or certified mail, postage prepaid, or (iv) on the next business day if transmitted by national overnight courier, in each case addressed as follows (or to such other address which has been delivered in accordance with this Section 14.3): If to Wave: WaveDivision IV, LLC 4519 S.E. Mile Hill Drive Port Orchard, Washington 98361 Attention: Jerry Rotondo and Gary B. Schrier Fax: 360-871-5418 With a copy to: WaveDivision Holdings, LLC 401 Kirkland Parkplace, Suite 500 Kirkland, Washington 98033 Attention: Steve Weed and Jim Penney Fax: 425-576-8221 If to the City: City of Bremerton 9 WiFi Service Agreement 345 6th Street, Suite 600 Bremerton, WA 98337-1873 Fax: 360-473-5470 With a copy to: 14.4 Attorney's Fees. If either party brings a legal proceeding to enforce, interpret or to obtain a declaration of its rights under this Agreement, the substantially prevailing party in such legal proceeding will be entitled to recover its reasonable attorneys' fees and costs incurred in the proceeding from the non-prevailing party. 14.5 Counterparts. This Agreement may be executed in any number of counterparts each of which, when executed and delivered, will be deemed to be an original, and all of which, taken together, will be deemed to be one and the same document. This Agreement and any document required to be signed pursuant to this Agreement will be considered properly signed if signed personally or by facsimile (fax). 14.6 Entire Agreement/Amendments. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior or contemporaneous written or oral agreements and representations between the parties with respect thereto, including without limitation Wave's response to the RFP. No provisions of this Agreement may be modified or amended except by an agreement in writing signed by both parties or their respective permitted successors and assigns. 14.7 Use of Name or Marks. The City will have no right to use the name "Wave Broadband" or any or Wave's trademarks, service marks, symbols, insignia, or other distinguishing marks without the express prior written consent of Wave. 14.8 Interpretation. The headings of the sections of this Agreement are for convenience only. Such headings do not purport to, nor will be construed to, define, limit, or extend the scope of the sections to which they pertain. In the event of an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement. 14.9 Relationship of the Parties. Nothing herein will be deemed or construed to create or constitute a partnership, joint venture or agency relationship between the parties. Neither party is authorized to hold itself out or to act toward third parties or the public in any manner that would indicate the existence of any such relationship with the other. 14.10 Severability. In the event that anyone or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the parties will negotiate in good faith with a view to the substitution therefor of a suitable and equitable solution in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid provision; provided, however, that the 10 WiFi Service Agreement validity, legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein will not be in any way impaired thereby, it being intended that all of the rights and privileges of the parties hereto will be enforceable to the fullest extent permitted by law. 14.11 Assignment. This Agreement and the rights and obligations of the parties hereunder may not be assigned or delegated, in whole or in part, voluntarily or by operation oflaw, by either party without the prior written consent of the other party, which consent will not be unreasonably withheld, delayed or conditioned. 14.12 Further Assurances. From time to time, upon the written request of a party, the other party will execute, deliver and acknowledge or cause to be executed, delivered and acknowledged, such further agreements, documents, and instruments and to do such other acts and things as the requesting party may reasonably request in order to fully effect the intent of this Agreement. 14.13 Captions and Headings. The captions and headings are inserted in this Agreement for convenience only, and will in no event be deemed to define, limit, or describe the scope or intent of this Agreement, or of any provision hereof, nor in any way affect the interpretation of this Agreement. 14.14 Force Maieure. No party will be considered in default in the performance of any of its obligations hereunder to the extent that the performance of such obligations, except the paYment of money, is prevented or delayed by any cause beyond the reasonable control of the affected party, including, but not limited to, acts of God, acts of a public enemy, terrorists, war, riots, epidemics, earthquakes, fires, severe rainstorms, ice storms, snow-storms, hurricanes, blizzards, and other severely inclement weather, washouts, sinkholes, civic disturbances, explosions, strikes, lockouts, union or other labor disputes, inability to obtain or maintain permits or rights-of-way, inability after reasonable effort in the exercise of due diligence to obtain parts or materials or equipment, actions of utilities (not to be construed to include the parties), and any other cause not within the reasonable control of the parties (any such event being hereinafter referred to a "Force Majeure Event"). Each party will give notice promptly to the other of the nature and extent of any event of Force Majeure Event claimed to delay or prevent its performance under this Agreement. 11 WiFi Service Agreement [Signature Page] IN WITNESS WHEREOF, the authorized representatives of the parties have executed this Agreement as of the Effective Date. City: Wave: W A VEDIVISION IV, LLC By ,4~....tA'~ Name Printed .. ~ - JIiJ 0 Title: ----u-p. W~~NL p(Jl<~' 12 WiFi Service Agreement EXHIBIT 1.1 This is Exhibit 1.1 to that certain WiFi Service Agreement, dated October 31, 2006 ("Agreement"), between WaveDivision IV, LLC ("Wave") and the City of Bremerton (the "City"). General Desi2n and Operatin2 Characteristics PHYSICAL. The primary function ofthe city of Bremerton WiFi hot spot zone ("Zone") is to provide a free-to-the-end-user, outdoor 802.11 x wireless signal within a specified downtown core perimeter for connectivity to the Internet. Within the Zone, electro-magnetic radio waves will be emitted from transceivers or access points ("AP") located on the periphery ofthe Zone. The AP locations are identified approximately as follows: a. Kitsap Transit Kitsap Convention Center, roof, south end; b. Kitsap Transit Kitsap Convention Center roof, north end; c. City of Bremerton parking garage 5th & Washington, light pole, top level; d. City of Bremerton naval museum, building 50, roof; e. City of Bremerton light pole 6th & Pacific, NW comer; and f. City of Bremerton light pole Burwell & Pacific, NE comer. AP sites (a) and (b) will be installed by Wave; AP sites (c), (d), (e) and (f) will be installed by the City. The APs will be powered at their mount, each location, by a GFCI. The APs interconnect amongst themselves to create a wireless mesh for signal transmission to an intermediate backhaul location mounted on the water-side ofthe Kitsap Convention Center. From this point, all Zone traffic is transmitted across Sinclair Inlet to a second and final backhaul radio located within Port Orchard secured to Wave fiber-optic plant for relay to their headend and subsequent transport to the nearest point of presence at the Westin Building, Seattle. Total network bandwidth is originally set at 5.0/5.0 Mbps. Because of the Zone's varying topography, signal strength will be inconsistent but should be sufficiently strong and available throughout for the user to have a satisfying connection experience. Signal dead spots discovered pre- or post-activation of network will attempt to be remedied by the adjustment or re-location of an AP( s) or by the placement of a new AP(s) acquired by the City, following the effective date of the Agreement. The Zone can be expanded beyond its original perimeter by the placement of new APs within signal range of any existing AP. BACK OFFICE. All user accounts, free-to-the-end-user and fee-based, will be provisioned and controlled through a gateway managed by Wave or its designated contractor. The gateway has the capability to manage up to 200 simultaneous users' connections to the Internet. The gateway will provision a user-selected account type, one named "City-Free" at a connection speed of 384 Kbps at no charge to the end user, or one named "Deluxe" at a connection speed of 1.5 Mbps on a sliding charge scale based on a time interval selected by the end user. Each City-Free account will be established at maximum of300 minutes for any 30-day calendar period. Both account types will accrue a pro rata monthly charge based on usage. Usage beyond 300 minutes triggers a new 300-minute account. 13 WiFi Service Agreement USER EXPERIENCE. End users will make connections within the Zone with any 802.llx wireless-enabled device. By selecting the "City of Bremerton WiFi Hot Zone" signal they will be directed to a portal splash page. There, the user will be exposed to City-selected advertising content with a choice of either City-Free or Deluxe service tiers. End users selecting the Deluxe tier will make a secure credit card payment. On either tier, once a selection has been made the end user will sign on as new accounts selecting a user name and password. A new account will then be created after the end user has accepted the Terms and Conditions of Use. The end user's browser will then direct them to either the City's home page or they will be "landed" at the page of the Zone's sponsor advertiser. 14 WiFi Service Agreement EXHIBIT 1.2 This is Exhibit 1.2 to that certain WiFi Service Agreement, dated October 31, 2006 ("Agreement"), between WaveDivision IV, LLC ("Wave") and the City of Bremerton (the "Ci ty"). EQuipment Purchased bv City Wave will facilitate the acquisition of the following equipment, which will be purchased and owned by the City at the City's expense: Manufacturer Product Description / Part No. Ouantity BelAir Networks BA 50c, ARM3, Ilb/g 5 BelAir Networks BAI00, ARM3, 11 big, BRM2 1 BelAir Networks BAI00s, BRM2 (Fiber) 1 BelAir Networks License, NMS 1-10 Devices 1 BelAir Networks BAI00 Mount BracketINo Tilt 1 BelAir Networks BAI00 8 dbi Ext. Omni Access Ant. 1 BelAir Networks BA 100 8 dbi Access Ant. 2 BelAir Networks BAI00 Strand Mount/Plant Power 1 Nomadix AG 3000 incl. NSE Core 1 N omadix Software Package @ 100 Users 1 N omadix 3000: 50-User Upgrade 2 N omadix 3000: Premium Support 1 15 WiFi Service Agreement EXHIBIT 1.6 This is Exhibit 1.6 to that certain WiFi Service Agreement, dated October 31, 2006 ("Agreement"), between WaveDivision IV, LLC ("Wave") and the City of Bremerton (the "City"). Testin2 Procedure To be discussed by the parties. All test results will be documented for future reference. 16 WiFi Service Agreement EXHIBIT 1.7 This is Exhibit 1.7 to that certain WiFi Service Agreement, dated October 31, 2006 ("Agreement"), between WaveDivision IV, LLC ("Wave") and the City of Bremerton (the "City"). Initial Proof of Performance On this day of , 200_, the parties have completed testing of the WiFi Facilities (as defined in the Agreement) in accordance with the testing procedures set forth in Section 1.6 ofthe Agreement and the parties are reasonably satisfied that the WiFi Facilities perform in accordance with the specifications set forth in Section 1.1 of the Agreement. City: THE CITY OF BREMERTON, WASHINGTON By Name Printed Title: Wave: W A VEDIVISION IV, LLC By Name Printed Title: 17 WiFi Service Agreement .. EXHIBIT 3.2 This is Exhibit 1.7 to that certain WiFi Service Agreement, dated October 31, 2006 ("Agreement"), between WaveDivision IV, LLC ("Wave") and the City of Bremerton (the "City"). Calculation of User Account Chan!es City will pay Wave the following user account fees (the "License Fee" or "LF") during the Term and any Extended Term. The License Fee will be the greater of $1 00.00 or the amount calculated by the following formula: LF = NA x P A, where NA is the total number of active end user accounts (less Deluxe accounts) each month and PAis the price per account set forth in the grid below. An end user account will be deemed "active" ifthe end user accesses the Internet or the WiFi Facilities' administrative interface during any calendar month. For billing purposes, an account is considered to be 300 minutes, and is automatically rolled over into a new 300-minute account as the user logs 301 minutes in any calendar month. An account's unused minute balance will not carry forward at the start of a new calendar month. (Users with City-Free accounts will have no requirements as to account regeneration, i.e., no new log-on.) The number of unique MAC addresses that use the account in any calendar month will be the number of accounts attributable for billing purposes. Accounts with usable time (consumable or lifespan) of 300 minutes or less will be treated as a fractional account (number of minutes divided by 300), with a minimum monthly charge per account of sixty (60) minutes. No. of Accounts Monthly Price Per Account 1 - 249 $1.00 250 - 499 $0.95 500 - 999 $0.90 1,000+ $0.85 18 WiFi Service Agreement