HomeMy WebLinkAboutAgenda Report - February 1, 2017 C-11TM
CITY OF LODI
COUNCIL COMMUNICATION
AGENDA ITEM
C -'i
AGENDA TITLE: Adopt Resolution Authorizing City Manager to Execute Amendment to Lease Agreement
with NCWPCS MPL 24 — Year Sites Tower Holdings, LLC, a Delaware Limited Liability
Company, by and through its Attorney -In -Fact, CCATT, LLC, a Delaware Limited Liability
Company, for Option and Site Lease Agreement at 1331 South Ham Lane
MEETING DATE: February 1, 2017
PREPARED BY: Public Works Director
RECOMMENDED ACTION: Adopt resolution authorizing City Manager to execute Amendment to
Lease Agreement with NCWPCS MPL 24 — Year Sites Tower Holdings,
LLC, a Delaware Limited Liability Company, by and through its Attorney -
In -Fact, CCATT, LLC, a Delaware Limited Liability Company, for option and site Lease Agreement at 1331
South Ham Lane.
BACKGROUND INFORMATION: The original term of this lease was five years, commencing April 24, 1995
and ending April 30, 2000. The lease provided an option for five
extensions of five years each, of which four have been exercised by the
tenant. The fifth and final extension would have the lease term set to expire on April 30, 2025. The tenant has
requested an amendment to this lease that would extend the term by five additional five-year extensions. If all
extensions are exercised, the amended lease would expire on April 30, 2050, including the remaining
extension from the original lease. These extensions will be automatic unless the tenant notifies the City on
intent to not renew.
Additional changes to the lease as a part of this amendment include changes to rent escalations and a signing
bonus. The current lease provides for rent escalation every five years that is tied to the Consumer Price Index.
The City currently receives monthly rent in the amount of $1,100.94. The amendment would change the rent
escalations to an annual adjustment of three percent. There would also be a one-time rent increase on May 1,
2025 of 10 percent of the monthly rent in effect for the preceding month. The tenant has also agreed as a part
of this amendment to a one-time signing bonus to the City of $50,000, to be paid within 60 days of execution.
FISCAL IMPACT:
If all extensions are exercised the General Fund will receive approximately
$792,190 through 2050, in addition to the one-time, non-refundable $50,000
signing bonus.
FUNDING AVAILABLE: Not applicable.
01( Char s E. S imley, Jr.
Public Works Director
Prepared by Rebecca Areida-Yadav, Public Works Management Analyst
CES/RAY/tdb
Attachment
APPROVED:
Stephen Sc ''e%auer, City Manager
K:\WP\PROPERTY\MSC\CCATTAmendment1.doc 1/23/17
FIRST AMENDMENT TO
OPTION AND SITE LEASE AGREEMENT
THIS FIRST AMENDMENT TO OPTION AND SITE LEASE AGREEMENT (the
"First Amendment") is entered into this day of , 2016, by and between
CITY OF LODI, with a mailing address of P.O. Box 3006, Lodi, California 95241 ("Landlord")
and NCWPCS MPL 24 - YEAR SITES TOWER HOLDINGS LLC, a Delaware limited liability
company, by and through its attorney in fact, CCATT LLC, a Delaware limited liability
company, with a mailing address of 2000 Corporate Drive, Canonsburg, Pennsylvania 15317
(collectively referred to as "Tenant").
RECITALS
WHEREAS, Landlord and McCaw Communications of Stockton, Inc. ("Original
Tenant") entered into an Option and Site Lease Agreement dated March 3, 1995 ("Lease")
whereby Original Tenant leased certain real property, together with access and utility easements,
located in San Joaquin County, California from Landlord (the "Premises"), all located within
certain real property owned by Landlord (the "Property"); and
WHEREAS, NCWPCS MPL 24 - Year Sites Tower Holdings LLC is currently the tenant
under the Lease as successor in interest to Original Tenant; and
WHEREAS, the Premises may be used for the purpose of constructing, maintaining and
operating a communications facility, including tower structures, equipment shelters, cabinets,
meter boards, utilities, antennas, equipment, any related improvements and structures and uses
incidental thereto; and
WHEREAS, the Lease had an initial term that commenced on April 24, 1995 and expired
on April 30, 2000. The Lease provides for five (5) extensions of five (5) years each, the first
four (4) of which were exercised by Tenant. According to the Lease, the final extension expires
on April 30, 2025; and
WHEREAS, Landlord and Tenant desire to amend the Lease on the terms and conditions
contained herein.
1
Site Name: South Lodi
Business Unit #: 845961
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are acknowledged, Landlord and Tenant agree as follows:
1. Lease Term. Section 5 of the Lease is hereby deleted in its entirety and the
following is inserted in their place:
The term of this lease (this "Lease") shall be five (5) years, commencing on April
24, 1995 and expiring on April 30, 2000 (the "Initial Term"). Tenant shall have
the right to extend this Lease for ten (10) additional five (5) year terms, with the
final lease extension expiring on April 30, 2050 (each additional term is referred
to as a "Renewal Term"). Each Renewal Term shall be on the same terms and
conditions as set forth herein. This Lease shall automatically be renewed for each
successive Renewal Term unless Tenant shall notify Landlord of Tenant's
intention not to renew this Lease at least ten (10) days prior to the expiration of
the Initial Term or any Renewal Term. The Initial Term and any Renewal Term
shall be collectively referred to as the "Lease Term."
Landlord and Tenant hereby acknowledge that Tenant has exercised the first four (4)
Renewal Terms, leaving a balance of six (6) Renewal Terms.
2. Conditional Signing Bonus. Tenant will pay to Landlord a one-time amount of
Fifty Thousand and 00/100 Dollars ($50,000.00) for the full execution of this First Amendment
("Conditional Signing Bonus"). Tenant will pay to Landlord the Conditional Signing Bonus
within sixty (60) days of full execution of this First Amendment. In the event that this First
Amendment (and any applicable memorandum) is not fully executed by both Landlord and
Tenant for any reason, Tenant shall have no obligation to pay the Conditional Signing Bonus to
Landlord.
3. Regular Rent Escalation. On May 1, 2017, and on the anniversary of that date
every year thereafter (each an "Adjustment Date"), the monthly rent shall increase by an amount
equal to three percent (3%) of the monthly rent in effect for the month immediately preceding the
Adjustment Date ("Regular Rent Escalation"). This Regular Rent Escalation replaces and is in
lieu of the regular rent increase scheduled to occur pursuant to Section 7(c) of the Lease on or
after May 1, 2017.
4. One -Time Rent Increase. On May 1, 2025, the monthly Rent shall increase by an
amount equal to ten percent (10%) of the monthly Rent in effect for the immediately preceding
month ("One -Time Rent Increase") in addition to the Regular Rent Escalation that is scheduled
to occur pursuant to the Lease on the same date. The Regular Rent Escalation shall be applied
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Site Name: South Lodi
Business Unit #: 845961
first, and then the One -Time Rent Increase shall be applied after the rent is increased pursuant to
the Regular Rent Escalation.
5. Cellular Telephones. Section 7(d) of the Lease is hereby deleted in its entirety.
6. Right of First Refusal. Section 16 of the Lease is hereby deleted and the following
is inserted in its place:
If Landlord receives an offer from any person or entity that owns towers or other
wireless telecommunications facilities (or is in the business of acquiring
Landlord's interest in the Lease) to purchase fee title, an easement, a lease, a
license, or any other interest in the Premises, or Landlord's interest in the Lease,
or an option for any of the foregoing, Landlord shall provide written notice to
Tenant of said offer, and Tenant shall have a right of first refusal to acquire such
interest on the same terms and conditions in the offer, excluding any terms or
conditions that are: (a) not imposed in good faith; or (b) directly or indirectly
designed to defeat or undermine Tenant's possessory or economic interest in the
Premises. If Landlord's notice covers portions of the Property beyond the
Premises, Tenant may elect to acquire an interest in only the Premises, and the
consideration shall be pro -rated on an acreage basis. Landlord's notice shall
include the prospective buyer's name, the purchase price and/or other
consideration being offered, the other terms and conditions of the offer, the due
diligence period, the proposed closing date and, if a portion of Landlord's parent
parcel is to be sold, leased or otherwise conveyed, a description of said portion. If
the Landlord's notice shall provide for a due diligence period of less than sixty
(60) days, then the due diligence period shall be extended to be sixty (60) days
from exercise of the right of first refusal and closing shall occur no earlier than
fifteen (15) days thereafter. If Tenant does not exercise its right of first refusal by
written notice to Landlord given within thirty (30) days, Landlord may convey the
property as described in the Landlord's notice. If Tenant declines to exercise its
right of first refusal, then the Lease shall continue in full force and effect and
Tenant's right of first refusal shall survive any such conveyance. Tenant shall
have the right, upon Landlord's prior written consent, which consent shall not be
unreasonably withheld, conditioned or delayed, to assign the right of first refusal
to any person or entity, either separate from an assignment of the Lease or as part
of an assignment of the Lease. Notwithstanding the foregoing, Tenant shall have
the right, at its sole discretion, to assign the right of first refusal to an Affiliate as
defined below, either separate from an assignment of the Lease or as part of an
assignment of the Lease. Such assignment may occur either prior to or after
Tenant's receipt of Landlord's notice and the assignment shall be effective upon
written notice to Landlord. For purposes of this Lease, the term "Affiliate" shall
mean a person of business entity, corporate of otherwise, that directly or indirectly
through one or more intermediaries, controls or is controlled by, or is under
common control with Lessee. The term "control" means the right and power,
directly or indirectly, to direct or cause the direction of the management and
policies of a person or business entity, corporation or otherwise, through
ownership or voting securities, by contract or otherwise.
7. Condemnation. Section 14 of the Lease is hereby deleted and the following is
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Site Name: South Lodi
Business Unit #: 845961
inserted in its place:
In the event Landlord receives notice of a proposed taking by eminent domain of
any part of the Property upon which the Premises or any easements are situated,
Landlord will notify Tenant of the proposed taking within five (5) days of
receiving said notice and Tenant will have the option to: (i) declare this Lease null
and void and thereafter neither party will have any liability or obligation
hereunder; or (ii) remain in possession of that portion of the Premises that will not
be taken, in which event there shall be an equitable adjustment in rent on account
of the portion of the Premises so taken. With either option, Tenant shall have the
right to contest the taking and directly pursue an award. Tenant will be entitled to
reimbursement for any prepaid rent on a pro rata basis.
8. Government Approvals. If requested by Tenant, Landlord will execute, at
Tenant's sole cost and expense, all documents required by any governmental authority in
connection with any development of, or construction on, the Premises, including documents
necessary to petition the appropriate public bodies for certificates, permits, licenses and other
approvals deemed necessary by Tenant in Tenant's absolute discretion to utilize the Premises for
the purpose of constructing, maintaining and operating communications facilities, including
without limitation, tower structures, antenna support structures, cabinets, meter boards,
buildings, antennas, cables, equipment and uses incidental thereto. Landlord agrees to be named
applicant if requested by Tenant. Landlord shall be entitled to no further consideration with
respect to any of the foregoing matters.
9. Remainder of Lease Unaffected. The parties hereto acknowledge that except as
expressly modified hereby, the Lease remains unmodified and in full force and effect. In the
event of any conflict or inconsistency between the terms of this First Amendment and the Lease,
the terms of this First Amendment shall control. This First Amendment may be executed
simultaneously or in counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement. The terms, covenants and provisions of
this First Amendment shall extend to and be binding upon the respective executors,
administrators, heirs, successors, and assigns of the Landlord and Tenant.
[Execution Pages Follow]
4
Site Name: South Lodi
Business Unit 4: 845961
This First Amendment is executed by Landlord as of the date first written above.
LANDLORD:
CITY OF LODI
By:
Print Name:
Title:
[Tenant Execution Page Follows]
5
Site Name: South Lodi
Business Unit #: 845961
Approved as to form
r"Cli! Att ty
This First Amendment is executed by Tenant as of the date first written above.
6
Site Name: South Lodi
Business Unit #: 845961
TENANT:
NCWPCS MPL 24 — YEAR SITES TOWER
HOLDINGS LLC,
a Delaware limited liability company
By: CCATT LLC,
a Delaware limited liability company,
Its: Attorney in Fact
By:
Print Name:
Title:
WHEN RECORDED RETURN TO:
Prepared by:
Parker Legal Group, PC
600 West Broadway, Suite 700
San Diego, California 92101
Space above this line for Recorder's Use
A.P.N. 031-040-50 Prior recorded document(s) in San Joaquin County, California:
Recorded on May 19, 1995 at #95045372
MEMORANDUM OF FIRST AMENDMENT TO
OPTION AND SITE LEASE AGREEMENT
This Memorandum of First Amendment to Option and Site Lease Agreement is made
effective this day of , 2016 by and between CITY OF LODI, with a mailing
address of P.O. Box 3006, Lodi, California 95241 ("Landlord") and NCWPCS MPL 24 - YEAR
SITES TOWER HOLDINGS LLC, a Delaware limited liability company, by and through its
attorney in fact, CCATT LLC, a Delaware limited liability company, with a mailing address of
2000 Corporate Drive, Canonsburg, Pennsylvania 15317 (collectively referred to as "Tenant").
1. Landlord and McCaw Communications of Stockton, Inc. ("Original Tenant")
entered into an Option and Site Lease Agreement dated March 3, 1995 ("Lease"), a
memorandum of which was recorded on May 19, 1995 at Instrument No. 95045372, whereby
Original Tenant leased certain real property, together with access and utility easements, located
in San Joaquin County, California from Landlord (the "Premises"), all located within certain real
property owned by Landlord (the "Property"). The Property, of which the Premises is a part, is
more particularly described on Exhibit A attached hereto.
Site Name: South Lodi
Business Unit #: 845961
Documentary Transfer Tax $
Computed on full value of property
Computed on full value less liens and
encumbrances remaining at time of sale
Computed on full value of lease surpassing the 35
year term limit
Computed on leased area of the property
Signature of Declarant or agent — Firm Name
2. NCWPCS MPL 24 - Year Sites Tower Holdings LLC is currently the tenant
under the Lease as successor in interest to Original Tenant.
3. The Lease had an initial term that commenced on April 24, 1995 and expired on
April 30, 2000. The Lease provides for five (5) extensions of five (5) years each, the first four
(4) of which were exercised by Tenant (each extension is referred to as a "Renewal Term").
According to the Lease, the final Renewal Term expires April 30, 2025.
4. Landlord and Tenant have entered into a First Amendment to Option and Site
Lease Agreement (the "First Amendment"), of which this is a Memorandum, providing for five
(5) additional Renewal Terms of five (5) years each. Pursuant to the First Amendment, the final
Renewal Term expires on April 30, 2050.
5. By the First Amendment, Landlord granted to Tenant the right of first refusal to
purchase all or a portion of the Premises. Additional details of the foregoing right of first refusal
are set forth in the First Amendment.
6. If requested by Tenant, Landlord will execute, at Tenant's sole cost and expense,
all documents required by any governmental authority in connection with any development of, or
construction on, the Premises, including documents necessary to petition the appropriate public
bodies for certificates, permits, licenses and other approvals deemed necessary by Tenant in
Tenant's absolute discretion to utilize the Premises for the purpose of constructing, maintaining
and operating communications facilities, including without limitation, tower structures, antenna
support structures, cabinets, meter boards, buildings, antennas, cables, equipment and uses
incidental thereto. Landlord agrees to be named applicant if requested by Tenant. Landlord
shall be entitled to no further consideration with respect to any of the foregoing matters.
7. In the event of any inconsistency between this Memorandum and the First
Amendment, the First Amendment shall control.
8. The terms, covenants and provisions of the First Amendment shall extend to and
be binding upon the respective executors, administrators, heirs, successors and assigns of
Landlord and Tenant.
9. This Memorandum does not contain the social security number of any person.
10. A copy of the First Amendment is on file with Landlord and Tenant.
Site Name: South Lodi
Business Unit #: 845961
2
IN WITNESS WHEREOF, hereunto and to duplicates hereof, Landlord and Tenant
have caused this Memorandum to be duly executed on the day and year first written above.
LANDLORD:
CITY OF LODI
By:
Print Name:
Title:
[Acknowledgment Appears on Following Page]
3
Site Name: South Lodi
Business Unit 4: 845961
Approved as to form
City Attorney f� f
CALIFORNIA ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the truthfulness,
accuracy, or validity of that document.
STATE OF CALIFORNIA
COUNTY OF
On before me, , Notary
Public,
ss.
personally appeared , who
proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal
SIGNATURE OF NOTARY PUBLIC
Site Name: South Lodi
Business Unit #: 845961
[Tenant Execution Page Follows]
4
(Seal)
Site Name: South Lodi
Business Unit #: 845961
TENANT:
NCWPCS MPL 24 - YEAR SITES TOWER
HOLDINGS LLC,
a Delaware limited liability company
By: CCATT LLC,
a Delaware limited liability company
Its: Attorney In Fact
By:
Print Name:
Title:
[Acknowledgment Appears on Following Page]
5
State of Texas
County of
Before me, , a Notary Public, on this day personally appeared
of CCATT LLC, a
Delaware limited liability company, as Attorney in Fact for NCWPCS MPL 24 - YEAR SITES
TOWER HOLDINGS LLC, known to me (or proved to me on the oath of or
through driver's license, state id card, resident id card, military id card, or passport) to be the
person whose name is subscribed to the foregoing instrument and acknowledged to me that
she/he executed the same for the purposes and consideration therein expressed.
Given under my hand and seal of office this day of , 2016.
(Personalized Seal) Notary Public's Signature
Site Name: South Lodi
Business Unit #: 845961
6
EXHIBIT A
(Legal Description of the Property)
THE PROPERTY OF WHICH THE PREMISES ARE A PART IS DESCRIBED AS
FOLLOWS:
A PARCEL OF LAND LOCATED IN THE STATE OF CALIFORNIA, COUNTY OF SAN
JOAQUIN, WITH A SITUS ADDRESS OF 1331 S HAM LN, LODI, CA 95242-3904
CURRENTLY OWNED BY LODI CITY OF HAVING A TAX ASSESSOR NUMBER OF
031-040-50.
Site Name: South Lodi
Business Unit #: 845961
7
RESOLUTION NO. 2017-10
A RESOLUTION OF THE LODI CITY COUNCIL AUTHORIZING THE
CITY MANAGER TO EXECUTE AN AMENDMENT TO THE LEASE AGREEMENT
WITH NCWPCS MPL 24 — YEAR SITES TOWER HOLDINGS, LLC, A DELAWARE
LIMITED LIABILITY COMPANY, BY AND THROUGH ITS ATTORNEY-IN-FACT,
CCATT, LLC, A DELAWARE LIMITED LIABILITY COMPANY, FOR OPTION AND
SITE LEASE AGREEMENT AT 1331 SOUTH HAM LANE
WHEREAS, the original term of this lease was five years, commencing April 24, 1995,
and ending April 30, 2000; and
WHEREAS, the lease provided an option for five extensions of five years each, of which
four have been exercised by the tenant. The fifth and final extension would have the lease term
set to expire on April 30, 2025; and
WHEREAS, the tenant has requested an amendment to this lease that would extend the
term by five additional five-year extensions, extending the lease to April 30, 2050; and
WHEREAS, the current lease provides for rent escalation every five years that is tied to
the Consumer Price Index. The amendment would change the rent escalations to an annual
adjustment of three percent; and
WHEREAS, the Amendment includes a one-time rent increase on May 1, 2025 of
10 percent of the monthly rent in effect for the preceding month; and
WHEREAS, the tenant has agreed, as a part of this amendment, to pay a $50,000 one-
time signing bonus to the City of Lodi within 60 days of full execution of the Amendment; and
WHEREAS, staff recommends that the City Council authorize the City Manager to
execute an Amendment to the Lease Agreement with NCWPCS MPL 24 — Year Sites Tower
Holdings, LLC, a Delaware Limited Liability Company, by and through its Attorney -In -Fact,
CCATT, LLC, a Delaware Limited Liability Company, for option and site Lease Agreement at
1331 South Ham Lane.
NOW, THEREFORE, BE IT RESOLVED that the Lodi City Council does hereby
authorize the City Manager to execute an Amendment to the Lease Agreement with NCWPCS
MPL 24 — Year Sites Tower Holdings, LLC, a Delaware Limited Liability Company, by and
through its Attorney -In -Fact, CCATT, LLC, a Delaware Limited Liability Company, for option and
site Lease Agreement at 1331 South Ham Lane.
Dated: February 1, 2017
I hereby certify that Resolution No. 2017-10 was passed and adopted by the City
Council of the City of Lodi in a regular meeting held February 1, 2017 by the following vote:
AYES: COUNCIL MEMBERS — Chandler, Johnson, Mounce, and Mayor Kuehne
NOES: COUNCIL MEMBERS — None
ABSENT: COUNCIL MEMBERS — Nakanishi
ABSTAIN: COUNCIL MEMBERS — None
(J 1r+4ks
NIFER M. FERRAIOLO
City Clerk
2017-10