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EXHIBIT 10.5
RIGHT-OF-OCCUPANCY AGREEMENT
This Right of Occupancy Agreement, made as of the 10th day of June, 1998,
between NEW YORK STATE ELECTRIC & GAS CORPORATION, a corporation organized and
existing under the laws of the State of New York, having offices for the
transaction of business at 0000 Xxxxxx Xxxx Xxxx, Xxxxxxxxxx, Xxx Xxxx 00000
(hereinafter called "NYSEG") and TELERGY East, LLC, organized and existing under
the laws of the State of New York, having offices for the transaction of
business at Xxx Xxxxxxx Xxxxxxx, Xxxx Xxxxxxxx, Xxx Xxxx 00000 (hereinafter
called "TELERGY East").
In consideration of the sum of one dollar lawful money of the United
States of America by each in hand paid to the other, receipt of which is hereby
acknowledged, and of the mutual promises and covenants contained herein, TELERGY
East and NYSEG intending to be bound, agree as follows:
ARTICLE I
SCOPE OF AGREEMENT
Subject to the terms and conditions of this Agreement, NYSEG hereby grants
to TELERGY East for its own use, unless otherwise provided pursuant to the terms
of this Agreement, anon-exclusive Right-of-Occupancy, revocable only in
accordance with the terms and provisions of this Agreement, to install TELERGY
East's Backbone Network, Spurs and Facilities using NYSEG's Rights-of-Way,
poles, towers, abandoned gas and propane pipeline, Conduit and ducts
(hereinafter collectively "Right-of-Way"), which specific Right-of-Way shall be
defined by the parties as set forth in this Agreement; provided, however, NYSEG
shall apportion to TELERGY East only such real property rights that it currently
has or subsequently acquires and which it can lawfully apportion or, in the case
where NYSEG owns its rights-of-way in fee, such grants to TELERGY East as may be
legally permissible) to TELERGY East and the rights to be apportioned and/or
granted to TELERGY East are personal to TELERGY East and are not transferable or
re-apportionable by TELERGY East and shall not inure to the benefit of TELERGY
East's successors and assigns, except as provided in the LLC Operating Agreement
of even date or with the prior written consent of NYSEG (and, if necessary, the
consent of the Public Service Commission), it being the specific understanding
of the parties that the rights to be apportioned hereunder are being apportioned
and/or granted by NYSEG to TELERGY East in the nature of a quitclaim transfer
and that TELERGY East and not NYSEG shall bear the risk that Telergy East is
legally entitled to enter upon, occupy and use NYSEG Rights-of-Way, poles,
towers, Conduits, ducts and abandoned gas and propane air pipelines for the
purposes stated herein, and that TELERGY East specifically agrees to indemnify
NYSEG for all damages, costs, fees, penalties, including reasonable attorney
fees, and for any punitive or exemplary damages that might be imposed as a
result of the occupancy by TELERGY East of NYSEG Rights-of-Way, poles, towers,
Conduits, ducts and abandoned gas and propane air pipelines pursuant to this
Agreement; and further provided, that any new Right-of-Way, poles, towers,
Conduits, ducts or additional abandoned gas or propane air
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pipelines that NYSEG may in the future obtain, possess or control shall also
become subject to the terms of this Agreement.
ARTICLE II
DEFINITIONS
"Agreement" shall mean this Right-of-Occupancy Agreement entered into
herein between NYSEG and TELERGY East and as the same may be amended, modified
and supplemented from time to time. Words such as "herein," "hereafter,"
"hereof," "hereto," "hereby," and "hereunder" when used with reference to this
Agreement refer to this Agreement as a whole unless the context otherwise
requires.
"Approved Plans" shall mean plans which have been reviewed and approved by
NYSEG.
"Backbone Network" shall mean the initial path of the Fiber Optic Network
between Binghamton and Auburn, including cable of approximately 100 strands to
be installed overhead pursuant to this Agreement, which will connect to the
Ithaca and Binghamton and other Spurs,. primarily using NYSEG poles and towers.
"Bankruptcy" with respect to any principles of TELERGY East or NYSEG shall
mean the happening of any of the following:
A. The filing of an application for, or consent to, the appointment by a
Federal District Court of a Trustee over all or substantially all of its assets;
B. The filing of a voluntary petition in bankruptcy or the filing of a
pleading in any court of record admitting in writing its inability to pay its
debts as they become due;
C. The making of a general assignment for the benefit of creditors;
D. The filing of an answer admitting the material allegations of, or its
consenting to, or defaulting in answering, a bankruptcy petition filed against
it in any bankruptcy proceeding; or
E. The entry of an order, judgment, or decree by any court of competent
jurisdiction adjudicating TELERGY East or NYSEG or any Parent of either bankrupt
or appointing a Trustee over its assets, and such order, judgment, or decree
continuing unstayed and in effect for a period of sixty (60) consecutive days.
"Binghamton Spur" shall mean a Spur off the Backbone Network to be
constructed and installed in NYSEG Right-of-Way to a point at or near [***].
"Conduit" shall mean an individual pipe, tube or duct forming an enclosed
raceway for cable and/or conductors, also referred to as "duct," which may be
owned by NYSEG or installed by TELERGY East in NYSEG Right-of-way along its
electric or gas distribution or transmission systems and which may contain
multiple innerducts; provided, however, natural gas and/or propane air
pipelines, except abandoned gas or propane air lines, shall not be considered to
fall within the
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CONFIDENTIAL
[***] Confidential treatment has been requested with respect to material omitted
on this page. The omitted portions have been filed separately with the
Securities and Exchange Commission.
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definition of a Conduit and further provided, however, that Rights-of-Way along
the path of natural gas and propane air pipelines shall fall within the
definition of "Right-of-Way."
"Cornell Project" shall mean an ADSL resale application and any necessary
extension off the Backbone Network that may be required to be installed in NYSEG
Right-of-Way or Facilities in connection with Telergy's provisioning of ADSL
services.
"Easement" shall mean an easement in gross and/or the highest lesser real
property Right- of-Occupancy or use permitted to be apportioned or granted to
Telergy So Tier and which shall be consistent with the nature of NYSEG 's
interest in and to its Rights-of-Way.
"Electric Towers" shall mean metal and/or wood structures used for the
attachment of electrical transmission lines.
"Entry Notice" shall mean such notice as set forth in Paragraph 6.10.
"Facilities" when applied to property of or installed by or on behalf of
TELERGY East in, on, upon, under, across, along and through the
Right-of-Occupancy shall mean any transmission systems designed to carry
communications traffic and include Conduit installed by Telergy East,
innerducts, trace wire, carrier pipes, cables, fibers, junctions, regenerators,
power sources, fault alarm systems, electronics, structures or shelters, towers,
satellite earth stations and all other personal property necessary for or useful
to the construction, installation, operation, maintenance, repair,
reinstallation, replacement, relocation and removal of the Fiber Optic Network.
"Fiber Optic Network" shall mean the TELERGY East network, including the
Backbone Network and an spurs, loops or extensions thereto excluding the Cornell
Project, whether heretofore or hereafter conceived, invented or developed, which
primarily utilizes optical fiber as the medium for transmitting voice
communications and/or other information or data and which is located within
NYSEG's Right-of-Way utilized under this Agreement, excluding the Cornell
Project.
"Fiber Optic Ground Wire" or F.O.G. wire shall mean static wire containing
optical fibers.
"Initial Term" shall mean the initial twenty-five (25) year period of this
Agreement.
"Ithaca Spur" shall mean an extension off the Backbone Network to be
constructed and installed in NYSEG Right-of-Way connecting to Cornell and
extending on to connect two points at or near Xxxx Atlantic POPS.
"TELERGY East" shall mean the limited liability company, which is a party
to this Agreement and is granted permission by NYSEG in accordance with the
terms and conditions of this Agreement to place its Fiber Optic Network and
Facilities using NYSEG 's Right-of-Way and which is responsible for compliance
with NYSEG 's regulations and/or standards as well as all legal and other
regulatory or governmental rules, regulations and orders in performing
activities contemplated by this Agreement.
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"Make-Ready Work" shall mean all work including but not limited to the
rearrangement of existing facilities, rodding of duct, and similar installation
required to accommodate the installation of TELERGY East's Backbone Network and
spurs, loops or extensions thereto, including the Cornell Project, in accordance
with this Agreement.
"NYSEG " shall mean New York State Electric and Gas Corporation, which is
a party to this Agreement.
"NYSEG Capacity" shall mean the dark fiber strands set forth below in
Article 5.1, which dark fiber shall be provided to by TELERGY East in
consideration for the Right-of-Occupancy conferred by this Agreement.
"NYSEG Standards" shall mean all rules, regulations and procedures that
shall govern Telergy East's activities under this Agreement, which standards
shall be attached hereto as Exhibit "A".
"NYSEG System" shall mean NYSEG's Right-of-Way and electric, natural gas
and propane air transmission and distribution systems.
"Pre-Construction Survey" shall mean the work operations to be performed
in order to process an application for a Right-of-Occupancy to the point just
prior to performing any necessary Make-Ready Work. There are three elements of
Pre-Construction Survey:
A. engineering (planning) record search to determine span capacity of
conduit or gas system,
B. field inspection of the existing facilities to verify available space
and determine Make-Ready Work order, and
C. administrative effort required to process the application and prepare
Make-Ready Work order.
"Property Drawings" shall mean the NYSEG Right-of-Way drawings, plan and
profile drawings for the use of Right-of-Way within which TELERGY East has been
granted a Right-of-Occupancy, in accordance with the terms and conditions of
this Agreement.
"Regenerator" shall mean a facility which receives, regenerates, and
retransmits a digital telecommunications transmission signal, together with
attendant equipment and structures, including power sources.
"Right of Occupancy" shall mean Telergy East's right to place its Fiber
Optic Network and Facilities for the Backbone Network and any spurs, loops or
extensions thereto including the Cornell Project in NYSEG's Right-of-Way as
defined below in accordance with and as defined by the terms and conditions of
this Agreement. A Right-of-Occupancy under this Agreement shall not provide
TELERGY East with any ownership interest in NYSEG 's real property or
Right-of-Way.
"Right-of-Way" shall mean the area of NYSEG-owned, -operated, or
-controlled property for an electric or gas distribution or transmission line,
Conduit, pole, tower, or facilities, abandoned
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gas and propane pipeline and other NYSEG gas or electric as well as access to
Rights-of-Way or easements along the path of any NYSEG natural gas or propane
air pipeline as well as access to Rights-of-Way that may be acquired by NYSEG
within and outside of New York State subsequent to the date of this Agreement.
"Spur" shall mean any extension off the Backbone Network, and shall
include laterals, loops and spurs constructed or installed in NYSEG's
Right-of-Way, excluding the Cornell Project.
"System" shall mean Telergy East's Fiber Optic Network, as is heretofore
or hereafter conceived, invented or developed by TELERGY East, and which
primarily utilizes optical fiber as the means for transmitting voice, data or
video and/or other information pursuant to this Right-of-Occupancy Agreement.
"Term" shall mean the Initial Term and any extensions thereof.
"Tower Sites" shall mean those areas on the Right-of-Way on which towers
or earth satellites are located.
"Working Day" shall mean any day other than a Saturday, a Sunday or a
Federal or New York State holiday.
ARTICLE III
RIGHT-OF-OCCUPANCY DESIGNATION
3.1 For an initial term of twenty-five (25) years, NYSEG hereby grants to
TELERGY So-Tier Right-of-Occupancy in, on, upon, under, across, along and
through (hereinafter collectively referred "within") its Right-of-Way, the
precise locations and path of which will be determined as set forth herein, for
the construction, installation, operation, maintenance, repair, replacement,
relocation, reinstallation and removal therein, thereon, thereover, thereunder
or therefrom of a Fiber Optic Network, including the installation of the
Backbone Network, Spurs and the Cornell Project as well as related equipment or
Facilities, in accordance with the terms and conditions of this Agreement. NYSEG
hereby grants TELERGY East, its successors and assigns, the right and option to
extend the Initial Term of this Agreement in its entirety or with respect to all
or any portion of the system, from the date upon which it would otherwise expire
for up to two (2) consecutive Extension Periods of ten (10) years each.
Nothing in this Agreement permits the installation of more than one
System, except when making necessary repairs, including cable replacement. The
aforesaid grants shall constitute Rights-of-Occupancy burdening the Right-of-Way
to the extent set forth in this Agreement. Nothing herein shall be construed as
to obligate NYSEG in any way to acquire any Rights-of-Way or other interests for
TELERGY East, provided, however, that NYSEG agrees to provide Telergy East with
access to any available Rights-of-Way that NYSEG may subsequently acquire in
accordance with the terms and conditions of this Agreement.
Although TELERGY East shall be entitled to additional Right-of-Occupancy,
in accordance with the terms and conditions of this Agreement for its Spurs
supplementing the Backbone Network
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and the Cornell Project as desired by TELERGY East for the design, engineering,
construction, installation, operations, maintenance, repair, replacement,
relocation reinstallation and removal therein, thereon, thereover, thereunder or
therefrom of Spur, including the installation of fiber optic cable and related
equipment for any Spurs, the precise path of the Spurs shall be mutually decided
by the parties.
TELERGY East shall have the right, in accordance with the terms and
conditions of this Agreement, either upon the original installation or
subsequently where necessary, to install multiple fiber optic cables within
Right-of-Way contemplated herein along the Backbone Network, Spurs or portions
thereof and the Cornell Project to accommodate additional capacity requirements,
provided that available space exists for such multiple fiber optic cables.
Where TELERGY East desires to construct the Fiber Optic Network in areas
where NYSEG does not possess a fee simple interest in the property which contain
its electric towers, NYSEG in such cases, hereby apportions such rights as it
has to Telergy East, in accordance with the terms and conditions of this
Agreement: (i) to construct the System and the Cornell Project in the NYSEG
Right-of-Way and (ii) to negotiate with the fee simple owners. The parties
understand that TELERGY East is not obligated to construct any particular area
and may decide to use non-NYSEG Rights-of-Way or facilities in certain
locations. TELERGY East desires, but is not obligated to construct all or any
portion of the System within any Right-of-Way along the NYSEG Right-of-Occupancy
contemplated by this Agreement.
The Right-of-Occupancy granted herein shall be non-exclusive, and shall be
subordinated to all existing easements, rights, privileges, licenses, or grants
or whatever nature heretofore given by NYSEG, which now exist and which affect
the property NYSEG, including but not limited to drainage rights, streets,
roadways, telephone lines, underground conduits, sewers, manholes, pipes or
right-of-way. Provided further, and notwithstanding the other provisions of this
Agreement, the parties recognize that NYSEG has the legal obligation to provide
non-discriminatory access to all telecommunications providers and, as such,
TELERGY East's Right-of-Occupancy to NYSEG Rights-of-Way, poles, towers,
conduits, ducts and abandoned gas and propane air pipelines shall not be
exclusive, however NYSEG shall not grant any third party rights to utilize
Rights-of-Way that interferes with Telergy East's rights hereunder. If other
telecommunications providers request access to NYSEG's Rights-of Way, for a
particular NYSEG route for which TELERGY East has not already requested such
access and agreed to pay the fees as set forth in Paragraph 5.1, then NYSEG
reserves the right to grant any such other telecommunications provider to
NYSEG's facilities, even if in granting such access, NYSEG would no longer have
any space available on that particular route to permit further or additional
telecommunication construction on that particular route. Further installation of
Facilities shall be permitted only insofar as such installations meet with all
legal, regulatory or governmental requirements and NYSEG Standards.
3.2 NYSEG shall provide at its own expense one set of all reasonably
requested copies of its Property Drawings with available indices for the
designated path of the Backbone Network, any Spurs or the Cornell Project.
Furnishing such drawings or materials however shall not be a guarantee of the
accuracy or completeness by NYSEG, and TELERGY East agrees to hold NYSEG
harmless from any claims by Telergy East or its agents arising from the
inaccuracy or completeness of such drawings or materials.
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3.3 NYSEG shall permit TELERGY East's employees, agents and contractors to
enter Right-of-Way for the Backbone Network, any Spurs, and the Cornell Project
on reasonable prior notice, which notice shall not be required to given more
than three (3) business days for the purpose of surveying and inspecting the
same and to make such engineering and other tests as may be necessary or
advisable to enable TELERGY East to prepare plans for the location of Backbone
Network, Spur, or the Cornell Project within any Right-of-Way and to determine
the engineering and cost consideration with respect to construction of the
System therein.
NYSEG shall also provide TELERGY East reasonable access to available title
documentation within NYSEG 's possession with respect to the Backbone Route and
any Spurs, including easements or occupancy rights, if any, heretofore granted
within any portion of such Right-of-Way, including any third-party rights, and
other existing agreements with respect to the Right-of-Way and/or restrictions
on NYSEG's right to use and occupy the same for the purposes intended by this
Agreement, including without limitation, utility crossings.
NYSEG shall further provide TELERGY East reasonable access to maps and
other documentation within NYSEG's possession as may be sufficient to describe
the identity and location of other users of the portions of the Backbone
Network, any Spurs, or the Cornell Project, which TELERGY East may have under
consideration for the installation or replacement of the System. If known to
NYSEG, it shall notify TELERGY East of any outstanding adverse claims that have
been or are made affecting any Rights-of-Way for which a Right-of-Occupancy has
or may be granted and in which TELERGY East has identified for its use under
this Agreement.
3.4 Within ten (10) days of the date of this Agreement, NYSEG will provide
to TELERGY East standard written engineering guidelines for construction plans
and standard guidelines for determining position and location of TELERGY East `s
Facilities. Any material deviations from such standard guidelines shall be
subject to the written approval of NYSEG .
3.5 The parties intend that to the extent it is reasonable and in
accordance with applicable legal requirements, where TELERGY East installs fiber
optic cable underground, it will place the cable near the perimeter of the
Right-of-Way and the parties agree to work closely and reasonably to select a
preferred route for the Right-of-Occupancy within any Right-of-Way.
3.6 NYSEG agrees to participate with TELERGY East in a joint review of the
preliminary route designation plans for the Right-of-Occupancy and in making
reasonably necessary physical inspections of a Right-of-Way for the purpose of
identifying problem areas, arriving at suitable alternatives, and defining final
routes. Based upon such preliminary plans, physical inspections and other
engineering data available to TELERGY East, it shall prepare and submit to NYSEG
one (1) set of construction plans ("Working Drawings") for the System, which may
be submitted either for the entire System or for designated Spurs. Working
Drawings shall be submitted by TELERGY East to NYSEG 's Engineering Department
not less than ten (10) days prior to TELERGY East's anticipated initiation of
construction.
Following each submission of such Working Drawings, NYSEG shall approve
the same in whole or in part or raise any bona fide objections thereto in whole
or in part which shall be stated in
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writing and shall include reasonable detail of any necessary modifications
provided however, that NYSEG's approval shall be in accordance with the
provisions of Article I and Paragraph 3.1. For purposes of this Agreement, a
"bona fide objection" shall include any condition that will cause the
unreasonable interference with NYSEG 's operations, pose an unreasonable hazard
to NYSEG 's personnel, properties or facilities, or unreasonably limit the use
of the Right-of-Way by NYSEG for power or gas transmission or distribution
purposes. NYSEG agrees to review Working Drawings and to approve or raise bona
fide objections thereto as soon as reasonably practical, but in no event later
than five (5) days following receipt of each submission in NYSEG 's Engineering
Department. Upon receipt of any such objections, TELERGY East shall either: (i)
correct the Working Drawings in respect of which such objections were noted by
making appropriate changes thereto, or (ii) advise NYSEG of any technical
problems that may impede TELERGY East's ability to make the changes, and, in
either event, shall resubmit them to NYSEG.
Notwithstanding anything herein to the contrary, due to the accelerated
construction requirements of the installation of the Backbone Network, the
parties agree to exercise their best efforts consistent with NYSEG 's public
service responsibilities to assure all Working Drawings for the Backbone Network
are reviewed and approved by NYSEG no later than [***], and to ensure that
Working Drawings for the Cornell Project are reviewed and approved by NYSEG no
later than [***].
Procedures and schedules for any necessary F.O.G. Wire installations on
the Backbone Route will be developed jointly by NYSEG and TELERGY East, and each
will exercise their best efforts to assure that all F.O.G. Wire installation(s)
are completed as soon as practical.
In addition to the Right-of-Occupancy apportioned or granted by NYSEG as
described in this Articles I and III, NYSEG shall apportion or grant to TELERGY
East, in accordance with the terms of this Agreement, Rights-of-Occupancy at
each Regenerator or Junction, at locations along the path of the Backbone
Network, any Spurs or the Cornell Project, the precise location of which shall
be mutually approved, for the installation, maintenance, operation, repair,
replacement and removal, at TELERGY East's sole cost and expense, of utilities
required to service the System including auxiliary and primary power sources and
water and sewer lines, for the use of TELERGY East. In furtherance of the
foregoing, and when required by the utility company or municipality providing
such services, NYSEG shall grant appropriate access and/or Right-of-Occupancy
within the Right-of-Way, to the extent NYSEG's Right-of-Way Agreements permit
the apportionment or grant of such access, to such utility company and/or
municipality. Power sources installed by TELERGY East shall meet all applicable
National Electrical Codes, and NYSEG regulatory and local-ordinance
requirements.
ARTICLE IV
SITES FOR NON-CABLE FACILITIES
4.1 As requested by TELERGY East, NYSEG, where franchised, reasonable and
in accordance with any applicable NYSEG Agreements, shall provide TELERGY East
at the Regenerator Sites, metered electric service in accordance with all
applicable tariffs (including any duty that TELERGY East may have to pay the
cost of any such Facilities that exceeds the cost of
CONFIDENTIAL
[***] Confidential treatment has been requested with respect to material omitted
on this page. The omitted portions have been filed separately with the
Securities and Exchange Commission.
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what NYSEG may be required to provide pursuant to its tariff free of charge),
the cost of which shall be paid by TELERGY East.
4.2 TELERGY East shall be entitled, in accordance with the terms and
conditions of this Agreement, to install its Regenerator Facilities for its
System or the Cornell Project, along Rights-of-Way; provided, however that no
Regenerator facility shall be located on any portion of such Rights-of-Way or
other NYSEG property identified by NYSEG as unavailable due to a planned NYSEG
use at such location. The location of such Regenerator Facilities shall be
subject to NYSEG 's approval. Wherever possible, NYSEG agrees to use its best
efforts to provide TELERGY East vacant land (a maximum of [***] feet by [***]
feet in size) at or near power plants or substations identified by TELERGY East
along the Backbone Network or any Spurs for use or such Regenerator Facilities,
but only to the extent NYSEG has the right to apportion or grant such access
and, provided further, any costs associated with the use of such vacant land
shall be borne by TELERGY East.
ARTICLE V
NYSEG DARK FIBERS
5.1 In consideration of the granting of the Right-of-Occupancy within the
Backbone Network Rights-of-Way, TELERGY East shall pay an annual fee of
approximately $338 per pole for attachment for the initial construction of the
Backbone Network which is approximately 92 miles from Binghamton to Syracuse.
For Spurs, including the Binghamton and Ithaca Spurs, to be constructed or
installed in the future, where TELERGY East uses NYSEG Right-of-Way, Conduit,
ducts, abandoned gas or propane air pipelines (other than for the initial
Binghamton to Syracuse run) for the purpose of installing Facilities as set
forth in this Agreement, TELERGY East shall provide NYSEG with six (6) dark
fiber strands along the entire length of any such Spur, excluding the Cornell
Project, when such Spur is constructed or installed by TELERGY East on NYSEG's
Rights-of-Way or in NYSEG owned or controlled ducts, Conduits or in abandoned
gas or propane air pipelines and NYSEG the dark fiber shall be accepted as
payment in kind, provided however that NYSEG shall not receive strands within
the service entrance pipes used to access buildings by Telergy East . NYSEG
shall have an irrevocable right to use ("IRU") such dark fibers and NYSEG shall
have the right to utilize those fibers to satisfy its own internal
communications needs, or may lease or transfer the dark fiber to parties
(including those that compete with TELERGY East), or NYSEG"s Affiliates, and/or
make any other lawful and proper use of the dark fiber as NYSEG may desire
provided however that in the event NYSEG uses any portion of the dark fiber or
its IRU for purposes other than its internal communications needs, NYSEG or the
third-party transferee shall be required to pay maintenance fees and other
standard charges as are then in effect at the time of such use.
5.2 If TELERGY East shall utilize any of NYSEG 's distribution poles for
the installation of any portion of TELERGY East's Fiber Optic Network, TELERGY
East shall enter into the appropriate Pole Attachment Agreement and shall pay
NYSEG 's then prevailing pole attachment charge, as filed by NYSEG with the
Public Service Commission of the State of New York and NYSEG shall not be
entitled to any dark fibers along any particular portion of the Backbone Network
or any Spurs where TELERGY East pays NYSEG's standard pole attachment fees.
CONFIDENTIAL
[***] Confidential treatment has been requested with respect to material
omitted on this page. The omitted portions have been filed separately
with the Securities and Exchange Commission.
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5.3 At its own expense, TELERGY East shall have the right to replace and
upgrade the System due to changes in technology as long as NYSEG's use of its
dark fiber is not adversely affected, and so long as there is space available.
5.4 In the event NYSEG terminates Telergy East's use of any portion of any
Right-of-Way due to a taking, condemnation or public utility requirement,
Telergy East's obligation to provide dark fiber along the affected portion shall
terminate without further liability or payment to NYSEG.
ARTICLE VI
CONSTRUCTION SCHEDULE, NOTICE, STANDARDS AND PERMITS
6.1 TELERGY East shall furnish to NYSEG a proposed schedule of
commencement and completion dates for construction of the Backbone Network
within ten (10) days of the date of this Agreement. Said schedule shall not be
binding on the parties but shall be an indication of proposed construction and
installation.
6.2 TELERGY East shall secure, at its expense, all necessary and final and
unconditional approvals, permits and licenses (collectively referred to as
"Approvals") from all governmental authorities and/or other parties having
jurisdiction or approval rights in respect of the use and occupation of the
Right-of-Way and the installation, operation and maintenance of the System
within the Right-of-Occupancy, specifically including, without limitation, all
required regulatory environmental approvals. If required by any local law, NYSEG
agrees, upon request to cause its authorized officers or representatives to
execute any applications or other documentation prerequisite to securing the
Approvals. Environmental impact assessments or statements required, if any,
shall be prepared by TELERGY East at its sole risk, cost and expense.
6.3 Following the issuance of any necessary Approvals, TELERGY East, its
employees, agents, contractors and/or subcontractors shall, in accordance with
the terms and conditions of this Agreement, have the right to construct the
System within any Rights-of-Way and shall obtain a Right-of-Occupancy in
accordance with the Working Drawings.
6.4 All access to areas in and around utility tower and pole areas, as
well as power plants and substations shall be coordinated by NYSEG in accordance
with TELERGY East's anticipated construction schedule.
6.5 Except as herein otherwise expressly set forth, construction and
installation of the Backbone Network, Spurs and the Cornell Project and the
furnishing of all labor, materials and equipment necessary to construct and
install the same, shall be at TELERGY East's sole expense. All such work shall
be performed in a good and workmanlike manner and in compliance with all laws,
ordinances, codes and regulations of any governmental authorities having
jurisdiction thereover, subject, nevertheless, to TELERGY East's right in good
faith and at its expense to
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contest any such laws, ordinances, codes or regulations and NYSEG's Standards or
the application thereof to the System or TELERGY East's installation thereof;
and, if required by law, NYSEG , at its discretion, may permit any such contest
to be conducted in its name.
6.6 TELERGY East shall be responsible for obtaining from private entities
and/or public agencies any and all necessary easements, rights of way, licenses,
permits, permissions, certifications or franchises to construct, operate and/or
maintain its Fiber Optic Network or the Cornell Project or portions thereof on
private or public property at the location of TELERGY East's Facilities. NYSEG
agrees that it shall provide reasonable cooperation in connection with TELERGY
East's efforts to obtain such necessary permits and consents.
6.7 If NYSEG 's permission or consent in writing is required by a
governmental or regulatory agency in conjunction with the processing or
application by TELERGY East for such permits and consents, NYSEG shall provide
same, provided, however, that NYSEG shall have the right to review and approve
the terms and conditions, if any, that may be required or requested of NYSEG by
said governmental or regulatory agency, which such approval shall not be
unreasonably withheld.
6.8 In conformance with the other terms and provisions of this Agreement,
NYSEG does not warrant the validity or apportionability of any rights it may
hold for TELERGY East to place its Facilities on private property. NYSEG will,
upon written request by TELERGY East, provide available information and copies
of any documents in its files pertinent to the nature of the rights NYSEG
possesses over private property. The cost of providing such information and
reproducing documents shall be borne by TELERGY East.
6.9 Where TELERGY East determines that NYSEG has an Easement over a public
or private right of way sufficiently broad under New York State law to permit
TELERGY East's Right-of-Occupancy, it shall, in its sole discretion, make the
determination whether to obtain an independent Easement from the property owner
to place its Facilities. NYSEG shall have no duty to advise TELERGY East
concerning its perceptions or beliefs concerning the issue whether TELERGY East
has a lawful right of access to its poles, Rights-of-Way, ducts, Conduits and
abandoned gas and propane air pipelines except that NYSEG shall be required to
inform Telergy East of any known challenges to NYSEG's use or occupancy of any
Right-of-Way, and shall further use its best efforts to advise Telergy East of
any persons or entities with whom NYSEG has had or is aware of disputes
involving real property interests of entering on property; otherwise it shall be
TELERGY East's sole duty and responsibility to review NYSEG records to make such
determinations.
6.10 Except for maintenance, emergency situations or situations requiring
expeditious action, whenever TELERGY East desires to use NYSEG's Right-of-Way to
construct, install, repair, reinstall, replace, relocate or remove any part or
portion of the System or its Facilities, TELERGY East shall submit written
notice ("Entry Notice") three business days in advance to NYSEG . If, other than
in an emergency, the proposed work shall require TELERGY East to disturb NYSEG
's operations, such Entry Notice shall include, as applicable, plans, including
reasonable details and methods of the proposed construction, repair, replacement
or other work. Such plans and the timing of all such work shall be subject to
the consent and approval of NYSEG
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as provided in Paragraph 3.6. Prior to commencement of any cable installation,
TELERGY East shall provide required notification to the respective local
Underground Utilities Locating Service as is appropriate for that area.
For and during the term of the Agreement, NYSEG shall not excavate for the
purposes of longitudinal construction and/or insertion of cable or conduit
within five (5) feet of the Running Line of the System other than for necessary
gas and/or electric distribution or transmission purposes. Except for NYSEG
System emergencies, all excavations within ten (10) feet of the Running Line of
the System shall require not less than thirty (30) days prior written notice to
TELERGY East and shall be coordinated with TELERGY East so as to prevent damage
to the System and the disruption of transmission thereover. Moreover, NYSEG
shall use its best efforts to minimize any disruptions of the System during the
performance of any work by NYSEG or others within the restricted area.
6.11 TELERGY East, at its sole risk, cost and expense, shall furnish all
materials, construct, maintain, use, change or remove TELERGY East Facilities or
any part thereof in accordance with the design and specifications on Working
Drawings, in a prudent and workmanlike manner, in conformity with any applicable
statutes, rules, orders, regulations and specifications of any public body
having jurisdiction thereof and in conformity with NYSEG 's Standards and so as
not to interfere with or endanger any property, operations, maintenance, or
employees of NYSEG , or of other existing parties lawfully occupying or using
the property of NYSEG .
6.12 Except as otherwise provided herein, TELERGY East shall be
responsible for any and all costs associated with the design, engineering,
construction, installation and subsequent maintenance and operations of the
System.
6.13 TELERGY East , upon not less than three (3) working days prior notice
to NYSEG, may during any period of construction and installation of the Backbone
Network, any Spurs or the Cornell Project, following completion of construction
thereof, in connection with post-construction cleanup activities, place
inspectors, supervisors, or other reasonably necessary personnel on site for the
protection of Telergy East's operation, property, Right-of-Way, or the property
of others.
In the event that TELERGY East shall require the use of NYSEG personnel at
other than normal business hours, it shall reimburse NYSEG for payment by to
NYSEG for any "shift differentials" for any such personnel or the excess of
overtime pay for any such personnel over their normal compensation provided that
Telergy East agrees in advance to such additional costs. In addition, TELERGY
East shall pay for all pre-approved personnel to oversee the repair of damage to
NYSEG 's facilities due to TELERGY East's or its subcontractors' negligence
except work performed by NYSEG during construction.
6.14 Following the completion of the initial construction of the Backbone
Network, the operation, maintenance, repair, replacement, reinstallation,
relocation and/or removal thereof shall be solely under the control and at the
expense of TELERGY East, subject nevertheless to the provisions regarding Entry
Notices as set forth above.
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6.15 The parties recognize that high voltage transmission wires may come
into play with the construction and maintenance of some of TELERGY East's
System. There are certain types of work that only "qualified electrical
contractors" can perform (e.g., work within ten (10) feet of high tension wires)
Provided further, in the event maintenance or construction of TELERGY East's
Facilities requires NYSEG to deactivate pipes or lines, TELERGY East shall be
responsible to pay NYSEG all costs associated therewith, including any lost
revenues that NYSEG incurs as a result of such deactivation provided however
that the parties shall meet and agree to the amount of any such lost revenues in
advance..
ARTICLE VII
RELOCATIONS, SURVEY RECORDS, FACILITY LOCATION SIGNS
7.1 In the event that a portion of NYSEG 's Right-of-Way occupied by
TELERGY East is reasonably required (and not merely for NYSEG's convenience) by
NYSEG or is required by regulatory or legal reasons in connection with NYSEG 's
gas and/or electric business, NYSEG will exercise a best effort approach for the
continued use of the Right-of-Occupancy of the Right-of-Way or alternate
Right-of-Way by TELERGY East subject however to the other terms and conditions
of this Agreement. However, where this is not appropriate, NYSEG will, subject
to the terms and conditions of this Agreement, where feasible, with F.O.G. Wire
supplied by TELERGY East, pull in, attach and make ready for TELERGY East
connection, the F.O.G. Wire on the rebuilt/relocated sections of the
Right-of-Way, and NYSEG shall be paid an appropriate fee for such services.
TELERGY East, at its sole cost, assumes all responsibility for all
installations, training, materials, splices and bypass necessary to relocate
and/or reconnect the relocated portion of the System to the balance of the
System and NYSEG shall not incur any cost and TELERGY East shall bear the entire
cost associated with such required relocation or removal of Facilities by
TELERGY East where such relocation and/or removal is reasonably required by
NYSEG (and not merely for NYSEG's convenience) or is required by regulatory or
legal reasons to be used in connection with NYSEG's gas and/or electric
business. Additionally, TELERGY East agrees that such F.O.G. Wire shall meet
NYSEG 's electrical and structural design requirements. In the event of such
relocation, if the continued use of the Right-of-Way by TELERGY East is not
appropriate, and if a F.O.G. Wire installation is not feasible and removal of
all or a portion of TELERGY East's System from NYSEG's right-of-way is required,
all responsibility for provision of the NYSEG dark fiber related to the portion
affected by such removal may be terminated by Telergy East without further
obligation to NYSEG..
7.2 NYSEG shall make available survey records in its possession for
inspection and/or reproduction by TELERGY East at TELERGY East's costs, subject
to limitations of survey contracts, regulations or local laws. NYSEG however
shall not be deemed to have guaranteed the accuracy of such standards.
7.3 TELERGY East's, at its sole cost and expense, shall furnish, erect and
thereafter maintain cable markers designating all TELERGY East underground
Facilities. Such markers shall
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be installed at the edge of the Right-of-Way or some other location reasonably
designated by NYSEG along centerline. The cable markers shall be placed in
conformity with industry standards or as otherwise approved by NYSEG.
If NYSEG is required by any municipal or public authority to relocate its
Conduit System which contains TELERGY East Facilities and TELERGY East desires
to relocate rather than use other Rights-of-Way, including those of third
parties, TELERGY East shall pay its proportionate share of the total relocation
costs. The cost shall include all relocation costs and tie up costs reasonably
incurred under the circumstances at the usual rates recoverable by NYSEG in
relocation projects.
7.4 Should any portion of the Backbone Network, any Spurs or the Cornell
Project installed by TELERGY East in NYSEG Right-of-Way be appropriated and/or
acquired by condemnation or the power of eminent domain by any public or
quasi-public authority, then the Rights-of-Occupancy hereby granted to the
extent appropriated shall terminate, and NYSEG shall use its best efforts to
make other Right-of-Way available to TELERGY East and, in any event, this
Agreement shall otherwise remain in full force and effect.
7.5 If any taking includes any portion of the System, TELERGY East's
Facilities, or the Cornell Project, TELERGY East's interest in the System shall
be severed from NYSEG's interest in such proceeding and the parties agree to
have the condemnation awards specifically allocated between and payable in
accordance with TELERGY East's interest, both physical and occupational,
including any incremental value of an affected Right-of-Way by virtue of the
installation of the System that is awarded, and NYSEG's interest, both physical
and ownership rights. In addition, if permitted pursuant to applicable law,
TELERGY East shall be entitled to make a claim for and receive the portion of
the award attributable to either the entire amount if separately allocated or
the proportionate share if combined in a lump sum award, the System and/or
damages payable on account of System relocation expenses.
To the extent it has knowledge, NYSEG shall notify TELERGY East
immediately of any condemnation threatened or filed against any portion of the
Backbone Network which includes TELERGY East's preliminary Network designation
plan or could include any part of the System within a Right-of-Occupancy, and
NYSEG further agrees not to sell or convey any portion of a Right-of-Occupancy
on a Right-of-Way containing any Facilities to such acquiring authority in lieu
of condemnation without prior notice to and approval by TELERGY East. Upon
giving any such notice to TELERGY East, NYSEG shall, to the extent available to
it, offer TELERGY East, without payment of any additional consideration therefor
by TELERGY East, alternate contiguous areas within the Right-of-Way within which
the Right-of-Occupancy may be relocated following such taking.
ARTICLE VIII
CABLE INSTALLATION AND CONSTRUCTION
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8.1 Except for the initial Backbone Network which shall be installed
primarily using above ground poles and towers, in all situations where possible
and practical, cable shall normally be installed by TELERGY East underground,
and in accordance with Working Drawings approved by NYSEG and with the
construction standards as provided herein. Cables crossing under public roadways
shall be at a location and depth as determined by state and local conditions,
laws, regulations or orders of public authorities and NYSEG Standards and
requirements. To the extent not preempted by state of local laws, regulations or
orders, such installation shall also be in accordance with the approved Working
Drawings and the construction standards as provided herein. Cables crossing over
or under other existing public utilities shall be located and installed in
accordance with local conditions, laws, regulations or orders of public
authorities, NYSEG Standards and requirements and such requirements as may be
required by the New York State Public Service Commission. If in the conduct of
work, any changes or alterations, permanent or temporary, in existing pipelines,
sewers, drains, conduits, fences, power, signal or communication lines or other
utilities are necessary, such changes shall be made or caused to be made solely
by TELERGY East and at TELERGY East's sole risk, cost and expense. Emergency
cable installation, maintenance and repair methods shall comply with standards
and policies to be developed by the parties; provided, however, in no event
shall a TELERGY East emergency situation allow TELERGY East to damage other
third party or NYSEG facilities such that such NYSEG or third party facilities
would be required to be taken out of service.
8.2 The rights of parties to whom NYSEG currently, or to whom NYSEG may in
the future lease, license, or apportion any of the lands on which the Fiber
Optic Network, System or Cornell Project will be installed shall be protected
and TELERGY East, its contractors, agents and employees shall assume all
responsibility for any damage actually done by TELERGY East, its contractors,
agents and employees to lawns, gardens, shrubbery, fences, etc, and upon
completing construction, TELERGY East shall restore the lands to substantially
the same condition as before entering thereon, provided however that in the
event NYSEG performs any such work, NYSEG shall assume all responsibility for
compliance with the terms and conditions of this Agreement applicable to such
NYSEG work. TELERGY East shall investigate and resolve any and all complaints
arising from or in connection with such construction in an expeditious manner.
TELERGY East shall not place any material on NYSEG property that is recognized
by appropriate governmental authority as toxic/hazardous material, equipment and
waste.
8.3 TELERGY East shall comply with NYSEG 's construction standards and
policies in the construction of the System. Any changes necessary to NYSEG 's
overhead and underground facilities necessitated by this Agreement as reasonably
determined by NYSEG will be made by NYSEG at TELERGY East's sole cost and
expense.
ARTICLE IX
NYSEG 'S EXPENSES AND EMPLOYEE COSTS
9.1 NYSEG 's reasonable costs and expenses for any work performed at the
request of TELERGY East pursuant to the terms hereof, including necessary
construction in public right-of-way, shall be paid by TELERGY East within thirty
(30) days of the date of an accurate invoice including appropriate
documentation. Such expenses of NYSEG shall be in accordance with NYSEG 's
standard external billing practices. NYSEG shall present such expenses to
TELERGY
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East monthly for payment via an itemized invoice, together with supporting
documentation of the incurred costs for the previous thirty (30) day period.
ARTICLE X
INDEPENDENT CONTRACTOR STATUS
10.1 NYSEG reserves no control whatsoever over the employment, discharge,
compensation of or services rendered by TELERGY East's employees or contractors,
and it is the intention of the parties that TELERGY East shall be and remain an
independent contractor and that nothing herein shall be construed as
inconsistent with that status or as creating or implying any partnership or
TELERGY East between NYSEG and TELERGY East.
ARTICLE XI
TAXES
11.1 TELERGY East shall pay all transfer taxes, documentary stamps,
recording costs or fees, or any similar expense in connection with the recording
or filing of any memoranda or short form of the Agreement describing the
Right-of-Occupancy granted to TELERGY East hereby. TELERGY East further agrees
that if it is determined by any state or local governmental authority that the
sale, acquisition, license, grant, transfer or disposition of any part or
portion of the Rights-of-Occupancy herein described requires the payment of any
taxes, including but not limited to sales, use, real property, ad valorem,
transfer gains taxes, or tax on the furnishing of utility services under any
statute, regulation or rule, TELERGY East shall pay the same, plus any penalty
or interest thereon, directly to said taxing authority, and shall hold NYSEG
harmless therefrom; provided, however, TELERGY East said obligation to hold
NYSEG harmless shall not apply to any penalty or interest due in respect of the
delinquent payment of any such tax where the delinquency shall result due to
NYSEG 's failure to promptly notify TELERGY East of the assessment and/or levy
of such tax and/or the receipt of any invoice or xxxx in respect thereof.
11.2 TELERGY East shall pay all annual or periodic real property, personal
property, gross receipts, franchise tax or other taxes levied or assessed upon
the Right-of-Occupancy, System or Facilities, or on account of their existence,
and shall indemnify NYSEG against the payment thereof. TELERGY East shall be
responsible for the filing of any and all returns or other filings in respect of
such personal property taxes.
11.3 To the extent that NYSEG is required to make any kind of submission
or filing with any governmental or regulatory authority which could effect the
amount of any tax that TELERGY East must pay pursuant to this Agreement, NYSEG
shall coordinate such submission or filing, and the information contained
therein, with TELERGY East. Further, NYSEG agrees that it shall provide TELERGY
East prompt notice of the receipt of any notice of assessment in respect of the
Rights-of-Way, or any portion thereof, which may include as an increment of the
amount of such assessment a sum which is attributable to this Agreement and/or
the System and/or the Facilities. TELERGY East shall have the right to protest
any such levy or assessment in respect of any such tax or other fee or charge
which TELERGY East is obligated to pay in accordance with the Agreement, or to
make claim for refund, rebate, reduction or abatement of any of said taxes.
Further, TELERGY East shall have the right to protest any assessment of which it
has been given
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notice pursuant to this Article. NYSEG shall cooperate, where appropriate, with
TELERGY East, at TELERGY East's cost and expense, in the prosecution of any
protest regarding the assessment and/or levy or any claim for refund, rebate,
reduction or abatement of said taxes.
11.4 The Backbone Network, any Spurs, the Cornell Project, Facilities and
the System installed on NYSEG 's Right-of-Way shall be and remain at all times
the personal property of TELERGY East regardless of the manner or method of
installation. The parties agree to execute all reasonable documentation
requested to evidence such ownership.
ARTICLE XII
NOTICES
12.1 Any notice to be given to NYSEG under this Agreement shall be sent by
certified mail or overnight express delivery:
(one copy each to):
New York State Electric & Gas Corporation
Corporate Drive
Kirkwood Industrial Park
Xxxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
and
New York State Electric & Gas Corporation
0000 Xxxxxx Xxxx. Xxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxx Xxxxxx
12.2 Any notice given to TELERGY East under this Agreement shall be sent
by certified mail or overnight express delivery:
(one copy each to):
Telergy East, LLC
Xxx Xxxxxxx Xxxxxxx
Xxxx Xxxxxxxx, Xxx Xxxx 00000
Attn: President
and
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Telergy, Inc.
00 Xxxxxxxxx Xxxxx Xxxxxxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: General Counsel
Notice shall also be given to such other parties as may be designated in writing
to the other party.
12.3 Unless otherwise herein set forth, notices shall be sent, postage
prepaid, either by registered or certified U.S. Mail, Return Receipt Requested,
or by overnight express delivery service, and shall be deemed served or given
when received by the addressee, as evidenced by the date of the Return Receipt
or the receipt provided by the delivery service. In case of an emergency
demanding immediate examination or repairs of the Facilities by NYSEG, notice
shall be given by either party to the other in person or by telephone to the
emergency response center designated in writing by each party to the other. Each
party giving such notice shall follow up with written notice within three (3)
business days.
ARTICLE XIII
LIABILITIES AND INDEMNIFICATION
13.1 To the fullest extent permitted by law, TELERGY East ("Indemnitor")
agrees to defend, indemnify and save NYSEG , its agents and employees
("Indemnitee") harmless from and against any and all liabilities, cost, suit
charge, expenses, claims, losses, damages, cause of action, bodily injury or
death of any person whomsoever (including employees of the parties), or damage
to any property, real and personal, including environmental damages, and
economic damages to property of NYSEG, TELERGY East or other third parties
legally on the Right-of-Way (whether owned, leased or licensed), including but
not limited to TELERGY East's Facilities, and all costs and expenses, including
legal expenses, incurred or sustained in enforcing this indemnification, caused
by, arising out of or in any way connected with this Right-of-Occupancy or the
construction, installation or subsequent operation, maintenance, repair,
replacement, reinstallation, relocation or removal of TELERGY East's Facilities,
unless such loss, injury or damage shall have resulted from the negligent act or
omission to act of NYSEG or its agents, employees or contractors.
13.2 To the fullest extent permitted by law, NYSEG agrees to defend,
indemnify and save TELERGY East harmless from and against any and all claims,
losses, damages, bodily injury or death of any persons whomsoever, including
employees of the parties, or damage to any property, including property of NYSEG
or TELERGY East or other third parties legally located on the Right-of-Way
(whether owned, leased or licensed), including TELERGY East's Facilities and all
costs and expenses, including legal expenses, incurred or sustained in enforcing
this indemnification, caused by, arising from or growing out of (i) the
negligent act or omission to act of NYSEG or its agents, employees or
contractors, or (ii) TELERGY East having followed NYSEG 's express written
instructions as to the manner, means or methods of performing any act.
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13.3 Either party ("Indemnitor") shall have the right to defend the other
party ("Indemnitee"), by counsel of the Indemnitor's selection reasonably
satisfactory to the other party ("Indemnitee"), with respect to any claims
within the indemnification provisions hereof. The parties shall give each other
prompt notice of any asserted claims or actions indemnified against, shall
cooperate with each other in the defense of any such claims or actions and shall
not settle any such claims or actions without the prior consent of the
indemnifying party ("Indemnitor").
13.4 Neither of the parties shall be liable to the other for special,
consequential or exemplary damages (including, without limitation, any claims
from any client, customer or patron of either party for loss of services)
arising under this Agreement or from the breach of any of the provisions hereof.
13.5 The obligations of the respective parties under this Article thirteen
shall survive the expiration date in respect of any occurrences within the term.
ARTICLE XIV
INSURANCE
14.1 From the commencement of the Work, through the term of this
Agreement, TELERGY East shall provide at its own expense, insurance policies,
issued by reputable insurance companies acceptable to NYSEG which meet or exceed
the requirements listed herein:
A. Workers Compensation and Employers Liability Insurance required
by the State of New York. Coverage shall included the U.S. Longshoremen's and
Harbor Workers Compensation Act and the Xxxxx Act.
B. Public Liability, covering all operations to be performed under
this Agreement, with minimum limits of:
- Bodily Injury $1,000,000/$1,000,000
- Property Damage $ 500,000 /$ 500,000
OR
- Combined Single Limit $1,000,000
OR
- BI & PD per occurrence $1,000,000
- General Aggregate and
Product Aggregate $2,000,000
14.2 This policy shall include Contractual Liability, Products-Completed
Operations and Explosion, Collapse and Underground (XCU) coverage. If the
Products-Completed Operations
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coverage is written on a Claims-made basis, coverage shall be maintained
continuously for at least two (2) years after final acceptance of the work.
14.3 Automobile Liability, covering all owned, non-owned and hired
vehicles used in connection with the work to be performed under this
Contract with minimum limits of:
- Bodily Injury $300,000/$500,000
- Property Damage $100,000
OR
- Combined Single Limit $500,000
14.4 Protective Liability Policy in the name of NYSEG covering all work
performed under the contract, with limits as specified in Section 14.1. In lieu
of providing this coverage, TELERGY East may include NYSEG as an additional
insured under the public liability policy to provide coverage for, but not
limited to, the liability arising out of the TELERGY East's work under this
Agreement.
14.5 Watercraft Liability, if the Work requires the use of watercraft,
with the same limit of liability of not less than $1,000,000 combined single
limit.
14.6 Aircraft Liability, if Work requires the use of aircraft, with a
limit of liability of not less than $1,000,000 combined single limit.
14.7 At the request of NYSEG , TELERGY East shall provide Professional
liability coverage with a limit of liability to be determined by NYSEG 's Risk
Management Department.
14.8 In the event TELERGY East uses subcontractors in connection with this
Agreement, it shall require all subcontractors to provide the same insurance
coverage as required in Article XIV herein.
14.9 Prior to starting work, TELERGY East shall promptly provide NYSEG
with the original Owner's Protective Liability policy and (a) Certificate(s) of
Insurance for all other coverages required herein at the following address:
NYSEG
ATTN: Risk Management
_________________________________
_________________________________
_________________________________
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Such certificates, and any renewals or extensions thereof, shall provide
that at least thirty (30) days prior written notice shall be given to NYSEG in
the event of any cancellation or diminution of coverage.
14.10 Reservation of Liens - If any policy should be canceled prior to the
period set forth in this Agreement, and the TELERGY East fails immediately to
procure other insurance as specified herein, NYSEG reserves the right to procure
such insurance and to charge the cost to TELERGY East.
14.11 TELERGY East shall furnish NYSEG with copies of any accident reports
sent to TELERGY East's insurance carriers covering accidents occurring in
connection with or as a result of the performance of work under this Agreement.
14.12 TELERGY East shall furnish NYSEG with a certificate of such
insurance and of renewals thereof prior to the expiration of any such
policy(ies) and shall name NYSEG as an additional insured under its respective
policy(ies), if any.
14.13 All insurance shall be effected by valid and enforceable policies
issued by insurers of responsibility and licensed to do business in the State of
New York, such responsibility and the insuring agreements to meet with the
reasonable approval of NYSEG and TELERGY East. The limits of the policies
required hereunder shall be increased from time to time by agreement of the
parties to meet changed circumstances including, but not limited to, changes in
the purchasing power of the dollar and the course of plaintiff's verdicts in
personal injury actions; provided, however, such limits shall not be increased
more frequently than every five (5) years. In recognition of the potential for
changes in the insurance market and the availability and cost of insurance, the
parties hereby expressly agree that, in the event that either (i) the insurance
required of either party hereunder shall cease to be available (either as to
limits or coverages) or (ii) such insurance shall be available only at excessive
cost, the parties shall agree upon alternative policy limits and/or coverages,
as well as appropriate levels of self-insurance for both parties.
14.14 Nothing in this Article XIV shall be construed as to prevent TELERGY
East from satisfying its insurance obligations pursuant to this Agreement under
a blanket policy or policies.
ARTICLE XV
LIENS
15.1 In the event that any property of NYSEG shall become subject to any
mechanics, artisan or materialmans liens chargeable to or through TELERGY East,
it shall promptly cause such lien to be discharged and released of record, by
payment, posting of bond, court deposit or other means, without cost to NYSEG
and shall indemnify NYSEG against all costs and expense, including reasonable
attorneys' fees, reasonably incurred in discharging and releasing such lien;
provided, however, that if any such lien is not so discharged and released
within thirty (30) days after notice thereof by NYSEG to TELERGY East, or within
such shorter period as shall be mandated under applicable local law, then NYSEG
may pay or secure the release or discharge thereof at the expense and cost of
TELERGY East.
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15.2 Subject to the other terms and conditions of this Agreement, NYSEG
shall keep TELERGY East Facilities free and clear of all liens or other
encumbrances which arise in any way from or as a result of NYSEG 's activities
and cause any such liens or encumbrances which may arise to be discharged or
released of record as provided in this Article within thirty (30) days after
notice thereof by TELERGY East to NYSEG , or within such shorter period as shall
be mandated under applicable local law, then NYSEG may pay or secure the release
or discharge thereof at the expense and cost of TELERGY East.
15.3 Nothing herein shall preclude TELERGY East and/or NYSEG as the case
may be from contesting any such lien or the contract or action upon which the
same arose after the same shall have been bonded as described above.
15.4 TELERGY East hereby recognizes and agrees that this Agreement shall
be subject and subordinate to the provisions of the first mortgage indenture
dated October 1, 1937, as amended, from NYSEG 's predecessor, Central New York
Power Corporation, to the Marine Midland Trust Company of New York, now Marine
Midland Bank, N.A., as Trustee. Notwithstanding such subordination, except for
the NYSEG Capacity, NYSEG hereby recognizes and agrees that the System shall be
and remain at all times the personal property of TELERGY East and the System
shall at no time be or become subject to or collateral under said first mortgage
indenture.
ARTICLE XVI
AMENDMENTS
16.1 Each party shall be responsible for its own costs, including legal
fees, incurred in negotiating or finalizing this Agreement.
16.2 Neither this Agreement nor any term or provision hereof can be
amended, waived, modified, supplemented, discharged or terminated, except by an
instrument in writing signed by the party against which enforcement thereof is
sought.
16.3 This Agreement and any amendment, modification, waiver or supplement
hereto may be executed by the parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original for all purposes, but
all such counterparts shall together constitute but one and the same instrument.
ARTICLE XVII
PROCEDURES
17.1 TELERGY East's Facilities shall be placed, maintained, relocated or
removed in accordance with NYSEG's Standards, including but not limited to the
current editions of NYSEG 's Underground Standards for Construction, the
National Electric Code (NEC), the National Electrical Safety Code (NESC), Rules
and Regulations of the Occupational Safety and Health Act (OSHA) and any
governing authority having jurisdiction. Where a difference in specification may
exist, the more stringent shall apply. TELERGY East's Facilities shall not
physically, electronically or inductively interfere with NYSEG 's Conduit System
or other Facilities.
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17.2 NYSEG reserves the right to specify the type of construction
standards required in situations not otherwise covered in this Agreement. In
such cases, NYSEG will in its discretion furnish to TELERGY East written
material which will specify and explain the required construction. Subject to
Paragraph 17.1, TELERGY East shall have the right to select the type of fiber
optic cable to be installed.
17.3 At TELERGY East's discretion, Facilities installation may be
performed by NYSEG, NYSEG 's designated contractor, or TELERGY East or its
subcontractor, following completion of Make-Ready Work and delivery of
Facilities by TELERGY East to NYSEG. TELERGY East shall have the right to
conduct testing of its Facilities in accordance with mutually agreed-upon
standards (which will be provided and agreed upon prior to installation)
following the completion of fiber optic installation to insure that agreed-upon
design specifications have been met. Splices in TELERGY East fiber optic cables
shall be located only in manholes, pull boxes or handholes.
17.4 TELERGY East shall be responsible for any problems from or in its
Facilities, excepting such as may have been caused by the negligence of NYSEG as
provided for herein.
17.5 Should NYSEG for its own requirements (other than those imposed by
regulatory or legal rules, orders and requirements as contemplated in Section
7.1 of this Agreement), need to install additional conduit, gas or other
facilities or modify such conduit, gas or other facilities in which TELERGY East
has a Right-of-Occupancy, NYSEG shall notify TELERGY East and if Telergy East
desires to utilize additional Rights-of-Way associated with NYSEG's installation
of additional conduit, gas or other facilities, NYSEG shall pay the costs of
such relocation Notification of any relocation by NYSEG shall be given in
writing not less than thirty (30) days before any such modification except in
emergency situations, and TELERGY East shall have the option either to (i)
relocate at NYSEG's costs unless the relocation is required as contemplated in
Section 7.1, or (ii) terminate its use of such facilities and the payment of
dark fiber along the area subject to relocation without further liability to
NYSEG. NYSEG agrees that whenever it performs construction related activities or
installs, or upgrades underground conduit or gas facilities or with respect to
installations through building entrances, it will notify TELERGY East in advance
so that TELERGY East can simultaneously install fiber or conduit for its System
under proportionate cost sharing arrangements to be agreed upon by the parties.
17.6 All maintenance work for Facilities of TELERGY East shall be the
responsibility of TELERGY East. Recognizing that time may be of the essence,
upon a request from TELERGY East to perform maintenance with respect to NYSEG 's
facilities where maintenance is required on NYSEG facilities and such lack of
maintenance is interfering with TELERGY East Facilities, NYSEG shall investigate
reported interruptions of TELERGY East Facilities, within a reasonable time
frame. Repair or restoration of failed Facilities will be dictated by
investigated findings. At TELERGY East's discretion TELERGY East, or its
designated contractor will perform all work necessary for repair or restoration
of its Facilities. NYSEG 's inspector shall have the right to be present and
oversee TELERGY East's repair activities, and to terminate such activities when,
in the inspector's discretion, said activities pose a danger to NYSEG 's
facilities. Notwithstanding the foregoing provision, NYSEG agrees that if a
contractor or subcontractor is designated for
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maintenance work required to repair and restore service interruptions of TELERGY
East's Facilities, a qualified telecommunications maintenance company selected
by TELERGY East shall be granted access to the affected Right-of-Way under such
reasonable terms and conditions as may be set by NYSEG, for the purpose of
restoring service interruptions within such fixed period of time as may be
necessary under the circumstances. NYSEG agrees to have supervisory personnel
available within such period of time in order to supervise the maintenance work
required to repair and restore service interruptions. TELERGY East shall have
the right, subject to NYSEG 's availability, to inspect its Facilities
periodically, upon three (3) days advance written notice to NYSEG. Such
inspection costs shall be borne solely by TELERGY East.
ARTICLE XVIII
LIABILITY AND DAMAGES
18.1 NYSEG reserves to itself, its successors and assigns, the right to
relocate and maintain its Right-of-Way, Conduit, duct and all of its facilities
and to operate its facilities in conjunction therewith in such a manner as will
best enable it to fulfill its own service requirements, with costs associated
with such relocations to be paid as set forth in Sections 7.1 and 17.5 of this
Agreement, provided however that once Telergy installs any portion of its Fiber
Optic Network, System or the Cornell Project in Right-of-Way pursuant to this
Agreement, NYSEG shall not be entitled to interfere with the operation of the
Network except as expressly provided in this Agreement. In emergency situations,
TELERGY East shall be required to act immediately where practicable to
coordinate any emergency responses with NYSEG, including but not limited to any
expedited removal or relocation of TELERGY East Facilities that may be required
in such emergency.
ARTICLE XlX
TERMINATIONS OF AUTHORIZATIONS
19.1 In addition to rights of termination provided to NYSEG under other
provisions of this Agreement, NYSEG shall have the right to terminate a
Right-of-Occupancy granted pursuant to the provisions of this Agreement where:
a. TELERGY East' Facilities are maintained or used in violation of any law
or in aid of any unlawful act or undertaking, or
b. TELERGY East ceases to have authority to construct and operate its
System on public or private property covered by the Right-of-Occupancy; or
c. TELERGY East fails to comply with any of the terms and conditions of
this Agreement or defaults in any of its obligations thereunder.
d. TELERGY East Facilities occupy NYSEG 's Right-of-Way without having
first been issued a Right-of-Occupancy therefor; or
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x. XXXXXXX Xxxx Facilities or Right-of-Occupancy are used by others not a
party to this Agreement (excluding TELERGY East's customers, carriers and
lessees) without the prior written consent of NYSEG, which consent shall not be
unreasonably withheld, provided, however, that a lawful successor of TELERGY
East under the LLC Operating Agreement shall be deemed a party to this
Agreement.
f. TELERGY East's Right-of-Occupancy can be terminated by NYSEG wherever
and whenever a governmental agency requires the same, in which case NYSEG will
return TELERGY East's Facilities to TELERGY East and at TELERGY East shall
remove the same at its expense less any otherwise proper credits accruing to
TELERGY East.
g. TELERGY East's insurance carrier shall at any time notify NYSEG that
the policy or policies of insurance as required in Article V (1) will be or have
been canceled or amended so that those requirements will no longer be satisfied;
or
h. any authorization which may be required by any governmental or private
authority for the construction, operation and maintenance of TELERGY East's
Facilities in the Conduit System is denied, revoked or canceled.
19.2. Notwithstanding the above, TELERGY East shall have the right to cure
the above stated defaults within thirty (30) working days of written notice by
NYSEG to TELERGY East of said default. Upon receipt of said written notice,
TELERGY East shall notify, within five (5) working days, NYSEG of its intention
to cure the default within the said 30-day period set forth above. If TELERGY
East fails to give such five days notice or if TELERGY East advises NYSEG that
it does not intend to cure, then TELERGY East shall be deemed in default and the
thirty (30) working-day period for cure shall not apply.
19.3 In the event NYSEG's desires to abandon property utilized by Telergy
East, NYSEG may at any time terminate a portion of the Right-of-Occupancy upon
the earlier of written notice to Telergy East to be given six (6) months in
advance or as soon as NYSEG decides to abandon any such property in accordance
with any applicable regulatory or legal requirements, which notice shall specify
that East, that NYSEG no longer requires the underlying Right-of-Way for its own
public utility purposes for whatever reason, or the affected portion thereof,
for its own electric and gas purposes. NYSEG will, on a best efforts basis,
attempt to provide other Right-of-Way or Facilities to meet TELERGY East's
needs, however, Telergy East will be required to relocate its Facilities in
other NYSEG or third party Right-of-Way within be six (6) months from the date
of notification at Telergy East's sole cost. In the event of termination of any
of TELERGY East authorizations hereunder, TELERGY East will remove or abandon,
TELERGY East's Facilities within ninety (90) days of the effective date of the
termination; provided, however, that TELERGY East shall be liable for and pay
all fees and charges (including dark fiber) pursuant to provisions of this
Agreement to NYSEG until the expiration of the 90 day period or TELERGY East
Facilities are actually removed, abandoned or maintenance is taken over by
NYSEG, whichever comes first and provided further that each party shall be
required to perform any and all obligations under this Agreement until such
time. NYSEG shall have the right to remove such Facilities at TELERGY East's
expense and without any liability on the part of NYSEG for damage or injury to
such Facilities or interruption of
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TELERGY East's services except for liability for damage or injury to such
Facilities caused by the negligence of NYSEG or its agents or employees.
ARTICLE XXI
MISCELLANEOUS PROVISIONS
Disputes. It is the intent of the parties that disputes which may arise between
them, or between employees of each, be resolved as quickly as possible, and may,
in certain instances, involve decisions made on the spot. When such resolution
is not possible, and depending upon the nature of the dispute and the phase of
installation of the Facilities and System, the parties agree to seek to resolve
such disputes, insofar as they do not constitute a breach or default under this
Agreement, in the manner set forth in this section.
Headings. The Article headings in this Agreement and the Table of Contents
hereof are for convenience of reference only and shall neither be deemed to be a
part of this Agreement nor modify, define, expand or limit any of the terms or
provisions hereof. All references to numbered or lettered Articles or Sections,
unless otherwise indicated are to Articles or Sections of this Agreement. Words
and definitions in the singular shall be read and construed as though in the
plural and vice versa, and words in the masculine, neuter or feminine gender
shall also be read and construed as though in either of the other genders.
Mergers. Neither party shall be prohibited by the terms of this Agreement from
undertaking any merger or acquisition activity whether voluntary or involuntary,
and all such activity shall not hinder, impede, alter or vary the terms,
conditions and covenants of this Agreement. The parties agree that neither shall
proceed against the other by litigation or otherwise before the offending party
has had notice of and reasonable time and opportunity to respond to and/or cure
any breach or default hereunder; and, for purposes of this Agreement, a
reasonable time to cure any breach or default shall be deemed to be fifteen (15)
days after notice, in the case of a monetary default; sixty (60) days after
notice in the case of a non-monetary default, unless the nature of the default
in question is such that it is not reasonably susceptible of being cured within
such 60-day period, then if the curing thereof shall not have commenced within
such period and shall not thereafter be prosecuted to completion with reasonable
diligence. Any waiver by either party at any time of any of its rights as to
anything contained herein shall not be deemed to be a waiver of the same or
similar right at a subsequent time.
Representations. Except as otherwise provided, each of the parties represents,
warrants and covenants to the other that: (i) it has full right and authority,
including any requisite corporate and governmental approvals, to enter into and
to perform its respective obligations under this Agreement; (ii) the execution
of this Agreement is not violative of its charter, by-laws or any laws or
regulation by which it is bound or to which it subject; (iii) no litigation or
governmental proceeding is pending or threatened which might adversely affect
this Agreement, the transactions contemplated by this Agreement, or the rights
of the parties hereunder.
Contingencies. TELERGY East's and NYSEG 's performance under this Agreement are
contingent upon a favorable determination by the New York Public Service
Commission and any
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authorized Federal or State agency, which determination shall not be subject to
appellate review. In the event that the necessary approvals are not obtained on
or before October 31, 1998, either party shall have the option of terminating
this Agreement by written notice to the other party pursuant to the Notice
provisions set forth in Articles 12.1 and 12.2. Except for a termination for
failure to obtain PSC Approval or a breach by NYSEG, TELERGY East shall
reimburse NYSEG for all costs incurred in connection with the termination of
this Agreement.
Force Majeure. Any failure of either party to perform its obligations under this
Agreement shall not be a breach of this Agreement if such failure results from
Acts of God, governmental action that did not result from wrongdoing by the
party involved in such governmental action, omissions of third parties when such
omissions did not occur due to action or inaction or the party failing to
perform, or labor strikes or walkouts that could not reasonably be avoided by
the party subject to such labor strike or walkout.
No Waiver. The rights and remedies provided by this Agreement are cumulative and
the use of any one right or remedy by any party shall not preclude or waive its
right to xxx on any or all other remedies. Said rights and remedies are given in
addition to any other rights such party may have by law, statute, ordinance or
otherwise, except as such remedies are expressly limited in this Agreement.
Any provision of this Agreement which is invalid, illegal or unenforceable
in any manner in any jurisdiction shall be, as to such jurisdiction, ineffective
to the extent of such invalidity, illegality or unenforceability without in any
ways affecting the validity, legality or enforceability of the remaining
provisions hereof, and any such invalidity, illegality or unenforceability in
any jurisdiction shall not invalidate or in any way affect the validity,
legality or enforceability of such provision in any other jurisdiction.
Assignment, Subletting and Other Transfers. TELERGY East shall not assign,
sub-license, sublet or transfer ("Assignment") any authorization granted herein,
and such authorization shall not inure to the benefit of TELERGY East's
successors or assigns without the prior written consent of NYSEG, except as
provided in the LLC Operating Agreement, and, where necessary upon approval from
the Public Service Commission. In the event of any such assignment, the
provisions of this Agreement shall apply to and bind the TELERGY East's
successors and assigns.
Compliance with Applicable Laws. NYSEG and TELERGY East shall at all times
observe and comply with the provisions of this Agreement, and such provisions
are subject to all laws, ordinances, contracts and regulations which in any
manner affect the rights and obligations of the parties herein.
Other Agreements. Nothing contained herein shall be construed as a limitation,
restriction, or prohibition against NYSEG with respect to any Right-of-Occupancy
agreements and arrangements which NYSEG has entered into, or may in the future
enter into, with others not covered by this Agreement, except that
Right-of-Occupancies existing at the time of such future grants of
Right-of-Occupancy to NYSEG Right-of-Way, agreements or arrangements shall not
interfere with or be subordinated to the rights of any subsequent third parties.
The rights of TELERGY East shall at all times be subject to such existing
Right-of-Occupancy agreements or arrangements, and all
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future Rights-of-Occupancy shall be subject to Telergy East's rights hereunder.
NYSEG, in negotiating and entering into any such future Right-of-Occupancy,
agreements and/or arrangements, shall not diminish the Right-of-Occupancy of
TELERGY East, as provided for in this Agreement.
Notwithstanding any other provision of this Agreement, TELERGY East as a
common carrier, shall have the right, subject to the terms and conditions of
this Agreement, to permit TELERGY East's customers to use a portion of the
capacity or fiber on TELERGY East's Facilities.
Entire Agreement.. This Agreement constitutes the entire agreement between the
parties with regards to TELERGY East's use of NYSEG 's system. It may not be
modified or amended nor may any obligation of either party be changed or
discharged except in writing signed by the duly authorized officer or agent of
the party to be charged. Prior written notice of changes in any applicable pole
rates (to be approved by the Public Service Commission) shall be given to
TELERGY East five (5) days advance of any such filing with the Public Service
Commission.
Governing Law. This Agreement shall be governed by, and interpreted according
to, the laws of the State of New York, without giving effect to the principles
of conflicts of law. No claim, demand, action, proceeding, arbitration,
litigation, hearing motion or lawsuit arising from, related to, or connected
with this Agreement shall be commenced or prosecuted in any jurisdiction other
than the State of New York, and any judgment, determination, order, finding or
conclusion reached in any other jurisdiction shall be null and void between the
parties hereto.
Bankruptcy. Subject to the rights of the principles of the TELERGY East, in the
event that either of the principles of TELERGY East is involved in a bankruptcy
as defined in Article II of this Agreement, or in the event that the interest of
the TELERGY East in the System becomes the subject of garnishment, attachment or
tax lien proceeding, and in the further event that such a petition and/or
proceeding shall not be quashed or removed within thirty (30) days after filing,
service or levy, whichever first occurs, NYSEG shall have the right and option
within thirty (30) days after the expiration of such thirty (30) day period to
purchase "proportionately the interest encumbered as the "computed" value
payable in cash within that thirty (30) day period.
"Proportionately" shall mean that portion of the undivided interest in the
property involved in such bankruptcy, garnishment, attachment or tax lien
proceeding, which the undivided interest owned by a TELERGY East bears to all of
the undivided interest in the subject property other than that involved in such
bankruptcy, garnishment, attachment of tax lien proceeding.
"Computed value" shall mean the value of the undivided interest in the
subject property as computed by the regularly retained certified public
accountants of the TELERGY East. Such computation shall be binding and
conclusive upon the parties absent manifest error.
Binding Agreement. The provisions of this Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their lawful respective
successors and assigns.
Acts In Furtherance. NYSEG and TELERGY East each agree to do such other and
further acts and things, and to execute and deliver such additional instruments
and documents, not creating any
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obligations, or imposing any expenses, additional to those otherwise created or
imposed by this Agreement, as either party may reasonably request from time to
time whether at or after the execution of this Agreement, in furtherance of the
express provisions of this Agreement.
Environmental Hazard Liability. NYSEG agrees to promptly inform TELERGY East of
any such hazardous or toxic waste areas, whether or not designated as such by
the Environmental Protection Agency or any other similar federal, state or local
authority, of which NYSEG 's Environmental Affairs Department, Syracuse, New
York, has knowledge of or of which such Department may subsequently learn with
respect to the Backbone Route. NYSEG agrees to defend, indemnify and hold
TELERGY East harmless from any and all claims, fines and actions arising out of
the existence of any such hazardous or toxic waste areas or the obligations
which may now or hereafter be imposed, statutory or otherwise, to remove
therefrom or otherwise neutralize or contain, any such toxic or hazardous
substances, unless such liability is: (i) created by a release by TELERGY East
or its contractors or subcontractors excluding NYSEG of a toxic or other
hazardous substance into the environment, (ii) created by TELERGY East's
disturbance of a pre-existing condition within the Right-of-Way of which TELERGY
East had knowledge provided that NYSEG shall disclose to TELERGY East all such
pre-existing conditions within the Backbone Route known to NYSEG , or (iii)
created by TELERGY East's disturbance of a pre-existing condition within the
Right-of-Way where the condition was not previously known by NYSEG and was not
created by a disturbance by NYSEG.
Upon learning of any such hazardous or toxic waste areas within which the
Right-of-Occupancy is intended to be or is located, NYSEG shall, within thirty
(30) working days, to the extent available to it, offer TELERGY East, without
payment of any additional consideration therefor, alternate contiguous areas
within which the Backbone Route may be relocated to avoid such hazardous or
toxic waste areas.
In the event TELERGY East discovers, or has knowledge of hazardous or
toxic waste areas, whether or not designated as such the Environmental
Protection Agency or any other similar federal, state or local authority, it
shall immediately stop work if discovered during construction, and notify the
Director of NYSEG 's Environmental Affairs Department in Binghamton, New York.
In Witness Whereof, the parties hereto have executed this Agreement in
duplicate on the date and year first above written.
WITNESS (ATTEST) NEW YORK STATE ELECTRIC & GAS CORPORATION
_______________________ By:_______________________________________
Name:_____________________________________
Title: _____________________________________
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WITNESS (ATTEST) TELERGY EAST, LLC
_______________________ By:_________________________________________
Name:_______________________________________
Title: ________________________________________
30
