HomeMy WebLinkAboutOrdinance 19091-04-2010ORDINANCE NO 19091-04-2010
AN ORDINANCE REPEALING ORDINANCE NO 15760 (ORDINANCE
GRANTING A FRANCHISE TO STRATEGIC CABLE TECHNOLOGIES,
L.P FOR USE OF PUBLIC RIGHTS-OF WAY IN THE CITY OF FORT
WORTH FOR THE PURPOSE OF CONSTRUCTING, MAINTAINING
AND OPERATING A CABLE TELEVISION SYSTEM), TERMINATING
THE FRANCHISE AGREEMENT BETWEEN THE CITY OF FORT
WORTH AND STRATEGIC CABLE TECHNOLOGIES, L.P
REGARDING CONDITIONS AND REQUIREMENTS RELATED TO THE
USE OF PUBLIC RIGHTS-OF WAY IN THE CITY OF FORT WORTH
AND TO THE CONSTRUCTION, MAINTENANCE AND OPERATION
OF A CABLE TELEVISION SYSTEM AND TO THE PROVISION OF
CABLE SERVICES TO RESIDENTS OF THE CITY OF FORT WORTH
AND TO REASONABLE COMPENSATION TO THE CITY OF FORT
WORTH FOR THE USE OF THE PUBLIC RIGHTS-OF WAY,
CONSENTING TO THE SALE OF SUCH CABLE SYSTEM TO MARCUS
CABLE ASSOCIATES, L.L.C. D/B/A CHARTER COMMUNICATIONS,
AND PROVIDING AN EFFECTIVE DATE.
The following statements are true and correct and constitute the basis upon which the
City Council of the Crty of Fort Worth ("City") has adopted this Ordmance•
A. On December 2, 2003 the City Council adopted Ordinance No 15760 granting to
Strategic Cable Technologies, L.P ("SCT") a franchise (the "Franchise") to use public rights-
of way m the City for the purpose of constructing, mamtaimng, and operating a cable television
system (the `System"), conditioned upon execution by SCT of a Franchise Agreement attached
thereto (the "Franchise Agreement") The Franchise was granted m accordance with
applicable federal law prior to enactment of Chapter 66 Texas Utilities Code, which allows
certain cable operators to obtain franchise authority from the State of Texas rather than local
governments.
B SCT wishes to sell its System to Marcus Cable Associates, L.L.C d/b/a Charter
Communications ("Charter") The Franchise prohibits SCT from the sale or assignment of the
Franchise or its System to another entity without the pnor written consent of the Crty
C Charter is authorized to provide cable television services m the Crty pursuant to a state
issued certificate of franchise authority governed by Chapter 66 Texas Utilities Code. SCT has
requested that, to lieu of a transfer of the Franchise to Charter the City agree to terminate the
Franchise and allow Charter to operate the System under its state issued franchise.
D The Franchise provides the City with certain valuable regulatory rights that rt cannot
avail itself of under a state issued certificate of franchise authority As a result, the City is
willing to terminate the Franchise only upon execution of a separate Settlement Agreement
between the Crty and SCT pursuant to which, among other things, SCT pays the Crty the sum of
$60 000 00 which the City agrees is a reasonable estimation of the present value of the benefits
1
Ordinance Terminating Cable Television Franchise
with Strategic Cable Technologies, Inc.
provided under the Franchise that the City would otherwise be depraved of if the Franchise were
terminated praor to expiration of rts term.
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS
I.
THAT the City Council hereby repeals Ordinance No 15760 and terminates the Franchise
Agreement with SCT attached thereto effective upon execution by both the City and SCT of a
Settlement Agreement in substantially the same form as that attached hereto as Exhibit "A" (the
"Settlement Agreement"). The City Council further consents to the sale and transfer of the
SCT System to Charter
ADOPTED• Apra16, 2010 G 16878
Date M & C Number
EFFECTIVE DATE ~ ~ C~
APPROVED AS TO FORM AND LEGALITY
Peter Vaky
Assistant City Attorney
2
Ordinance Terminating Cable Television Franchise
with Strategic Cable Technologies, Inc.
EXHIBIT A (~+~ i~c~'r~r
ORDINANCE NO 19091-04-2010 tC•,• ~ _~O
SETTLEMENT AGREEMENT
1 This Settlement Agreement ("Agreement") is entered into this ~ day of
April 2010 (the `Effective Date'), by and among the City of Fort Worth Texas (the
`City') Strategic Cable Technologies, L.P ("SCT") and Lennar Corporation ("Lennar")
The City SCT and Lennar sometimes are referred to individually as a Party" and
collectively as the `Parties
2 Effective December 30 2003 the City in Ordinance No 15760 granted
SCT a franchise to construct, install, operate and maintain a cable television system in
the area of Fort Worth Texas, known as Sendera Ranch (the 'Franchise') Lennar the
parent of SCT guaranteed SCT's performance of its obligations under the Franchise
On November 30 2009 SCT sold all the assets used and useful for this cable television
system (the 'System Sale') to Marcus Cable Associates, L.L.C dba Charter
Communications ("Charter") Charter is authorized to operate a cable television system
and to provide cable services to Sendera Ranch pursuant to its State-Issued Certificate
of Franchise Authority granted by the Public Utility Commission of Texas.
3 The Parties, without admitting any facts or liability on any claim or cause
of action, but continuing to deny the same in order to avoid the cost, inconvenience and
burdens associated with contested litigation, desire to compromise and settle certain
outstanding claims between them on the terms set forth herein Therefore for good and
valuable consideration the receipt and sufficiency of which are hereby acknowledged
and in consideration of the promises and covenants set forth in this Agreement, the
Parties agree as follows
SETTLEMENT AGREEMENT
DALLAS 2111495v i Page 1
EXHIBIT A
ORDINANCE NO 19091-04-2010
4 System Sale Approval and Termination of Franchise The City hereby
approves the System Sale and hereby terminates the Franchise effective as of the
Effective Date
5 SCT Payment. On the Effective Date SCT shall pay the City the amount
of $60 000 00
6 Covenant Not to Sue. The City unconditionally covenants that it shall not
commence or maintain any suit or assert any claim, including but not limited to a claim
for a temporary restraining order temporary preliminary or permanent injunction
damages, or other legal or equitable relief that is reasonably calculated to enjoin
obstruct or otherwise interfere in any manner with the System Sale.
7 Mutual Releases. For and in consideration of the agreements and
releases set forth herein effective as of the Effective Date and except for any breach of
this Agreement, SCT and Lennar for themselves and on behalf of their former present,
and future parents, subsidiaries, predecessors successors, shareholders partners,
members, directors, officers, managers employees agents, representatives, insurers,
affiliates, associated entities of every kind and nature and assigns (collectively the
'SCT Parties') hereby release acquit, and forever discharge the City and its former
present and future officials employees agents representatives insurers associated
entities of every kind and nature and assigns (collectively the `City Parties') from all
claims causes of action liabilities demands defenses controversies actions, or debts
of whatever nature or character fixed or contingent, liquidated or unliquidated known or
unknown (collectively the `Claims') which SCT or Lennar has or may have in the future
arising from or relating in any manner to the Franchise or the System Sale arising at
any time from the beginning of time to the Effective Date
SETTLEMENT AGREEMENT
DALLAS t 1 1495v 1 Page 2
EXHIBIT A
ORDINANCE NO 19091-04-2010
8 For and in consideration of the agreements and releases set forth herein
effective upon the Effective Date and except for any breach of this Agreement, the City
for itself and on behalf of the City Parties, hereby releases, acquits and forever
discharges SCT Lennar and all other SCT Parties from all Claims which the City has or
may have in the future arising from or relating in any manner to the Franchise or the
System Sale arising at any time from the beginning of time to the Effective Date.
9 Representations and Warranties. As a material inducement to the Parties
entry into this Agreement, each Party unconditionally represents and warrants at the
signing of this Agreement and delivery of any documents hereunder
(a) that it has carefully read this Agreement, that it has had an
opportunity to discuss its effect with counsel of its choice and that it
fully understands its final and binding effect;
(b) that it has the necessary authority to settle this matter fully on
behalf of itself and all parties whose interests it purports to release
in accordance with the terms of this Agreement, and that the
individuals who execute this Agreement on its behalf are fully
authorized to execute the Agreement and to bind the releasing
parties
(c) that it has not assigned to others, but is the owner of the Claims
released herein and that it has the entire and exclusive authority to
settle them on the terms herein set forth
(d) that it has executed this Agreement as its free and voluntary act,
without any fraudulent inducement, duress coercion or undue
influence exerted by or on behalf of any other Party and
(e) that no promise representation, conduct, or consideration by any
other Party to this Agreement, its owners agents, servants,
employees attorneys or persons in privity with it has induced the
execution of this Agreement except for those representations and
agreements specifically set forth herein
10 Miscellaneous. The provisions of this Agreement comprise all the terms
conditions, agreements, and representations of any of the Parties respecting the
SETTLEMENT AGREEMENT
DALLAS 2111495v.1 Page 3
EXHIBIT A
ORDINANCE NO 19091-04-2010
settlement and compromise of this dispute the matters relative thereto and the matters
respecting this Agreement. This Agreement may not be amended supplemented or
otherwise modified except by further written agreement of the Parties
11 This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective successors insurers, creditors agents, representatives
associated entities and assigns.
12 Neither this instrument, the agreements evidenced hereby nor any related
evidence will be admissible in evidence against any of the Parties in any lawsuit, claim
or arbitration proceeding of any nature except in an action for breach, of to enforce or
to construe the Agreement
13 This Agreement may be executed in multiple counterparts and transmitted
via facsimile or electronic mail any and all of which shall be construed and enforceable
as the Agreement.
14 If any provision of this Agreement is held to be illegal invalid or
unenforceable under present or future laws effective during the term hereof such
provision shall be fully severable and the remaining provisions thereof shall remain in
full force and effect and shall not be affected by the illegal invalid or unenforceable
provision or by its severance therefrom
15 This Agreement shall be construed under the laws of the State of Texas.
Venue for any action under this Agreement shall lie exclusively in state courts located in
Tarrant County Texas or the 'United States District Court for the Northern District of
Texas -Fort Worth Division
16 This Agreement shall not be construed against any Party as the drafting
party
SETTLEMENT AGREEMENT
DALLAS 2l 114y5v I Page 4
EXHIBIT A
ORDINANCE NO 19091-04-2010
17 Each Party will pay its own costs and attorneys fees incurred in
connection with the preparation of this Agreement. In the event that any Party
materially breaches its obligations under this Agreement, and such failure continues
uncured for a period of 30 days after written notice to cure from another Party then
each non-breaching Party shall be entitled to recover any and all costs and expenses
associated with any litigation required to enforce this Agreement, including reasonable
and necessary attorneys fees.
SIGNATURE PAGES FOLLOW
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
SETTLEMENT AGREEMENT
DALLAS 21 11495v 1
Page 5
EXHIBIT A
ORDINANCE NO 19091-04-2010
IN WITNESS WHEREOF this Agreement is executed as of the Effective Date
CITY OF FORT WORTH. TEXAS
~w~~cc~~v~a As To
~fQR~ A,~D LEGIAL.ITY gy~
C- ~75~ Its
ASSlS7ANT ITY ATTORNEY y~y2-/o
Attested by•
Marty Hendr>< ,City
DAI..I.AS 211 1495v I
Date• 09 ; / 2. /O
STRATEGIC CABLE TECHNOLOGIES, L.P
By.
Its ~! • V ~ C~- I~ T-{'` 1 °'l",~-
Date
LENNAR C(~tPORATION
1~ A P
By.
Its. '~
Date
City of Fort Worth, Texas
Mayor and Council Communication
..
COUNCIL ACTTON: Approved on 4/6/2010 -Ord. No. 19091-04-2010 & 19092=04-2010
DATE Tuesday Apri106 2010
LOG NAME 12CABLE SALE
REFERENCE NO *G-16878
SUBJECT
Adopt Ordinance Terminating Cable Television Franchise with Strategic Cable Technologies L.P and
Consenting to the Sale of Cable System to Charter Communications Authorize Execution of Related
Settlement Agreement and Adopt Appropriation Ordinance
RECOMMENDATION
It is recommended that the City Council
1 Adopt the attached Ordinance terminating the cable television franchise granted to Strategic Cable
Technologies L P (SCT) and consenting to the sale of SCT's cable system to Charter Communications
2. Authorize the City Manager to execute a settlement agreement with SCT pursuant to which both the
City and SCT release one another from all .legal claims regarding the sale of SCT's system to Charter
Communications in return for a payment by SCT to the City of $60 000 00 and
3 Adopt the attached Appropriation Ordinance increasing estimated.receipts and appropriations in the
Cable Communications Section of the Special Trust Fund in the amount of $60 000 00
DISCUSSION
On December 2 2003 the City Council adopted Ordinance No 15790 (M&C G-14166) granting SCT a
franchise (the Franchise) to use public rights-of-way in the City for the operation of a cable television
system SCT serves approximately 1 800 customers in the Sendera Ranch area of north Fort Worth The
Franchise requires SCT to obtain the City's consent prior to any sale or transfer of SCT's cable system to
another party
In December 2009 SCT notified the City that it intended to sell its system to Charter Communications
(Charter) and to terminate the Franchise Charter is authorized to provide cable television services in the
City of Fort Worth under a permit issued by the Texas Public Utility Commission and in accordance with
Chapter 66 of the Texas Utilities Code is not subject to local franchising authority as SCT is: The City is
willing to consent to the termination of the Franchise and the sale of SCT's system to Charter in return for
a payment by SCT of $60 000 00 which City staff believes is reasonable compensation for the loss of
certain regulatory rights under the Franchise that are not available under state law
FISCAL INFORMATION /CERTIFICATION
The Financial Management Services Director certifies that the Community Relations Department is
responsible for the collection and deposit of funds due to the City
FUND CENTERS
Logname 12CABLE SALE Page 1 of 2
TO Fund/Account/Centers FROM Fund/Account/Centers
FE72 481306 002500100000 $60,000.00
CERTIFICATIONS
Submitted for City Manager's Office bv• ALL ACMs (6222)
Originating Department Head David Yett (7623)
Additional Information Contact: Peter Vaky (7601)
Logname 12CABLE SALE Page 2 of 2