HomeMy WebLinkAboutOrdinance 12789ORDINANCE NO "/
AN ORDINANCE AMENDING ORDINANCE NO. 10972, GRANTING
CONSENT TO THE ASSIGNMENT AND TRANSFER OF A CABLE
TELEVISION SYSTEM AND LIMITED FRANCHISE FROM TELECOM
SATELLITE SYSTEMS CORPORATION TO TVMAX
TELECOMMUNICATIONS, INC.; APPROVING AN AGREEMENT OF
ACCEPTANCE OF TERMS AND CONDITIONS TO TRANSFER OF
CABLE TELEVISION SYSTEM AND FRANCHISE BETWEEN THE CITY
OF FORT WORTH AND TVMAX TELECOMMUNICATIONS, INC.;
AMENDING THE LOCATIONS WITHIN THE CITY OF FORT WORTH
IN WHICH TVMAX TELECOMMUNICATIONS, INC. MAY OPERATE A
CABLE TELEVISION SYSTEM; PROVIDING THAT THIS ORDINANCE
IS CUMULATIVE; PROVIDING A SEVERABILITY CLAUSE;
PROVIDING FOR PUBLICATION; AND PROVIDING AN EFFECTIVE
DATE.
WHEREAS, the Crty of Fort Worth (the "City") previously granted a limited franchise for
the operation of a cable television system ("Franchise") to Telecom Satellite Systems Corporation
("Telecom") under Ordinance No 10972 and Telecom accepted the rights and obligations of such
Franchise under City Secretary Contract No 18949 ("Franchise Agreement"), and
WHEREAS, on November 1, 1995, Telecom as seller and TVMAX Telecommunications,
Inc. ("TVMAX") as buyer entered into an Asset Purchase Agreement pursuant to which Telecom
agreed to assign and transfer the Franchise and its cable television system m the City to TVMAX,
and
WHEREAS, Telecom and TVMAX have requested the City to consent to an assignment
and transfer of the Franchise from Telecom to TVMAX pursuant to § 17 of Ordinance No. 10972
and § 17.B(1) of the Franchise Agreement; and
WHEREAS, at the City's request, Telecom and TVMAX have submitted to the City
information and documents relating to the Asset Purchase Agreement between Telecom and
TVMAX and the effect such transaction will have on the provision of cable television service
within the City; and
WHEREAS, the City is relying upon the information and documents submitted by
Telecom and TVMAX m acting upon the request by such parties to assign and transfer the
Franchise to TVMAX, and
WHEREAS, the City, intends to consent to the assignment and transfer, subject to
TVMAX's acceptance of the terms and conditions set forth herein, having determined that such
consent is in the best interest of and consistent with the public necessity and convenience of the
City; and
WHEREAS, TVMAX wishes to operate rts cable television system at a location in the City
of Fort Worth depicted in Exhibit "A" m addition to the locarion provided by the Franchise,
NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY
OF FORT WORTH, TEXAS•
SECTION 1.
The City hereby consents to the transfer and assignment by Telecom to TVMAX of the
Franchise and the cable television system at the locations m the City provided by the Franchise. Tn
addition, the City hereby grants TVMAX a limited franchise to operate a cable television system at
the location in the City shown m Exhibit "A", attached hereto and incorporated herein by reference
for all purposes. This Section 1 is subject to the following:
A. Execution by TVMAX of an Acceptance Agreement in the form attached hereto and
incorporated herein by reference for all purposes as Exhibit "B", and
B. Execution by OpTel, Inc of an Acceptance Agreement m the form attached hereto
and incorporated herein by reference for all purposes as Exhibit "B" under which
Optel unconditionally guarantees TVMAX's performance of the conditions and
obligations of the Franchise and the Acceptance Agreement.
SECTION 2.
To the extent that this ordinance or the attached Acceptance Agreement modifies any of the
terms of Ordinance No 10972 or the Franchise Agreement, such Ordinance and Franchise
Agreement are hereby amended. Except as hereby amended, the provisions of Ordinance No
10972 and the Franchise Agreement shall remain unchanged and in full force and effect.
SECTION 3.
If any provision of this ordinance shall be held by a court of competent jurisdiction to be
invalid, illegal or unenforceable, the valydity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired.
SECTION 4.
The City Secretary of the City of Fort Worth is hereby directed to publish this ordinance m
its entirety once a week for four (4) consecutive weeks within a period of thirty (30) days following
its passage m the official newspaper of the City, as required by Section 2 of Chapter XXV of the
City Charter of the City of Fort Worth, Texas TVMAX shall be responsible for the cost of such
publication.
SECTION 5.
This ordinance shall be in full force and effect from and after its passage, publication and
written acceptance by TVMAX and Optel, Inc. as specified herein, and it is so ordasned.
2
APPROVED AS TO FORM AND LEGALITY
Assistant City A rney
Date. /Z-~ ~96
ADOPTED• /rJ'S ' ~ ~ ~ ~`
EFFECTIVE. ~" ~ /-
EXHIBIT "A"
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EXHIBIT "B "
This AGREEMENT OF ACCEPTANCE OF TERMS AND CONDITIONS TO
TRANSFER OF CABLE TELEVISION SYSTEM AND FRANCHISE AND AMENDMENT
OF ORDINANCE NO. 10972 ("Acceptance Agreement") is made and entered into by and
between the CITY OF FORT WORTH, TEXAS (the "City"), a home rule municipal corporation
situated in Tarrant, Denton and Johnson Counties, Texas acting by and through its duly authorized
Assistant City Manager, and TVMAX TELECOMMUNICATIONS, INC. ("TVMAX"), a
Delaware corporation acting by and through Michael E. Katzenstein, its duly authorized Vice
President and General Counsel.
OpTel, Inc. ("OpTel"), a Delaware corporation, joins this Acceptance Agreement for the
purpose of guaranteeing TVMAX's performance under this Acceptance Agreement, Ordinance No
10972, as amended, and City Secretary Contract No 18949, as amended.
WHEREAS, Telecom Satellite Systems Corporation ("Telecom"), a New Jersey
corporation, possesses a limited franchise to operate and maintain a cable television system in the
City ("Franchise") pursuant to City of Fort Worth Ordinance No 10972, as amended (the
"Ordinance"), and City Secretary Contract No 18949, as amended (the "Franchise Agreement"),
both of which are on file in the City Secretary's Office of the Crty; and
WHEREAS, the Ordinance and the Franchise Agreement provide that Telecom may
transfer its rights and obligations under the Ordinance and the Franchise Agreement to a third party
upon receipt of an application for and upon the consent and approval by the City of a lirruted
franchise to such third party to operate a cable television system in the City; and
WHEREAS, Telecom wishes to transfer its rights and obligations under the Ordinance and
the Franchise Agreement to TVMAX and TVMAX wishes to assume Telecom's Franchise and the
rights and obligations associated with it; and
WHEREAS, TVMAX has filed a completed application for a limited franchise to operate a
cable television system at the locations in the City provided by the Ordinance and at the location in
the City shown in Exhibit "A", attached hereto and incorporated herein by reference for all
purposes,
NOW, THEREFORE, in consideration of the benefits, promises and mutual covenants
contained herein, and for other good and valuable consideration, the City and TVMAX agree as
follows.
1. BINDING NATURE OF AGREEMENT.
The promises, covenants and conditions contained herein inure to the benefit of the City and
are binding on TVMAX.
Exhibit 'B" to Ordinance Amending Ordinance No. 10972
Page 1
2. SUBORDINATION.
TVMAX acknowledges that the transactions described m the Asset Purchase Agreement
dated November 1, 1995, between TVMAX as Buyer and Telecom and Telecom Master, L.P , a
New Jersey limited partnership, as Seller, are expressly subordinate to and will not affect the
binding nature of the Ordinance or the Franchise Agreement and the obligations provided therein,
and that the consent of the City to transfer the Franchise as a result of such Asset Purchase
Agreement does not constitute a waiver or release of any rights of the City TVMAX assumes and
agrees to perform all of the obligations set forth in the Ordinance and the Franchise Agreement,
both of which are incorporated herein by reference for alI purposes and hereby made a part of this
Agreement.
3. RELIANCE UPON REPRESENTATIONS.
TVMAX acknowledges that the City has consented to the transfer of the Franchise in
reliance upon the representations, documents and information provided by TVMAX and Telecom,
all of which are incorporated herein by reference
4. CUSTOMER SERVICE.
A. TVMAX acknowledges that under applicable law the City unilaterally may establish
and enforce reasonable customer service regulations that exceed or are not addressed by the
standards established by the Federal Communications Commission ("FCC") or the
standards currently established by the Ordinance and the Franchise Agreement.
B. TVMAX will provide at a minimum the same quality of customer service that
Telecom has provided m the past, but in all events no less than the quality of service
required by the Ordinance and the Franchise Agreement, any other applicable City
ordinances and all applicable FCC regulations.
C. In the event a cable subscriber registers a complaint with the City, the City may
contact TVMAX's customer service manager TVMAX will at all times provide and keep
current and on file with the City's Cable Communications Office the name of TVMAX's
customer service manager and his or her mailing address and daytime telephone number
TVMAX agrees that rt will cooperate with the Crty and keep the Crty informed as to any
complaint referred to TVMAX by the City In addition, TVMAX agrees to notify the Crty
immediately of any changes m key executives or customer service managers.
D. TVMAX agrees to provide the City's Cable Communications Office with no less
than thirty-five (35) days' prior written notice of TVMAX's intent to change or revise its
service m the City, including, but not limited to, changes in programming or channel
alignment.
5. PRIOR DEFAULTS.
A. TVMAX agrees that it will not contend, directly or indirectly, that any defaults or
failures to comply with the Ordinance or the Franchise Agreement by Telecom prior to the
City's consent to the transfer and assignment of the Franchise, are waived, including, but not
lirruted to, the following:
Exhibit 'B" to Ordinance Amending Ordinance No. 10972
Page 2
(1) The ability of the City to obtain redress for prior defaults, such as, for
example, recovery of any underpayment of franchise fees.
(2) The ability of the City to enforce in the future any portion or portions of the
Ordinance or the Franchise Agreement that may not have been enforced m
the past.
B. Notwithstandmg the provisions of Section S.A hereof, the City agrees that it will not
(i) exercise its right to declare a forfeiture of the Franchise pursuant to Section 18.A(4) of
the Franchise Agreement in the event that Telecom is found by a court of competent
jurisdiction to have practiced any fraud or deceit upon the Crty; (ii) impose on TVMAX a
financial penalty pursuant to Section 18.B(1) of the Franchise Agreement for any contract
violation by Telecom, or (iu) suspend TVMAX's franchise rights pursuant to Section
18.B(2) for any violation by Telecom which TVMAX has initiated reasonable efforts to
correct or remedy as provided m Section 18.D of the Franchise Agreement.
C. Notwithstandmg the provisions of Section S.A hereof, and Section 3.B of the
Franchise Agreement, the City agrees that, m its discretion, rt will exercise no later than
within nine (9) months following the date of execution of this Agreement (or forfeit) its
right to review and audit pursuant to Section 3.B of the Franchise Agreement Telecom's
income records with respect to Telecom's operations prior to the date hereof
6. VALIDITY OF FRANCHISE.
TVMAX accepts and agrees to be bound by the terms and conditions of the City's Charter,
the Ordinance, the Franchise Agreement and all other ordinances applicable to TVMAX's
operations after the City's consent to the transfer and assignment of the Franchise. TVMAX does
not contend that any provision of either the Ordinance or the Franchise Agreement is unlawful or
unenforceable, nor does it contend that any other ordinance or provision of the City's Charter is
unlawful or unenforceable. The City acknowledges that the provisions of both the Ordinance and
the Franchise Agreement are in full force and effect.
7. FRANCHISE REQUIREMENTS.
A. TVMAX will not allow any Telecommunications Entity, as defined herein, other
than TVMAX, t0 use or lease its facilities m the City subject to this Agreement or capacity
thereon, provided, however, that TVMAX may allow an affiliate entity to use or lease such
facilities provided that the City receives written notice not less than thirty (30) days in
advance of such an arrangement.
B. As of the execution date of this Acceptance Agreement, TVMAX specifically
covenants and represents to the City that it does not have any existing agreements with any
Telecommunications Entity regarding m any way the Franchise or facilities subject to this
Agreement. TVMAX further covenants and represents to the Crty that it has exercised due
diligence to ensure that Telecom does not have any such agreements with any
Telecommunications Entity and that, to the best of its knowledge, Telecom does not have
any existing agreements with any Telecommunications Entity other than TVMAX regarding
m any way the Franchise or facilities subject to this Agreement. For purposes of this
Acceptance Agreement, "Telecommunications Entity" shall mean any entity subject to the
Exhibit 'B" to Ordinance Amending Ordinance No. 10972
Page 3
jurisdiction of or regulated by the FCC or the Texas Public Utility Commission, or their
successors, mcludmg, but not hrnited to, telephone, alternative access and cable companies.
TVMAX agrees to provide the City with any and all documents relating to the foregoing as
the City may reasonably request, mcludmg, but not limited to, copies of the agreements
themselves.
C. TVMAX acknowledges that the Ordinance and the Franchise Agreement do not
allow for the provision of Telecommunications Services, as defined herein, and that
TVMAX is not entitled to provide such services within the City or to make its wires
available to others for that purpose until and unless it first applies for and is granted a
franchise for such services from the City For purposes of this Acceptance Agreement,
"Telecommunications Services" shall mean conventional telephone service, including, but
not limited to, switched local exchange service and non-switched services, such as
alternative access service which connects user locations and connects users to long distance
companies.
8. TRANSACTION TRANSPARENT TO RATES.
TVMAX acknowledges that the transfer of the Franchise, the consent process, the City's
action in granting its consent thereof and this Acceptance Agreement do not provide any basis for
an increase in the amounts paid by subscribers to services provided under the Franchise through
cost pass-through as so-called "external costs," as new franchise requirements or in any other
manner
9. GOVERNMENTAL POWERS.
It is understood and agreed that by execution of this Acceptance Agreement, the City does
not waive or .surrender any of its governmental powers.
10. NO WAIVER.
The failure of the Crty to insist upon the performance of any provision of the Ordinance, the
Contract or this Acceptance Agreement, or to exercise any right granted thereby, shall not constitute
a waiver of the City's right to insist upon appropriate performance or to assert any such right on any
future occasion.
11. VENUE.
Should any action, whether real or asserted, at law or in equity, arise out of the terms of this
Acceptance Agreement or the ordinance under which the City has consented to the transfer and
assignment of the Franchise to TVMAX, venue for such action shall lie exclusively in Tarrant
County, Texas or in the United States District Court for the Northern District of Texas, Fort Worth
Division. This Acceptance Agreement, as well as the Ordinance and the Contract, shall be
construed m accordance with the laws of the State of Texas.
Exhibit "B" to Ordinance Amending Ordinance No. 10972
Page 4
12. SEVERABILITY.
If any provision of this Acceptance Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not m any
way be affected or Impaired.
13. ENTIRETY OF AGREEMENT.
This written instrument, including any documents incorporated herein by reference,
contains the entire understanding and agreement between the City and TVMAX, rts assigns and
successors in interest, as to the matters contained herein. Any prior or contemporaneous oral or
written agreement is hereby declared null and void to the extent in conflict with any provisions of
this Acceptance Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Acceptance Agreement
in multiples to become effective upon the filing with and assignment of a contract number by the
City Secretary's Office of the City of Fort Worth, Texas this day of , 1996.
CITY OF FORT WORTH.
By•
Ramon Guaj ardo
Assistant City Manager
ATTEST
By•
City Secretary
APPROVED AS TO FORM AND LEGALITY
Assistant City Attorney
Date.
M&C
TVMAX TELECOMMUNICATIONS, INC.
By•
Michael E. Katzenstein
Vice President and General Counsel
ATTEST
By•
OpTel, Inc. hereby unconditionally guarantees performance of the obligations of TVMAX
under this Acceptance Agreement, the Ordinance, as amended, and the Franchise Agreement, as
Exhibit "B to Ordinance Amending Ordinance No. 10972
Page 5
amended.
OPTEL, INC.
By•
Name
Title.
ATTEST
By.
Exhibit "B" to Ordinance Amending Ordinance No. 10972
Page 6
City of Fort worth, Texas
1~ayor ~c~d Coaincil Communicc~ti®n
DATE
12/03/96 ~ **C-15$03 I 120RD1 I 1 of 2
SUBJECT ORDINANCE AMENDING ORDINANCE NO 10972 BY CONSENTING TO TRANSFER
OF CABLE TELEVISION LIMITED FRANCHISE FROM TELECOM SATELLITE SYSTEMS
CORPORATION TO TVMAX TELECOMMUNICATIONS, INC AND AGREEMENT OF
ACCEPTANCE BETWEEN CITY AND TVMAX TELECOMMUNICATIONS, INC
GOVERNING SUCH TRANSFER
RECOMMENDATION
It is recommended that the City Council
1 Adopt the attached ordinance amending Ordinance No 10972 to provide for the
assignment and transfer of a cable television system and limited franchise from Telecom
Satellite Systems Corporation ("Telecom") to TVMAX Telecommunications, Inc
("TVMAX"), and
2 Authorize the City Manager to execute an Acceptance Agreement between the City and
TVMAX conditioning the City's consent and governing the respective rights of the parties
regarding the transfer
DISCUSSION
On December 10, 1991 the City Council adopted Ordinance No 10972 (the "Ordinance"),
granting Telecom a limited franchise to operate a cable television system in the City of Fort
Worth until December 10, 2001 Pursuant to the Ordinance, the City and Telecom entered into
the City Secretary Contract No 18972 (the "Contract"),which fully incorporated and effectuated
the Ordinance
On November "1, 1995 Telecom and TVMAX executed an Asset Purchase Agreement under
which TVMAX acquired all of Telecom's assets in the State of Texas Telecom is now
requesting the City to consent to a transfer of its limited franchise to TVMAX based upon
Section 17 of the Ordinance and the Contract, which allows for such a transfer
City staff and TVMAX have negotiated an Acceptance Agreement that establishes certain terms
and conditions for the transfer from Telecom to TVMAX Under this Agreement, TVMAX has
agreed, among ot'r,er things, to provide certain customer service levels, to honor any defaults that
Telecom may have committed, including payment of past due franchise fees, and to not pass on
to subscribers any of its costs arising either from the transfer or under the Asset Purchase
Agreement Furthermore, TVMAX's parent company, Optel, inc has agreed to guarantee
TVMAX's performance under the Ordinance, the Contract, the attached ordinance and the
Acceptance Agreement
Pri^ted o~ Re.yGed Pate:
City of Fort Worth Texas
ltdayor and Councal Communication
DATE
12/03/96 REFERENCE NUMBER
**C-15803 LOG NAME
120RD1 PAGE
2 of 2
SUBJECT ORDINANCE AMENDING ORDINANCE NO 10972 BY CONSENTING TO TRANSFER
OF CABLE TELEVISION LIMITED FRANCHISE FROM TELECOM SATELLITE SYSTEMS
CORPORATION TO TVMAX TELECOMMUNICATIONS, INC AND AGREEMENT OF
ACCEPTANCE BETWEEN CITY AND TVMAX TELECOMMUNICATIONS, INC
GOVERNING SUCH TRANSFER
The attached ordinance formally gives the City's consent to the transfer and assignment of
Telecom's franchise and cable television system to TVMAX The City's consent is subject to the
execution by TVMAX and Optel, Inc of the Acceptance Agreement
FISCAL INFORMATION/CERTIFICATION
The Director of Fiscal Services certifies that this action will have no material effect on City
Funds
CB m
Submitted for City Manager's FUNK ACCOUNT CENTER AMOUNT CITY SECRETARY
Office by: (to)
Charles Boswell 8511 ~~~~
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Pete Vaky 7601 (front) Pj~lw ~ t-,;~
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