Loading...
2010-54 /1 - RECEIVE aT NATURAL GAS DISTRIBUTION FRANCHISE AGREEMENT THIS NATURAL GAS DISTRIBUTION FRANCHISE AGI2,FEMENT (hereinafter the "Franchise Agreement ") is made and entered into this JQ day of ( G4obe 2010, by and between the CITY OF CLERMONT, a Florida municipal corporation, (hereinafter referred to as "City "), and the LAKE APOPKA NATURAL GAS DISTRICT, an independent special district organized and existing under the laws of the State of Florida, (hereinafter referred to as the "Franchisee "), for the purposes of granting a non - exclusive franchise for the right, privilege or franchise to manufacture, import, transport, distribute and sell manufactured or natural gas within the City, or the portion thereof hereinafter described, all subject to the terms and conditions set forth herein. Section 1: Grant of Non - Exclusive Franchise. in consideration of the agreement of the Franchisee to (i) pay to the City the franchise fee set forth in Section 8 hereof, and (ii) otherwise comply with the terns and conditions of this Franchise Agreement, the City does hereby grant to Franchisee, for a period of ten (10) years from the date of this Franchise Agreement, the non - exclusive right, privilege and franchise to manufacture, import, transport, distribute, and sell manufactured or natural gas (hereinafter referred to generally as "Gas ") within the boundaries of the City as the same now exist or may hereafter be extended or contracted (hereinafter referred to as "Franchise Area ") and for that purpose to establish the necessary facilities and equipment and to maintain a manufacturing plant, gas mains, service pipes, and other appurtenances necessary to the manufacture, sale, transportation, and distribution of Gas in, under, upon, across, and along the present and future streets, alleys, avenues, bridges, easements, or other public places or ways of the City within the Franchise Area, and to do all things which are reasonable, necessary, or customary in the accomplishment of this objective; subject, however, to the further provisions of this Franchise Agreement. Notwithstanding the foregoing, before Franchisee shall establish any plant in the City for the manufacture of gas, the Franchisee shall first obtain the approval of the City as to the location thereof and shall comply with all applicable statutes, laws, ordinances, rules, and regulations. No such plant shall be constructed or operated in violation of the zoning and building ordinances of the City. Section 2: Obstructing Streets. The Franchisee shall exercise its privileges herein subject at all times to the police power of the City and shall not unnecessarily or unreasonably obstruct the use of, or injure, any street, avenue, alley, or other public place in any way, and shall, upon completion of any construction or repair, restore all streets, avenues, alleys, or other public places or ways of the City which shall be opened by it or its agents or employees for the purpose of laying, placing, or repairing its gas mains or service pipes to as nearly the same order and condition as they were before the excavation was made as is reasonably possible and to preserve them in this condition for twelve 1 months. Any obstruction of any street, avenue, alley, or other public place or way or any failure to properly fill and maintain a street, avenue, alley, or other public place after excavation, after proper notice of ten days from the City to Franchisee demanding removal or repair, may be taken care of by the City and the costs thereof, plus ten percent for administering and engineering expense, shall be charged against the Franchisee. Except in cases of emergency, Franchisee shall give the City three days notice prior to conducting any excavation or work within any public right of way. Section 3: Plats. Prior to the laying or relaying of any gas mains pursuant to this Franchise Agreement, the Franchisee shall present to the City a complete plat showing the location and size of all proposed mains. The construction, location, or relocation of all facilities or any other construction or installation made and effected by the Franchisee by virtue of this Franchise Agreement shall be made under the supervision of, and with the approval of, such representatives as the City may designate for such purpose, but not so as to unreasonably interfere with the proper operation of the Franchisee's facilities and service. Section 4: Indemnification. Franchisee shall indemnify, defend, and hold completely harmless the City and its elected representatives, officers, employees, and agents, to the extent provided by Section 768.28, Florida Statutes, from and against any and all liabilities, losses, suits, claims, demands, judgments, fines, damages, costs, and expenses (including, but not limited to, all costs for investigation and defense thereof, court costs, expert fees, reasonable attorney fees and paralegal fees, and reasonable attorney fees and paralegal fees on appeal) which may be incurred by, charged to, or recovered from any of the foregoing: (i) by reason or on account of damage to or destruction of any property of the City, or any property of, injury to, or death of any person resulting from or arising out of the performance under this Franchise Agreement, or the acts or omissions of Franchisee's officers, agents, employees, subcontractors, licensees, or invitees regardless of where the damage, destruction, injury, or death occurred unless such liability, loss, suit, claim, demand, judgment, fine, damage, cost, or expense was proximately caused solely by the City's negligence or by the joint negligence of the City and any person other than the Franchisee or Franchisee's officers, agents, employees, subcontractors, licensees, invitees, or (ii) arising out of the failure of Franchisee to keep, observe, or perform any of the covenants or agreements herein to be kept, observed, or performed by Franchisee, or (iii) by reason or on account of death, injury, or damage to persons or property arising out of the construction, maintenance, repair, or operation of Franchisee's property or due to the negligence of the Franchisee or its agents or employees in operating its property. City agrees to give Franchisee reasonable notice of any suit or claim for which indemnification will be sought hereunder, to allow Franchisee or its insurer to compromise and defend the same to the extent of its interests and to reasonably cooperate with the defense of any such suit or claim. The provisions of this Section shall survive the expiration or earlier 2 termination of the term of this Franchise Agreement with respect to any acts or omissions occurring during the term of the Franchise Agreement. Nothing herein shall be construed to serve as a waiver of any sovereign immunity that Franchisee shall enjoy as a matter of law. Section 5: insurance. (A) Franchisee shall, without expense to the City, obtain and maintain throughout the term of this Franchise Agreement: (i) Comprehensive automobile insurance covering any motor vehicle operated by or on behalf of the Franchisee including owned autos, non -owncd autos and hired autos; and (ii) Comprehensive general liability insurance (including but not limited to contractual, independent contractors, broad form property damage, and personal injury, as applicable, and such other coverage as may from time to time be generally issued by insurance companies for businesses similar to that engaged in by the Franchisee in the performance of this Franchise Agreement which the City may reasonably require) protecting Franchisee, the City, and the City's elected representatives, members of the Commission, officers, agents, and employees from and against any and all liabilities arising out of or relating to Franchisee's performance of this Franchise Agreement whether such operations be by itself or by any subcontractor or by anyone directly or indirectly employed by any of them or by anyone for whose acts any of them may be liable; and (iii) Workers compensation or similar insurance affording the required statutory coverage and limits. (B) Such policies shall be with a company or companies which have and maintain a rating of B +, or better, as published in Ratings & Analysis by A. M. BEST COMPANY, INC. of Ambest Road, Oldwick, New Jersey, 08858, (http: / /www.ambest.com) and (except for the coverage limits of Workmen's Compensation insurance) shall be in an amount no less than ONE MILLION AND NO /100 DOLLARS, combined single limit, or its equivalent, or such greater amount of such insurance as shall be maintained by Franchisee, with no deductible, with cross liability endorsement and with contractual liability coverage for Franchisee's covenants to and indemnification of the City. Franchisee's insurance shall provide that it is primary insurance as respects any other valid and collectible insurance City may possess, including any.self- insured retention or deductible City may have, and that any other insurance City does possess shall be considered excess insurance only. Franchisee's insurance shall also provide that it shall act for each insured and each additional insured as though a separate policy has been written for each; provided, however, that this provision shall not operate to increase the policy limits. (C) Franchisee shall provide, prior to the effective date of this Franchise Agreement, and at least thirty days prior to the expiration of an insurance policy or policies theretofore provided to the City by Franchisee hereunder, a certificate of insurance evidencing all coverage required under this Section. Such certificate(s) shall name the City and its elected representatives, officers, employees, and agents as additional insureds and shall provide that the policy or policies may not be canceled or modified nor the limits thereunder decreased without thirty days' prior written notice thereof to the City. Franchisee agrees that the City shall have the right, exercisable on ninety days' prior written notice to Franchisee, to require Franchisee, from time to 3 time, reasonably to alter the monetary limits or coverage provided by such policy or policies. Section 6: Standards of Service. (A) The Franchisee shall at all times furnish a safe and reliable supply of Gas to its customers within the City; subject, however, to the further provisions of this section. The Franchisee will sell and distribute Gas through its distribution system which is located in Orange and Lake Counties and in a number of cities and towns located therein and in the territory adjacent to and near said cities and towns. The Gas distributed by the Franchisee will be transported to Franchisee by the pipeline system owned and operated by Florida Gas Transmission Company, (or by some other company which holds a certificate of public convenience and necessity from the Federal Energy Regulatory Commission to transport Gas in the State of Florida). That company is a "Natural Gas Company" under the Federal Natural Gas Act, which subjects said Florida Gas Transmission Company (or its successors or assigns) to the jurisdiction of the Federal Energy Regulatory Commission. (B). Any expansion of the system subject to this Franchise will be determined by the Franchisee in accordance with the terms and conditions of its Tariff pertaining to system expansion. The Franchisee, by entering into this Franchise Agreement, makes no representation or assurance, and assumes no obligation beyond the terms of its Tariff, that it will expand the distribution system beyond what currently exist. (C) The Franchisee shall not be liable to the City or its inhabitants by reason of the failure of the Franchisee to deliver Gas as a result of force majeure, or failure, inability or refusal of the pipeline supplier to transport an adequate supply, or an order or decision of a public regulatory body, or other acts beyond the control of the Franchisee. The Franchisee shall have the right and authority, and it shall be its duty, to adopt reasonable rules and regulations in connection with the limiting, curtailing or allocating service or supplying Gas to any customer or prospective customer, and withholding the supply of Gas to new customers, whenever any of the occurrences named in the foregoing sentence take place; provided, however, that such rules and regulations shall be uniform as applied to each class of customers, and shall be non- discriminatory as between communities receiving natural gas service from the Franchisee. (D) Subject to the limitations contained in the foregoing subparagraphs A, B, and C, the Franchisee shall make gas sales service available to customers within the Franchise Area pursuant to a Tariff which shall be uniform as to each class of service customer; provided, however, the Tariff shall be determined by the Board of Directors of the Franchisee and may classify its Gas services in any manner allowed by law. (E) The rates charged by the Franchisee for its Gas and Gas services furnished within the City shall be in accordance with the Tariff determined by the Board of Commissioners of the Franchisee which shall be uniform as applied to each class of customers, and shall be non- discriminatory as between communities receiving natural gas service from the Franchisee. (F) The quality of the Gas sold in the City shall be the same as that sold to the Franchisee's other customers in its service area in the counties in which the Franchisee operates. 4 (G) If service is suspended because of any of the reasons set forth above, occurring through no fault or negligent act on the part of the Franchisee, such suspension shall not be made the basis of any action or proceeding to terminate this Franchise. Section 7: Accounting Reports. (A) Franchisee agrees to file with the City Clerk, on or before April 1 of each year, a copy of its annual audit report for the preceding fiscal year of the Franchisee, together with an income statement for the City, on an allocated basis. (B) The City or any certified public accountant selected by the City, shall have the right at all reasonable hours to examine the Franchisee's books and records for the purpose of verifying the statement of revenues furnished by the Franchisee to the City. In the event City elects to have said books and records reviewed by an accountant, the City shall bear the cost of the services of such accountant, unless the audit discloses that the accountings rendered by the Franchisee reported less than ninety percent of the moneys due to the City, in which case the audit costs shall be paid by the Franchisee. The Franchisee's books and records shall be kept in accordance with good business procedures and generally- accepted accounting principles and shall be in such form that they shall contain all information reasonably necessary to the City. (C) The City shall promptly furnish Franchisee accurate information regarding any expansion, contraction or other modification of the corporate boundaries of the City and Franchisee shall be entitled to rely on information so furnished in order to identify customers and accounts within the corporate limits of the City. Section 8. Payments to the City. The Franchisee agrees that subsequent to the commencement date of this Franchise Agreement, it will, in consideration of the granting of this franchise, pay to the City, at least quarterly, out of revenues derived from the sale of Gas to customers of its gas system or systems, such sums of money as shall be allocated to the City by virtue of the computation made pursuant to the following formula (sometimes referred to as "the Franchise Fee "): (A) All rates, fees, rentals, or other charges or income derived by the Franchisee from the operation of its gas system or systems shall first be used by the Franchisee to pay all costs of operation and maintenance of such gas system or systems, to pay the principal of and interest on any revenue bond or other obligation issued by the Franchisee to finance the cost of construction, extension, expansion, improvement, or acquisition of gas systems, to establish appropriate reserves for any such revenue bonds, to establish an extension, removal, and replacement fund for such gas system or systems, and to make all other proceedings authorizing any such revenue bonds. The payments to the City by the Franchisee as set forth in Section 8(B) of this Franchisee Agreement are hereby construed to be a part of the operation cost and maintenance of the gas system or systems, and shall be paid to the City as an expense falling in that category and liable for payment by the Franchisee as such. 5 • (B) The Franchisee shall pay to the City a sum representing six percent of the gross revenues derived from the sale of Gas to all customers within the corporate limits of the City during the year in which such payment is due, after deduction therefrom the gross revenues derived from sale of Gas to interruptible gas customers and from furnishing transportation services to customers within the corporate limits of said City. The phrase "Gross Revenues" shall be deemed to include a flat -rate customer charge or a minimum bill charge, if any, made by the Franchisee regardless of the amount of Gas consumed. (C) If at any time during the term of this Franchise Agreement, the Franchisee and another governmental authority shall enter into a similar franchise which provides for a more favorable franchise fee to be paid by the Franchisee than that provided for in this Franchise, the Franchisee shall so notify the City in writing immediately thereafter and shall extend a similar fee agreement to the City and, at the City's option, this Franchise will be deemed amended to incorporate such more favorable franchise fee. Section 9: Preliminary Engineering Plans. Upon request of the City, the Franchisee shall review the preliminary engineering plans for all commercial developments within the City and provide the City in a timely manner with written comments concerning the providing of gas to such development. Section 10: Approval of Transfer. No sale, assignment, or lease of this Franchise Agreement or franchise shall be effective until it is approved by the City, and until the vendee, assignee, or lessee, has filed in the office of the City Clerk an instrument duly executed reciting the facts of such a sale, assignment, or lease, accepting the terms of the Franchise, and agreeing to perform all of the conditions thereof. The City may require that any proposed assignee submit similar documentation to that provided by the Franchisee at the time of award of the Franchise. Section 11: Default and Termination. (A) In the event that: (i) the Franchisee shall fail to keep, perform, and observe each and every promise, covenant, and agreement set forth in this Franchise Agreement, and such failure shall continue for a period of more than sixty days after delivery to the Franchisee of a written notice of such breach or default; or (ii) the Franchisee shall become insolvent, or shall take the benefit of any present or future insolvency statute, or shall make a general assignment for the benefit of creditors, or file a voluntary petition in bankruptcy or a petition or answer seeking an arrangement for its reorganization, or the readjustment of its indebtedness under the Federal Bankruptcy laws, or under any other law or statute of the United States or any State thereof, or shall consent to the appointment of a receiver or trustee or liquidation of all or substantially all of its property; or 6 (iii) the Franchisee shall have a petition under any part of the Federal Bankruptcy laws, or an action under any present or future insolvency laws or statute, filed against it, which petition is not dismissed within thirty days after the filing thereof; then in any of such events, the City, in its discretion, shall have the right to: (i) seek specific performance of this Franchise Agreement, (ii) terminate this Franchise Agreement for default, which termination shall be effective twenty -four hours after written notice of such termination is given to the Franchisee, or (iii) pursue such other actions and remedies as may be permitted by law. In the event the City elects to terminate this Franchise Agreement, then the City may, at its option, delay the effective date of termination for default until the first day of the month following the date on which written notice of such termination is given to the Franchisee. The City shall specify the termination date on the written notice of termination. (B) In the event that a dispute arises between the City and the Franchisee, or any interested party, in any way relating to this Franchise Agreement, the Franchisee shall continue to render service in full compliance with all terms and conditions of this Franchise Agreement regardless of the nature of the dispute. Section 12: Pledge of Revenues Authorized. The Franchisee shall have the right and power, and is hereby authorized to, hypothecate or pledge the rates, fees, rentals, or other charges or income derived by it from users of the services and facilities of its gas system or systems operated by the Franchisee wholly or partially within the City, pursuant to this Franchise Agreement, to the payment of the principal of and interest on any revenue bonds or other obligations hereafter issued by the Franchisee to finance the costs of construction, acquisition, or extension of its gas system or systems within the Counties of Orange and Lake, known as the Lake Apopka Natural Gas District, and appropriate reserves therefor. It is the express intention hereof that this Franchise is made for the benefit of the City, the Franchisee, and the holders of any such revenue bonds or other obligations of the Franchisee, and shall be binding upon and inure to the benefit of, and be enforceable by, the holders of any such revenue bonds or other obligations of the Franchisee, the City and the Franchisee, and the successors and assigns of the City and Franchisee, and except for the holders of any such revenue bonds or other obligations of the Franchisee, the City and Franchisee, and their successors and assigns, is not intended to and shall not confer any rights upon any other person, firm, or corporation, public or private. Section 13: Change of Government. Any change in the form of government of the City as authorized by the State of Florida shall not affect the validity of this franchise. Any municipal corporation succeeding the City shall, without the consent of the Franchisee, succeed to all the rights and obligation of the City provided in this Franchise Agreement. 7 Section 14: Attorneys' Fees. In the event that either party finds it necessary to commence an action against the other party to enforce any provision of this Franchise Agreement, or because of a breach by the other party of any of the terms hereof, each party shall bear its own attorney's fees, paralegal fees and costs in connection therewith. Section 15: Notices. All notices and approvals which any party shall be requested or shall desire to make or give under this Franchise Agreement shall be in writing, and shall be made or given (i) by certified mail, postage prepaid, return receipt required, (ii) by hand delivery to named individuals representing the party to be notified, or (iii) by private parcel (next day) delivery service. Notices, including notice of a change of address or phone number, shall be addressed or transmitted to the addressees as set forth below, or that address which party may otherwise designate in the manner prescribed herein: As to the City: City of Clermont 685 West Montrose Street Clermont, Florida 32711 Attn: City Manager As to Franchisee: Lake Apopka Natural Gas District 1320 S. Winter Garden - Vineland Road (CR535) P.O. Box 771275 Winter Garden, FL 34777 -1275 Attn: General Manager Notices and approvals given or made as aforesaid shall be deemed to have been given and received on the date of actual receipt. Section 16: Miscellaneous. (A) Time is of the essence with respect to all matters set forth in this Franchise Agreement. (B) The Franchisee is not, and shall not for any purpose be, the agent of the City, and shall have no power or authority to bind the City in any manner whatsoever. (C) This Franchise Agreement embodies and constitutes the entire understandings of the 8 parties with respect to the matters contemplated herein, and all prior or contemporaneous agreements, understandings, or representations and statements, oral or written, are merged into this Franchise Agreement. Neither this Franchise Agreement nor any provisions hereof may be waived, modified, amended, discharged, or terminated, except by an instrument in writing signed by the party against whom the enforcement of such waiver, modification, amendment, discharge, or termination is sought, and then only to the extent set forth in such instrument. (D) It is stipulated and agreed between the parties that this Franchise Agreement shall be interpreted and construed in accordance with the laws of the State of Florida, and any trial or other proceeding with respect to this Franchise Agreement shall take place in the State of Florida. (E) Captions of the sections and subsections of this Franchise Agreement are for convenience and reference only, and the words contained therein shall in no way be held to explain, modify, amplify, or aid in the interpretation, construction, or meaning of the provisions of this Franchise Agreement. (F) The Franchisee agrees to promptly reimburse the City for all of its costs and expenses, including attorney's fees and advertising costs, incurred in connection with the negotiation, preparation and award of this Franchise. (G) The City is entering into this Franchise Agreement pursuant to the authority vested in the City Commission by Article VIII of the Constitution of the State of Florida, Chapter 166 of the Florida Statutes, and its Charter. (H) The City hereby represents that this Franchise Agreement has been approved in accordance with all legal requirements. Section 17: Severabilitv. If any part, section, subsection, or other portion of this Franchise Agreement, except for the provisions of Section 8 hereof is declared void, unconstitutional, or invalid for any reason, such part, section, subsection, or other portion, or the prescribed application thereof, shall be severable, and the remaining provisions of this Franchise Agreement, in all applications thereof not having been declared void, unconstitutional, or invalid shall remain in full force and effect. The City and Franchisee declare that no invalid or prescribed provision or application was an inducement at the execution of this Franchise Agreement, and that they would have executed this Franchise Agreement, regardless of the invalid or prescribed provision or application. In the event any part, subsection, or other portion of Section 8 hereof is declared void, unconstitutional, or invalid for any reason, then either party may terminate this Franchise Agreement upon notice to the other party. 9 • IN WITNESS WHEREOF, the CITY OF CLERMONT, FLORIDA, and the LAKE APOPKA NATURAL GAS DISTRICT have caused this Franchise Agreement to be executed as of the day and year first above written. Signed, sealed, and delivered CITY OF CLERMONT, in the presence e ofs a Florida municipal corporation y a 1 /2 /✓ e it's 4 ----- Mayor ,. i As to City ATTEST: �/ / // na_ By: City Clerk (Seal) LAK AT • PKA NATURAL GAS DISTRICT B • / y: 7/ Ann -Dnpee, Vice - President John H. Land, Vice - President As to Franchisee Attest: 671 ti-- <-- Alonzo Williams, Secretary • . _. (Seal). G:\ DOGS \WP \\VIP \CJB \tang franchise clermont REVISED PER CITY ATTY 092010.wpd - d' 4 S rr 1 • 10