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HomeMy WebLinkAboutOrd 763-2017 Atmos Franchise AgreementORDINANCE NO: '/ 3 —oSiJ! AN ORDINANCE GRANTING TO ATMOS ENERGY CORPORATION, A TEXAS AND VIRGINIA CORPORATION, ITS SUCCESSORS AND ASSIGNS, A FRANCHISE TO CONSTRUCT, MAINTAIN, AND OPERATE PIPELINES AND EQUIPMENT IN THE CITY OF ANNA, COLLIN COUNTY, TEXAS, FOR THE TRANSPORTATION, DELIVERY, SALE, AND DISTRIBUTION OF GAS IN, OUT OF, AND THROUGH SAID CITY FOR ALL PURPOSES; PROVIDING FOR THE PAYMENT OF A FEE OR CHARGE FOR THE USE OF THE PUBLIC RIGHTS -OF -WAYS; AND PROVIDING THAT SUCH FEE SHALL BE IN LIEU OF OTHER FEES AND CHARGES, EXCEPTING AD VALOREM TAXES; PROVIDING FOR A TERM AND 'EFFECTIVE DATE; PROVIDING FOR WRITTEN ACCEPTANCE OF THIS FRANCHISE; PROVIDING THAT THE MEETING AT WHICH THIS ORDINANCE IS PASSED IS OPEN TO THE PUBLIC; PROVIDING FOR SEVERABILITY; AND ORDAINING OTHER PROVISIONS RELATED TO THE SUBJECT MATTER HEREOF. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ANNA, TEXAS: SECTION 1. GRANT OF AUTHORITY. A. The City of Anna, Texas, hereinafter called "City," hereby grants to Atmos Energy Corporation, Mid -Tex Division, hereinafter called "Atmos Energy" or "Company," its successors and assigns, consent to use and occupy the present and future streets, alleys, highways, public utility easements, public ways and other public places ("Public Rights -of -Way"), for the purpose of laying, maintaining, constructing, protecting, operating, and replacing therein and thereon pipelines and all other appurtenant equipment (the "System") to deliver, transport, and distribute gas in, out of, and through City for persons, firms, and corporations, including all the general public, and to sell gas to persons, firms, and corporations, including all the general public, within the City corporate limits, as such limits may be amended from time to time during the term of this Franchise. B. Said consent being granted for a term ending December 31, 2027. Unless written notice of its intent to renegotiate is provided by either the City or Atmos Energy at least 180 days prior to the expiration of any term, the Franchise shall be extended for up to two (2) additional terms of five (5) years each on the same terms and conditions as set forth herein. C. The provisions set forth in this Ordinance represent the terms and conditions under which Atmos Energy shall construct, operate, and maintain the System within City, hereinafter sometimes referred to as the "Franchise." In granting this Franchise, City does not in any manner Page r surrender or waive its regulatory or other rights, powers and immunities under and by virtue of the Constitution and statutes of the State of Texas as the same may be amended, nor any of its rights and powers under or by virtue of present or future ordinances of City, including but not limited to generally applicable ordinances regulating the use of Public Rights -of -Way. Company, by its acceptance of this Franchise, agrees that all such lawful regulatory powers and rights as the same may be from time to time vested in City shall be in full force and effect and subject to the exercise thereof by City at any time. SECTION 2. DEFINITIONS. For the purposes of this Ordinance, the following terms, phrases, words, and their derivations shall have the meanings given herein. When not inconsistent with the context, words in the present tense include the future, words in the plural number include the singular number, and words in the singular number include the plural number. The word "shall" is always mandatory and not merely directory. a. "Affiliate" shall mean in relation to Company, a Person that controls, is controlled by, or is under common control with Company. As used in this definition, the term "control" means, with respect to a Person that is a corporation, the ownership, directly or indirectly, of more than 50% of the voting securities of such Person or, with respect to a Person that is not a corporation, the power to direct the management or policies of such Person, whether by operation of law, by contract, or otherwise. b. "City" shall mean the City of Anna, Texas. C. "Company" shall mean Atmos Energy Corporation, Mid -Tex Division, its successors and assigns, but does not include an Affiliate, which shall have no right or privilege granted hereunder except through succession or assignment in accordance with Section 15. d. "Gross Revenues" shall mean: (1) all revenues received, by Company from the sale of gas to all classes of customers (excluding gas sold to another gas utility in the City for resale to its customers within City) within the City; (2) all revenues received by Company from the transportation of gas through the System of Company within the City to customers located within the City (excluding any gas transported to another gas utility in City for resale to its customers within City); Page 2 (3) the value of gas transported by Company for Transport Customers through the System of Company within the City ("Third Party Sales") (excluding the value of any gas transported to another gas utility in City for resale to its customers within City), with the value of such gas to be established by utilizing Company's monthly Weighted Average Cost of Gas charged to industrial customers in the Mid -Tex division, as reasonably near the time as the transportation service is performed; and (4) "Gross Revenues" shall also include fees paid pursuant to this agreement, revenues billed but not ultimately collected or received by Company, and the following "miscellaneous charges": charges to connect, disconnect, or reconnect gas, contributions in aid of construction, charges to handle returned checks from consumers within the City, and State gross receipts fees. "Miscellaneous charges" may include certain other service charges that have, from time to time, been authorized in the rates and charges on file with the City. Any such service charge not already described in this Section 2.d.(4) will be included in the definition of Gross Revenues upon the mutual agreement of City and Company. (5) "Gross Revenues" shall not include: (A) the revenue of any Affiliate or subsidiary of Company; (B) sales tax paid to the City; (C) interest or investment income earned by Company; and (D) monies received from the lease or sale of real or personal property, provided, however, that this exclusion does not apply to the lease of System Facilities within the Public Right -of -Way. e. "Person" shall mean any natural person, or any association, firm, partnership, joint venture, corporation, or other legally recognized entity, whether for-profit or not-for-profit, but shall not, unless the context clearly intends otherwise, include City or any employee, agent, servant, representative or official of City. f. "Public Right -of -Way" shall mean public streets, alleys, highways, bridges, public easements, public places, public thoroughfares, grounds, and sidewalks of City, as they now exist or may be hereafter constructed, opened, laid out, or extended within the present limits of City, or in such territory as may hereafter be added to, consolidated, or annexed to City. Page 3 g. "System" or "System Facilities" shall mean all of Company's pipes, pipelines, gas mains, laterals, feeders, regulators, meters, fixtures, connections, and all other appurtenant equipment used in or incident to providing delivery, transportation, distribution, supply and sales of natural gas for heating, lighting, and power, located in the Public Right -of -Way within the corporate limits of the City. h. "Transport Customer" shall mean any Person for which Company transports gas through the System of Company within the Public Right -of -Way for delivery within the City (excluding other gas utilities in City who resell gas to their customers within City). SECTION 3. CONSTRUCTION MAINTENANCE OPERATION & RELOCATION OF COMPANY SYSTEM FACILITIES. A. All construction, reconstruction, expansion, repairs, excavation, or other work performed by Company, and all of Company's System installed in Public Right -of -Way, shall be in accordance with all generally applicable City Codes and Ordinances not in conflict with this Franchise, including applicable building codes, City standard construction details applicable to the construction of public improvements, management of public right of way ordinance, subdivision ordinance, tree preservation ordinance, and the zoning ordinance, as may be hereafter adopted or amended. Company shall be responsible for all repairs and maintenance resulting from any defects, impairments, or other substandard conditions of City property, including any disturbed, damaged or destroyed landscaping material, caused by the construction, maintenance, expansion, reconstruction, operation or use of City property by Company. B. Upon request of the City, Company shall remove and abate any portion of the System that is dangerous to life or property in accordance with any applicable law. Company shall operate and maintain its System and its related Facilities in material compliance with applicable federal, state, and local laws governing natural gas facilities. C. Company or contractors working on behalf of Company shall be required to obtain permits for construction in Public Rights -of -Way as provided in City ordinances, but shall not be required to pay the City's permit fees. D. The City reserves the right to lay, and permit to be laid, any City -owned facilities, such as storinwater, sewer, gas, water, wastewater and other pipe lines, cable, and conduits, or other improvements and to do and permit to be done any underground or overhead work that may be necessary or proper in, across, along, over, or under Public Rights -of -Way occupied by Page 4 Company. The City also reserves the right to change in any manner any City -owned curb, sidewalk, highway, alley, public way, street, and City -owned utility lines, storm sewers, drainage basins, drainage ditches, and other City facilities. If City damages Company's Facilities while doing work on City facilities, Company shall repair any such damage at City's expense. Likewise, if Company damages any City facilities while doing work on Company Facilities, City shall repair any such damage at Company's expense. E. When Company is required by City to remove or relocate its mains, laterals, and other facilities lying within Public Rights -of -Way to accommodate a request by City, and costs of utility removals or relocations are eligible under federal, state, county, local, or other programs for reimbursement of costs and expenses incurred by Company as a result of such removal or relocation, and such reimbursement is required to be handled through City, Company costs and expenses shall be included in any application by City for reimbursement if Company submits its cost and expense documentation to City prior to the filing of the application. City shall make all reasonable efforts to provide reasonable written notice to Company of the deadline for Company to submit documentation of the costs and expenses of such relocation to City in order for City to be able to submit its application for reimbursement to such program in a timely manner. Upon receipt of an amount of reimbursement intended for utility relocation including, but not limited to, gas utilities, City shall remit to Company, within sixty (60) days of receipt, the portion of reimbursement related to the relocation or removal of Company's facilities. If Company is required by City to remove or relocate its mains, laterals, or other System Facilities lying within Public Rights -of -Way to accommodate a private developer or for projects whose primary purpose is beautification or for any reason other than the construction, reconstruction, improving, widening, or straightening of its Public Right -of -Way, sewers, drainage, water lines, or other utilities by City, Company shall be entitled to reimbursement from City or others of the cost and expense of such removal or relocation. F. When Atmos Energy is required to remove or relocate its mains, laterals or other System Facilities to accommodate construction by City without reimbursement from City, Atmos Energy shall have the right to seek recovery of relocation costs as provided for in applicable state and/or federal law. Nothing herein shall be construed to limit the City's right to require Company to relocate its System Facilities, at Company's expense, to permit the construction, maintenance, modification, or alteration of a municipal facility. Nothing herein shall be construed to prohibit, Page alter, or modify in any way the right of Atmos Energy to seek or recover a surcharge from customers for the cost of relocation pursuant to applicable state and/or federal law, nor shall anything herein be construed to waive City's rights or obligations under state and/or federal law to review and approve or deny such surcharge request. Notwithstanding the foregoing, in cases where the Company is seeking to implement a surcharge to recover unreimbursed costs of relocations required by City, City shall not contest the necessity of the relocation, nor shall it demand documentation of Company's reasonable efforts to receive reimbursement for relocations required by City. City shall not oppose recovery of reasonable relocation costs when Company is required by City to perform relocation. Notwithstanding the foregoing, the City shall have the right to request other project documentation to the full extent provided by state law. G. If City abandons any portion of the Public Rights -of -Way in which Atmos Energy has System Facilities, for public safety reasons or in furtherance of a public project, City shall determine whether it is appropriate to retain a public utility easement in such Public Right -of -Way for use by Company. If City determines, in its sole discretion, that the continued use of the Public Right -of -Way by Company is compatible with the abandonment of the Public Right -of -Way, then in consideration of the compensation set forth in Section 11, and to the maximum extent of its right to do so, City shall grant Company an easement for such use, and the abandonment of the Public Right -of -Way shall be subject to the right and continued use of Company. If City determines, in its sole reasonable discretion, that it is not appropriate to retain a public utility easement in such Public Right -of -Way, Company shall be responsible, subject to the provisions of Section 3, for relocating its System from such Public Right -of -Way, as directed by City. If Public Right -of -Way is sold, conveyed, abandoned, or surrendered by City to a third party, such action shall be conditioned upon Company's right to maintain use of the former Public Right -of -Way. If the third party requests Company to relocate its System from the former Public Right -of -Way, and if such relocation is agreed to by Company, such relocation shall be at the expense of the party requesting same. In addition, in the event of a third party requesting the relocation, if the relocation cannot practically be made to another Public Right -of -Way, the expense of any right-of-way acquisition shall be considered a relocation expense to be reimbursed by the party requesting the relocation. Page 6 SECTION 4. LIABILITY INSURANCE. Company shall, at its sole cost and expense, obtain, maintain, or cause to be maintained, and provide, throughout the term of this Franchise, insurance in the amounts, types and coverages in accordance with the following requirements. Such insurance may be in the form of self- insurance to the extent permitted by applicable law or by obtaining insurance, as follows: A. Commercial general or excess liability on an occurrence or claims made form with minimum limits of five million dollars ($5,000,000) per occurrence and ten million dollars ($10,000,000) aggregate. This coverage shall include the following: (1) Products/completed operations to be maintained for a warranty period of 2 years, (2) Personal and advertising injury, (3) Contractual liability, and (4) Explosion, collapse, or underground (XCU) hazards. B. Automobile liability coverage with a minimum policy limit of one million dollars ($1,000,000) combined single limit each accident. This coverage shall include all owned, hired, and non -owned automobiles. C. Workers compensation and employers liability coverage. Statutory workers compensation benefits in accordance with the statutes and regulations of the State of Texas. Company must provide the City with a waiver of subrogation for workers compensation claims. D. Any contractors or subcontractors working in the Public Right -of -Way on behalf of Company are agents of Company. Company shall remain the responsible party for damage to and/or in the Public Right -of -Way resulting from any work of Company or its agents. City shall submit claims for any such damage to the Public Right -of -Way to Company. Upon request, Company shall provide the City with proof of insurance for any of Company's contractors or sub- contractors that perform work in the Public Right -of -Way. E. The Company will provide proof of insurance in accordance with this Franchise within thirty (30) days of the effective date of the Franchise. Company will not be required to furnish separate proof when applying for permits. SECTION 5. EXTENSIONS FOR CUSTOMERS. Company shall, at its expense, extend distribution mains in any street up to one hundred (100) feet for any one residential or commercial customer so long as the customer at a minimum uses gas for unsupplemented space heating and water heating. Company shall not be required to Page 7 extend transmission mains in any Public Rights -of -Way within City or to make a tap on any transmission main within City unless Company agrees to such extension by a written agreement between Company and a customer. SECTION 6. DUTY TO SERVE. Company shall not arbitrarily refuse to provide service to any Person having a service location within the City and meeting Company's reasonable credit requirements that it is economically feasible for Company to serve. In the event that a Person is refused service, said Person may request a hearing before the City Council of City or its designee, said hearing to be held within forty-five (45) days from the date of the request for hearing. The Council may order Company to provide service or take any other action necessary to bring Company into compliance with the intent of the Council in granting this Franchise, including termination or forfeiture of the Franchise in accordance with Section 13. The Council may render its opinion at this meeting but in no event shall it be required to act in less than fourteen (14) days. SECTION 7. CUSTOMER SERVICE STANDARDS-, LOCAL OFFICE. A. Company shall maintain a local, toll-free or collect call telephone access line which will be available to its customers 24 hours a day, seven days a week. B. Company shall make a good faith effort to maintain within City one or more locations where customers can pay their bills. In no circumstance shall the absence of such a location be considered violation of a material provision of this Franchise as outlined in Section 13. SECTION 8. RATES. Company's rates and charges shall be established and shall be subject to revision and change in accordance with all applicable statutes and ordinances. Company shall maintain on file with City copies of its current tariffs, schedules or rates and charges, customer service provisions, and line extension policies. SECTION 9. INDEMNITY. A. In consideration of the granting of this Franchise, Company agrees to indemnify, defend, and hold harmless City, its officers, agents, employees (City and such other persons and entities being collectively referred to herein as "Indemnitees"), from and against all suits, actions or claims of injury to any person or persons, or damages to any property brought or made for or on account of any death, injuries to, or damages received or sustained by any person or persons or Page 8 for damage to or loss of property arising out of, or occasioned by Company's intentional and/or negligent acts or omissions in connection with Company's operations; except that the indemnity provided for in this paragraph shall not apply to the extent any liability is determined to have resulted from negligence or intentional acts or omissions of City, its officers, agents, and employees. In the event of joint and concurrent negligence or fault of both Company and City, responsibility and indemnity, if any, shall be apportioned comparatively in accordance with the laws of the State of Texas without, however, waiving any of the defenses of the parties under Texas law. Further, in the event of joint and concurrent negligence or fault of both Company and City, responsibility for all costs of defense shall be apportioned between City and Company based upon the comparative fault of each. B. In fulfilling its obligation to defend and indemnify City, Company shall have the right to select defense counsel, subject to City's approval, which shall not be unreasonably withheld. Company shall retain defense counsel within seven (7) business days of City's written notice that City is involving its right to indemnification under this Franchise. If Company fails to retain counsel within such time period, City shall have the right to retain defense counsel on its own behalf, and Company shall be liable for all defense costs incurred by City, except as set out in Section 9.A. C. Company will require its self-insurance to respond to the same extent as if an insurance policy had been purchased naming the City as an additional insured, and any excess coverage purchased for the sole purpose of insuring Company's obligations pursuant to this agreement will name the City as an additional insured up to the amounts required by City's ordinance. D. The obligations set forth in this Section 9 shall survive the termination of this Franchise. SECTION 10. NON-EXCLUSIVE FRANCHISE. The rights, privileges, and franchises granted by this ordinance are not to be considered exclusive, and City hereby expressly reserves the right to grant, at any time, like privileges, rights, and franchises as it may see fit to any other person or corporation for the purpose of transporting, delivering, distributing, or selling gas to and for City and the inhabitants thereof. Page 9 SECTION 11. PAYMENTS TO CITY. A. In consideration of the privilege and license granted by City to Company to use and occupy the Public Rights -of -Way in the City for the conduct of its business, Company, its successors and assigns, agrees to pay and City agrees to accept, such franchise fees in the amount and manner described herein. Except as provided for in this section and in Section I I.B., such payments shall be made on a quarterly basis for the calendar quarter in which the payment is made, beginning on or before the 3Is' day of January, 2018, and on or before the 31 st day of April, July, and October, during the term of this Franchise. The first payment due on January 31, 2017 shall be based on the time period between October 1, 2017 and December 31, 2017. The last payment under the initial term shall be made on or before October 31, 2027 and shall be based on the time period between July 1, 2027 and September 30, 2027. The franchise fee shall be a sum of money that shall be equivalent to five percent (5%) of the quarterly Gross Revenues, as defined in Section 2 above, received by Company during the preceding calendar quarter. B. The franchise fee amounts based on "Contributions in Aid of Construction" ("CIAC") shall be calculated on an annual calendar year basis, i.e., from January 1 through December 31 of each calendar year. The franchise fee amounts that are due based on CIAC shall be paid at least once annually on or before April 30 each year based on the total CIAC recorded during the preceding calendar year. The CIAC franchise fee payment will be due on or before April 30, 2018, and will be based on CIAC received from January 1, 2017, through December 31, 2017. The final payment of franchise fee amounts based on CIAC under the initial term will be made on or before April 30, 2028, and will be based on CIAC for the time period between January 1, 2027 and December 31, 2027. The obligation to make said final payment shall survive the initial term of this Franchise C. It is also expressly agreed that the aforesaid payments shall be in lieu of any and all other and additional occupation taxes, easement, franchise taxes or charges (whether levied as an ad valorem, special, or other character of tax or charge), municipal license, permit, and inspection fees, bonds, street taxes, and street or alley rentals or charges, and all other and additional municipal taxes, charges, levies, fees, and rentals of whatsoever kind and character that City may now impose or hereafter levy and collect from Company or Company's agents, excepting only the usual general or special ad valorem taxes that City is authorized to levy and impose upon real and personal property. Except however, Company's separate obligations to reimburse the City for Page 10 City's reasonable rate case expenses and for street repairs in accordance with City's ordinances, are not affected by Company's payment of franchise fees hereunder. If the City does not have the legal power to agree that the payment of the foregoing sums of money shall be in lieu of occupation taxes, licenses, fees, street or alley rentals or charges, easement or franchise taxes or charges aforesaid, then City agrees that it will apply so much of said sums of money paid as may be necessary to satisfy Company's obligations, if any, to pay any such occupation taxes, licenses, charges, fees, or rentals. D. If Company fails to pay when due any payment provided for in this section, Company shall pay such amount plus interest consistent with the rate for customer deposits under Texas Utilities Code Section 183.003 from such due date until payment is received by City. E. Atmos Energy Franchise Fee Recovery Tariff (1) Company may file with the City a tariff or tariff amendment(s) to provide for the recovery of the franchise fees under this agreement. (2) City agrees that (i) as regulatory authority, it will adopt and approve the ordinance, rates, or tariff which provide for 100% recovery of such franchise fees as part of Company's rates; (ii) if the City intervenes in any regulatory proceeding before a federal or state agency in which the recovery of Company's franchise fees is an issue, the City will take an affirmative position supporting 100% recovery of such franchise fees by Company and; (iii) in the event of an appeal of any such regulatory proceeding in which the City has intervened, the City will take an affirmative position in any such appeals in support of the 100% recovery of such franchise fees by Company; and (iv) it will take no action, nor cause any other person or entity to take any action, to prohibit the recovery of such franchise fees by Company. F. This Franchise is granted solely to Company. Company is not authorized to license or lease to any person or entity the right to occupy and use any Public Right -of -Way for any private business or other purpose. Transportation set -vice provided by Company to or for others shall not be considered a licensing or leasing of any right to occupy and use any Public Right -of -Way. G. Upon receipt of written notice from the City that the City has annexed or disannexed any area, including a map showing the area annexed or disannexed, Company shall promptly initiate a process to reclassify affected customers into the City limits no later than sixty Page 1 I (60) days after receipt of notice from City. In no event shall the Company be required to add premises for the purposes of calculating franchise payment prior to the earliest date that the same premises are added for purposes of collecting sales tax. Upon request from City, Company will provide documentation to verify that affected customers were appropriately reclassified and included for purposes of calculating franchise payments. SECTION 12. BOOKS AND RECORDS. A. Company agrees that at the time of each quarterly payment, Company shall also submit to the City a statement showing its Gross Revenues for the preceding calendar quarter. B. City may, if it sees fit, upon reasonable notice to the Company, have the books and records of Company examined by an auditor designated by City to ascertain the correctness of the reports agreed to be filed herein. Company shall make available, during normal working hours and upon reasonable notice, such personnel and records as the auditor may in its reasonable discretion request in order to complete such audit, and shall make no charge to the City therefor. Company shall assist City in its review by providing all requested information no later than fifteen business (15) days after receipt of a request. The cost of the audit shall be borne by City unless the audit discloses that the Company has underpaid the franchise fee by 10% or more, in which case the reasonable costs of the audit shall be immediately reimbursed to the City by the Company. If such an examination reveals that Company has underpaid City, then upon receipt of written notification from City regarding the existence of such underpayment, Company shall undertake a review of City's claim and if said underpayment is confirmed, remit the amount of underpayment to City, including any interest calculated in accordance with Section 11.D. Should Company determine through examination of its books and records that City has been overpaid, upon receipt of written notification from Company regarding the existence of such overpayment, City shall review Company's claim and if said overpayment is confirmed, remit the amount of overpayment to Company including any interest calculated in accordance with Section i I.D. C. If the Company provides confidential or proprietary information to the City or its auditor, the Company shall be solely responsible for identifying such information with markings calculated to bring the City's attention to the proprietary or confidential nature of the information. The City agrees to maintain the confidentiality of any non-public information obtained from Company so designated to the extent allowed by law. City shall not be liable to Company for the release of any information the City is required to release by law. If the City receives a request Page 12 under the Texas Public Information Act that includes Company's proprietary or confidential information, City will notify the Texas Attorney General of the proprietary or confidential nature of the document(s). The City also will provide Company with a copy of this notification, and thereafter Company is responsible for establishing that an exception under the Texas Public Information Act allows the City to withhold the information. SECTION 13. TERMINATION. A. Right to Terminate. In addition to any rights set out elsewhere in this Ordinance, City reserves the right to terminate the Franchise and all rights and privileges pertaining thereto, in the event that Company violates any material provision of the Franchise. B. Procedures for Termination. (1) City may, at any time, terminate this Franchise for a continuing material violation by Company of any of the substantial terms hereof. In such event, City shall give to Company written notice, specifying all grounds on which termination or forfeiture is claimed, by registered mail, addressed and delivered to Company at the address set forth in Section 14.A. hereof. Company shall have sixty (60) days after the receipt of such notice within which to cease such violation and comply with the terms and provisions hereof. In the event Company fails to cease such violation or otherwise comply with the terms hereof, then Company's Franchise is subject to termination under the following provisions. Provided, however, that if Company commences work or other efforts to cure such violations within thirty (30) days after receipt of written notice and shall thereafter prosecute such curative work with reasonable diligence until such curative work is completed, then such violations shall cease to exist, and the Franchise will not be terminated. (2) Termination shall be declared only by written decision of the City Council after an appropriate public proceeding whereby Company is afforded the full opportunity to be heard and to respond to any such notice of violation or failure to comply. Company shall be provided at least fifteen business (15) days prior written notice of any public hearing concerning the termination of the Franchise. In addition, ten (10) days' notice by publication shall be given of the date, time and place of any public hearing to interested members of the public. Page 13 (3) City, after full public hearing, and upon finding material violation or failure to comply, may terminate the Franchise or excuse the violation or failure to comply, upon a showing by Company of mitigating circumstances or upon a showing of good cause of said violation or failure to comply as may be determined by the City Council. (4) Nothing herein stated shall preclude Company from appealing the final decision of the City Council to a court or regulatory authority having jurisdiction. (5) Nothing herein stated shall prevent City from seeking to compel compliance with the terms of this Franchise by suit in any court of competent jurisdiction if Company fails to comply with the terms of this Franchise after due notice and the providing of adequate time for Company to comply with said terms. SECTION 14. NOTICES. A. Any notices required or desired to be given from one party to the other party to this Ordinance shall be in writing and shall be given and shall be deemed to have been served and received if. (i) delivered in person to the address set forth below; (ii) deposited in an official depository under the regular care and custody of the United States Postal Service located within the confines of the United States of America and sent by certified mail, return receipt requested, and addressed to such party at the address hereinafter specified; or (iii) delivered to such party by courier receipted delivery. Either party may designate another address within the confines of the continental United States of America for notice, but until written notice of such change is actually received by the other party, the last address of such party designated for notice shall remain such party's address for notice. CITY City Manager City of Anna P.O. Box 776 Anna, Texas 75409 Page 14 With copies to: Wolfe, Tidwell & McCoy, LLP 2591 Dallas Parkway, Suite 300 Frisco, TX 75034 COMPANY Manager of Public Affairs Atmos Energy Corporation, Mid -Tex Division 5111 Blue Flame Lane Sherman, TX 75090 B. The Company shall provide to the City a local or toll-free telephone number that is manned twenty-four (24) hours a day, seven (7) days a week to provide available information relating to emergency situations. The City understands that this telephone number is not equipped to handle calls from the public, and the City will not provide this number to customers, but will direct them to the Company's Call Center. If the Company cannot timely respond to an emergency with Company employees, the Company will attempt to respond to the emergency with qualified local contractors. The Company's contact information shall be kept current at all times. The Company and the City shall periodically, and upon request by either party, meet to discuss and address emergency response issues, in order to rectify any problems identified by either party. SECTION 15. SUCCESSORS AND ASSIGNS. The Company may, without consent by City, transfer or assign the rights granted by this Franchise to an Affiliate. Company shall give prior written notice to City of such intended transfer or assignment, and shall provide in such notice identifying information of the Affiliate, including contact information for routine and emergency matters. City will otherwise have the right to approve the transfer or assignment of the franchise to a non -Affiliate. City shall grant approval unless the assignee is materially weaker than the Company. For the purpose of this section, "materially weaker" means that the long term unsecured debt rating of the assignee is less than investment grade as rated by both S&P and Moody's. The City may request additional documents and information reasonably related to the transaction and to the legal, financial, and technical qualifications of the assignee. City agrees that approval of a transfer or assignment to a non - Affiliate that is materially weaker shall not be unreasonably withheld or delayed. The terms and conditions contained in this Ordinance shall be binding upon Company, its successors, and assigns. Upon request by City, Company shall require its successor, transferee, or assignee to provide City with a written express assumption of all rights and obligations under this Franchise. Page 15 SECTION 16. RENEGOTIATION. If either City or Company requests renegotiation of any term of this Ordinance, Company and City agree to renegotiate in good faith revisions to any and all terms of this Ordinance. If the parties cannot come to agreement upon any provisions being renegotiated, then the existing provisions of this Ordinance will continue in effect for the remaining term of the Franchise. SECTION 17. NO WAIVER. Either City or Company shall have the right to waive any requirement contained in this Ordinance, which is intended for the waiving party's benefit, but, except as otherwise provided herein, such waiver shall be effective only if in writing executed by the party for whose benefit such requirement is intended. No waiver of any breach or violation of any term of this Ordinance shall be deemed or construed to constitute a waiver of any other breach or violation, whether concurrent or subsequent, and whether of the same or a different type of breach or violation. SECTION 18. SEVERABILITY. This Ordinance and every provision hereof, shall be considered severable, and the invalidity or unconstitutionality of any section, clause, provision, or portion of this Ordinance shall not affect the validity or constitutionality of any other portion of this Ordinance. If any term or provision of this Ordinance is held to be illegal, invalid, or unenforceable, the legality, validity, or unenforceability of the remaining terms or provisions of this Ordinance shall not be affected thereby. SECTION 19. ACCEPTANCE OF FRANCHISE. City shall provide Company with a certified copy of this Franchise by certified mail within five (5) days of passage. In order to accept this Franchise, Company must file with the City Secretary its written acceptance of this Franchise Ordinance within thirty (30) days after its final passage and approval by City. If such written acceptance of this Franchise Ordinance is not filed by Company, the Franchise Ordinance shall be rendered null and void. Page 16 SECTION 20. PARAGRAPH HEADINGS. CONSTRUCTION. The paragraph headings contained in this Ordinance are for convenience only and shall in no way enlarge or limit the scope or meaning of the various and several paragraphs hereof. Both parties have participated in the preparation of this Ordinance and this Ordinance shall not be construed either more or less strongly against or for either party. SECTION 21. EFFECTIVE DATE. This Franchise shall be effective on , 2017, if City has received Company's timely acceptance as provided by Section 20 herein. DULY PASSED by the City Council of the City of Anna, Texas, this the 01 day of , 2017. ATTEST: &A�b� Carrie Smith, City Secretary APPROVED AS TO FORM: City Attorney STATE OF TEXAS COUNTY OF COLLIN CITY OF ANNA APPROVED: Nate Pike, Mayor City of Anna, Texas I, Carrie Smith, City Secretary of the City of Anna, Collin County, Texas, do hereby certify that the above and foregoing is a true and correct copy of an ordinance passed by the City Council of the City of Anna, Texas, ata session, held on the day of2017, as it appears of record in the Minutes in Book , page WITNESS MY \\H'Ah1A,�EAL OF SAID CITY, this the%Z`day of gp mn-&A 2017. * * Carrie Smith, City Secretary City of Anna Texas •�,/'`����ll�;,l"'�11``�1,``` Page 17