ITEM 3.7 Resolution 14-700
OtsTe F o
MINNESOTA V
Request for
City Council Action
DEPARTMENT INFORMATION
ORGINATING DEPARTMENT: REQUESTOR:
Legal Andy MacArthur, City Attorn
PRESENTER(s):
Consent
AGENDA ITEM DETAILS
REVIEWED BY:
Lori Johnson, City Administrator
MEETING DATE:
October 13, 2014
ITEM #:
3.7
RECOMMENDATION: Charter has requested that the City adopt the attached resolution consenting to
transfer of control. City staff recommends that the City adopt the attached resolution.
ARE YOU SEEKING APPROVAL OF A CONTRACT?
IS A PUBLIC HEARING REQUIRED?
No.
No.
BACKGROUNDMUSTIFICATION: The City granted Charter (CC VIII Operating, LLC) a cable television franchise in
2002. The Franchise will expire in 2017. Charter has asked that the City to adopt the attached resolution
consenting to transfer of control of the Franchisee. The Franchisee will ultimately become part of the
newly established New Charter.
I have checked with the attorney (Bob Vose) who represented the City regarding the original franchise in
2002 and he indicated that some larger metro area cities have hired experts to look at the financials to
see whether or not inordinate debt is being assumed.
I am assuming that Otsego would not want to go through this expense, especially in light of the fact that
the Franchise will come up for renewal in 2017. Although the Franchise ordinance does not specifically
require consent, I believe it is the best practice to have documented formal consent.
SUPPORTING DOCUMENTS: ❑ ATTACHED ❑ NONE
• Resolution Consenting to Transfer of Control.
MOTION: (Please word motion as you would like it to appear in the minutes.)
Motion to approve Resolution No. 2014-70 consenting to transfer of control.
BUDGET INFORMATION
FUNDING:
NA
ACTION TAKEN
BUDGETED: ❑ YES
❑ NO
❑ APPROVED AS REQUESTED ❑ DENIED ❑ TABLED ❑ OTHER (List changes)
COMMENTS:
NOW, THEREFORE BE IT RESOLVED by the City Council of the City of
Otsego, Wright County, Minnesota (Franchise Authority) as follows;
1. The Franchise Authority consents to the Transaction.
2. The Franchise Authority confirms that the Franchise is valid and
outstanding and in full force and effect and there are no defaults under the
Franchise. Subject to compliance with the terms of this Resolution, all
action necessary to approve transfer of control of the Franchisee to Charter
has been duly and validly taken.
3. Charter, New Charter or the Franchisee may (a) assign or transfer its assets,
including the Franchise, provided that such assignment or transfer is to an
entity directly or indirectly controlling, controlled by or under common
control with Charter or New Charter; (b) restructure debt or change the
ownership interests among existing equity participants in Charter or New
Charter; (c) pledge or grant security interest to any lender(s) of Charter's or
New Charter's assets, including, but not limited to, the Franchise, or of
interest in Charter or New Charter, for purposes of securing any
indebtedness; and (d) sell equity interests in Charter or New Charter or any
of Charter's affiliates.
4. Upon closing of the Transaction, the Franchisee shall remain bound by the
lawful terms and conditions of the Franchise.
5. This Resolution shall be deemed effective upon adoption.
6. This Resolution shall have the force of a continuing agreement with
Franchisee, and the Franchise Authority shall not amend or otherwise alter
this Resolution without the consent of Franchisee and Charter or New
Charter.
ADOPTED this 13th day of October, 2014 by the City Council of Otsego.
MOTION TO ADOPT the Resolution by Council Member
and seconded by Council Member
IN FAVOR:
OPPOSED:
2
CITY OF OTSEGO
Jessica Stockamp, Mayor
Tami Loff, City Clerk