HomeMy WebLinkAbout2724 RESOLUTION NO. 2724
A RESOLUTION approving the change of control of Falcon
Video Communications, L.P., holder of a Cable Franchise in
Bremerton, Washington, to Charter Communications Holding
Company, LLC
1. Falcon Video Communications, L.P. CFranchisee") holds a valid franchise to operate a
cable television system in Bremenon, WA ("Franchising Authority") issued by City of Bremenon
Ordinance No. 4635, passed by the City Council on November 4, 1998.
2. Charter Communications, Inc. CCCI") and certain affiliates of the Franchisee (including
the Franchisee's ultimate parent company, Falcon Communications, L.P, ("Falcon") have entered
into a Purchase and Contribution Agreement (the "Agreement") dated May 26, 1999, pursuant to
which CCI's affiliate, Charter Communications Holding Company, LLC ("Charter"), will acquire
control of Falcon.
3. Section 27 and 2.8 of the Falcon/Bremerton franchise prohibit a franchise transfer or
change in control without the prior written consent of the City of Bremerton. Section 2.7 of the
franchise provides that the City of Bremerton may condition a transfer upon such terms and
conditions related to the technical, legal, and financial qualifications of the prospective transferee
to perform according to the terms of the Franchise as the City deems appropriate, including those
conditions deemed necessary by the City to ensure the strict performance of the requirements of
the franchise.
4. The proposed change in control of Falcon is subject to the requirements of the Cable
Communications Policy Act of 1992 C1992 Cable Act"), and applicable implementing regulations
of the Federal Communications Commission ("FCC"). Falcon and Transferee filed FCC Form
394 pursuant to the 1992 Cable Act and FCC regulations, which was received by the City of
Bremerton on June 25, 1999. In conjunction with such filing, Falcon and Charter have stated that
the filing involves only a change in control at the parent level of Falcon, that the Franchisee will
continue to hold the Falcon/Bremerton franchise, that local management and employees of Falcon
will remain in place after the change in control, and that all commitments, obligations, and
liabilities will remain in place, whether or not such commitments, obligations, or liabilities pre-
dated the consummation of the proposed change in control.
5. It is recommended that the City approve the transfer of control subject to certain
conditions, including: (a) assurances regarding Transferee's obligation to cause Franchisee to
comply with all existing FalconfBremerton franchise requirements; (b) documentation of
Transferee and Falcon corporate organization and proxy statements issued in connection with the
merger; (c) assurances regarding completion of current Falcon/Bremerton upgrade; (d) assurances
regarding construction and completion of Bremenon institutional network commitments; (e)
commitments to comply with all applicable laws regarding nondiscriminatory access to
Franchisee's proposed Internet cable modem platform and services; (f) commitments to comply
with all applicable laws regarding commercial leased access; (g) reimbursement of all direct, out-
of-pocket costs of the City incurred in analyzing and acting upon change of control request; and
(h) compliance with all other applicable legal requirements, including carriage of broadcast digital
and high definition television signals, and interconnection of cable system with potential
competitors for purposes of sharing cable PEG channels, to the extent required by the
Falcon/Bremerton franchise agreement.
6. The City should approve the change in control of the Falcon/Bremerton franchise to
Transferee subject to the formal acceptance by Transferee of the conditions set forth in this
Resolution.
BE IT RESOLVED by the City Council of the City of Bremerton that:
a. The City of Bremenon hereby approves the transfer of control of the cable franchise of Falcon
Video Communications, L.P., Ordinance No. 4635 passed by the Council November 4, 1998 to
Transferee subject to the following conditions:
(1) Compliance with franchise. Transferee shall cause Franchisee to comply, with the lawful
requirements of the Falcon/Bremenon franchise, including all applicable ordinances, orders,
contracts, agreements, commitments, side letters, and regulatory actions taken pursuant thereto,
including but not limited to system upgrade commitments, support for Public, Educational, and
Governmental (PEG) cable access; and institutional network construction requirements in all
respects and without exception.
(2) Organization and proxy statements. Within thirty (30) days of the earlier of closure of the
merger transaction or public release of the requested information, Transferee shall submit (a)
updated Transferee and Falcon corporate organization charts; and (b) all publicly available proxy
statements issued in connection with the merger.
(3) Non-discriminatory access to cable modem platform. Transferee shall comply, and cause
Franchisee to comply with all lawful federal, state and local legal requirements with respect to
nondiscriminatory access, to the Franchisees' cable modern platform for providers of Internet and
on-line services, whether or not such providers are affiliated with Transferee or the Franchisee.
So long as cable modem services are deemed to be "cable services", as provided under Title VI of
the Communications Act of 1934, as amended. Transferee and the Franchisee shall comply with
all lawful requirements regarding such services, including but not limited to, the inclusion of
revenues from cable modem services and access within the gross revenues of the Franchisee's
cable franchise.
(4) Commercial Leased Access. Transferee shall comply and cause Franchisee to comply with
all lawful federal, state and local requirements with respect to commercial leased access.
(5) Reimbursement of costs. Upon invoice by the City, Franchisee shall within thirty (30)
days of the invoice reimburse all reasonable direct, out-of-pocket costs of the City incurred in
analyzing and acting upon Transferee's change of control request, not to exceed $2,500.
Payment of such reimbursement shall accompany the form of written acceptance, as provided in
subsection c., below.
(6) Compliance with all other applicable legal requirements. Transferee shall cause the
Franchisee to comply, with all other applicable legal requirements that are now or may hereafter
apply to Falcon's/Bremerton's cable operations, including, but not limited to, carriage of
broadcast digital and high definition television signals, interconnection of cable system with
potential franchised cable competitors for purposes of sharing cable PEG channels, and adherence
to applicable federal and state emergency notification provisions to the ex tent required by the
Falcon/Bremerton Franchise agreement.
(7) Responsibility for any non-compliance by franchisee. Franchisee agrees that as a result of
approval of this transfer transaction, the City has not waived or diminished any compliance
enforcement rights it possessed prior to the approval of the transfer transaction. All such rights
are enforceable against Franchisee pursuant to paragraph 6 (a) (1) above.
b. Written acceptance.
(1) This resolution shall not be effective until accepted in writing by Transferee. The
acceptance, which shall be contingent upon final closing of the transaction shall be substantially
similar in form to that attached hereto as Exhibit I.
(2) Within thirty (30) days after passage of this resolution by the Council, Transferee shall file
in the Office of the Administrative Services Director such written acceptance of this resolution
meeting the approval of the City Attorney.
(3) A failure on the pan of Transferee to file such written acceptance within such time shall be
deemed an abandonment and rejection of the fights and privileges conferred hereby and this
resolution shall thereupon be null and void. Such acceptance shall be unqualified and shall be
construed to be an acceptance of all the terms, conditions and restrictions contained in this
resolution.
c. Automatic nullification in event of failure to close or closure on materially different terms. In
the event the transaction which is the subject of this resolution is not consummated or does not
reach final closure for any reason, or in the event such closure is reached on terms substantially
and materially different to the terms described in the FCC Form 394 and subsequent information
provided by the Transferee and relied upon by the City, then this resolution, together with the
written acceptance provided hereunder, shall be null and void.
PASSED by the City Council of the City of Bremerton this 18th day of August,
1999.
MIKE SHEPHERD, Council President
SEP-20-99 HON 02:23 PH F~X N0. P. 02/06
EXHIBIT I
ACCEPTANCE
Director of Administrative Services
City of Bremerton
239 Fourth Street
Bremenon, Washington 98337
This is to advise the City of Bremenon, Washington that Charter Communications, Inc. hereby
accepts the terms and provisions of Resolution No. 2724, passed by the City Council on
August 18, 1999, consenting to a change in control of Falcon Cable franchise to Charter
Communications, with conditions. Charter Communications agrees to abide by, and to cause
Charter Communications and its subsidiaries and affiliates to abide by, each and every provision of
the franchise agreements, including all applicable ordinances, orders, contracts, agreements, side
letters, commitments, and regulatory actions taken pursuant hereto, as applicable, and without
exception.
CHjyTT~~CATIO S HOLDING COMPANY, LLC
Title: V','C ~ P v._
Date: :Y ' '~2 f' ~ ~
State of /~,'~ C
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County of ~-~ Lc, ct ,'5)
This Acceptance was acknowledged before me on the .2 t -3 .~ day of 5-~ p ~;'~ ~, ~ ~ ~ ,
duly authorized o~cer of Charier Communications Holding Company, LLC.
.
b"' .~,~ ": ~ ':'// ('~ DIANA M HU~R
/
/ ~ ~ - No~ Seal
Nota~ Public for S~ ~ Missouri
~ ~ ~. ~uis
My ~0~mltll0~ ~pltlt 00t, 8. 2002