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HomeMy WebLinkAboutexhibitNON-EXCLUSIVE FRANCHISE AGREEMENT THIS NON-EXCLUSIVE FRANCHISE AGREEMENT (this "Agreement") is made and entered into this , 2004, but effective as of November 18, 2004, by and between the City of Miami, a municipal corporation of the State of Florida (the "City"), and NUI Utilities, Inc., a New Jersey corporation authorized to do business in the State of Florida, d/b/a NUI City Gas Company of Florida (the "Franchisee"). WITNES SETH: WHEREAS, pursuant to City Ordinance No. 8309, the City has granted to the Franchisee's predecessor -in -interest, City Gas Company of Florida, and its successors and assigns, a non-exclusive franchise (the "Current Franchise") to construct, erect, install, extend, maintain and operate its gas system facilities within the City; and WHEREAS, the term of the Current Franchise expires in November 2004 and the City and the Franchisee desire to enter into a new long-term franchise agreement, but have not yet concluded negotiations on the acceptable terms of such agreement; and WHEREAS, in order to allow the City's consumers continue to receive gas service from the Franchisee, to allow the City to continue to receive franchise fees therefrom and to allow the City and the Franchisee time to enter into a new long—term franchise agreement on mutually agreeable terms and conditions, the City and the Franchisee have agreed to enter into this short- term interim franchise agreement on the terms set forth herein; WHEREAS, the Commission of the City of Miami ("City Commission"), by Ordinance No. , adopted on , 2004, authorized the City Manager to execute a contract, under the terms and conditions set forth herein. l-MI/537190.1 1 NOW THEREFORE, in consideration of the foregoing and the mutual agreements contained herein, the City and the Franchisee hereby agree as follows: Section I. DEFINITIONS. . The word "Franchisee" shall mean NUI Utilities, Inc., a New Jersey corporation, d/b/a NUI City Gas Company of Florida, its successors and assigns, and the word "City" shall mean the City of Miami, Florida, its successors and assigns, and the word "Consumer" shall mean any person, firm, or public or private corporation served by the Franchisee. Section 2. GRANT. There is hereby granted to the Franchisee for a term beginning November 18, 2004 and ending on February 28, 2005, a limited exclusive right to erect, install, extend, maintain and operate a system of works, pipes, pipe lines and all necessary apparatus, machinery, structures, and appurtenances in, on and under the streets, alleys, avenues, easements, and other public ways and places, in the City of Miami, Florida, as it is now constituted and as it may hereafter be added to or extended in the area bounded on the East by 27th Avenue as the same is extended North and South to the City limits and from 27th Avenue West to the Western boundaries of the City, for the purpose of transporting, distributing, and selling manufactured or natural gas to said City, its inhabitants and the public generally, for domestic, commercial and industrial uses, and for any and all other purposes for which gas, during the period of this grant, may be used, together with the right to enter upon the streets, alleys, avenues, easements, and other public. ways, places, and ground of said City for the purpose of removing and repairing said works, pipes, pipe lines and all necessary apparatus, machinery, structure or structures and appurtenances. 1-MI/537190.1 2 Section 3. ASSIGNMENT. No sale, assignment, or transfer of the rights granted hereby except to an affiliate of Franchisee shall be effective unless the .Franchisee shall have filed written notice thereof with the City Manager, at least sixty (60) days prior to the scheduled date of such sale, assignment or transfer, and unless, subsequent to the filing of such notice, the City Commission shall have by ordinance approved and consented to such sale, assignment or transfer; provided, however, that any sale, assignment or transfer, decreed by a court of competent jurisdiction in any receivership or bankruptcy proceedings shall not be governed by the provisions of this Section. Section 4. USE OF STREETS. The said pipe lines, pipes, apparatus, structures, and appurtenances shall be erected, placed or laid in such manner as will, consistent with necessity, least interfere with other public uses of said streets, alleys, avenues, easements, and public grounds, and said streets shall not be unnecessarily obstructed, and before the Franchisee makes any excavation or disturbs the surface of any of the streets, alleys or other public places, it shall make application for a permit to the appropriate City authority and shall, with due diligence and dispatch, place such streets or public places in as good condition and repair as before such excavation or disturbance was made, and in default thereof the City may make such repairs and charge the cost thereof to the Franchisee and collect the same from it. The City retains the right of reasonable regulation of the erection or construction of any works or laying any pipe or pipe lines, and to reasonably designate where such works and pipe lines shall be placed. The Franchisee hereby agrees to abide by all the rules and regulations and ordinances which the City has passed or might pass in the future, and further agrees to abide by 1-MI/537190.1 3 any established policy which the City Commission or its duly authorized representative has passed; or established; or will establish; provided, however, it is not intended hereby that the City shall have the right of breaching the terms of this franchise other than is herein provided. Section 5. MAINTENANCE, All such works, pipes, pipe lines, apparatus, structures, appurtenances and the entire plant and system of Franchisee shall be constructed and maintained in such condition as will enable it to furnish adequate and continuous service and shall be constructed, installed and maintained in accordance with accepted good practice and in accordance with the orders, rules and regulations of the Florida Public Service Commission or other regulatory body having jurisdiction over the Franchisee. Section b. LAYING OF PIPE. All main pipe lines shall be laid at least two feet and all lateral pipe lines not less than eighteen inches below the established grade of said streets, avenues, alleys, easements, and other public ways and places as such grades now exist or may hereafter be established, unless otherwise specifically authorized by proper authority of the City. Section 7. CONSTRUCTION WORK. The City reserves the right to lay and permit to be laid electric conduits, water, gas and other pipe lines or cables, sewers, and to do and permit to be done any underground work that may be necessary or proper by the City Commission or other governing body of the City in, across, along or under any street, alley, public way, easement, place -or other public ground. In permitting such work to be done, the City shall not be liable to the Franchisee herein for any damages so occasioned, nor shall the City in doing such work be liable to the Franchisee for any damages not wilfully and unnecessarily occasioned. Whenever, by reason of establishing 1-MU537190.1 4 a grade or by reason of changes in the grade of any street, or by reason of the widening, grading, paving or otherwise improving present or future streets, alleys, or other public ways and places, or in the location or manner of construction of any water pipes, electric conduits, sewers or other underground structures, it shall be deemed necessary by the City Commission, or other governing body of the City, to alter, change, adapt or conform the mains, pipe lines, service pipe or other apparatus or appurtenance of the Franchisee hereto, such alterations, or changes, shall be made by the Franchisee as ordered in writing by the City Commission or other governing body of the City, without claim for reimbursement or compensation for damages against the City. If the City shall require the Franchisee to adapt or conform its pipe lines, pipes, structures apparatus, appurtenances or other appliances, or in any way to alter, relocate or to change its property to enable any other person or corporation, except the City, Miami -Dade County, or the State of Florida, to use said street, alley, easement, highway or public place, the Franchisee shall be reimbursed by the person or corporation desiring or occasioning such change for any loss, cost or expense caused by or arising out of such change, alteration or relocation of Franchisee's property. The Franchisee further agrees that it shall not interfere with, change or injure any water pipes, drains, or sewers of the City, unless it has received specific permission from the City Commission, its duly authorized representative or Board. Section 8. Indemnification. Prior to the beginning of any work by the Franchisee within the corporate limits of the City of Miami, Florida, the Franchisee shall file with the City's Risk Management Administrator and shall keep in full force and effect at all times during the effective period hereof, insurance certificates evidencing a liability insurance policy or policies, the terms and conditions whereof shall be such as to provide for the protection and indemnification of the City 1-MI/537190.1 5 with respect to any and all legally valid claims of any persons suffering injury, loss or damage to person or property by reason of the construction or operation of Franchisee's natural gas distribution system within the corporate limits of the City of Miami, Florida. Each such insurance policy shall be subject to the acceptance and approval of the City's Risk Management Administrator. Any primary insurance policy must be issued by a Company having a policyholder's surplus at least five times the amount of coverage of the policy, and the Company must have a minimum rating of at Best's Rating Guide. 0 t4f 1 tt in the current listing of 140. Every such insurance certificate shall contain a provision whereby every company executing the same shall obligate itself to notify the City's Risk Management Administrator, in writing, at least thirty (30) days before any alteration, modification, or cancellation of such policy is to become effective. All insurance required hereunder may be maintained by the Franchisee and/or by an affiliate of the Franchisee by self-insurance or pursuant to a master or so-called blanket policy of insurance. The City shall be named as an additional insured on such insurance policy. In the event that any suit is filed or action brought against the City, either severally or jointly with the Franchisee, by any person or corporation seeking to recover damages resulting from or attributable to the operations or the existence of the Franchisee within the City, or arising in any manner whatsoever out of the operations or existence of the Franchisee I-MU537190.1 6 within the City, whether due to the Franchisee's negligence or otherwise, the Franchisee shall, upon written notice by the City, defend said suit or action and, in the event any judgment therein should be rendered against the City, the Franchisee shall promptly pay the sum together with all costs resulting therefrom. Section 9. PERFORMANCE BOND. That, within five (5) business days of the approval of this Agreement by the City Commission, the Franchisee shall file with the City Clerk, after approval by the City Attorney, an annual bond in the minimum sum of $50,000.00, having as surety thereon a surety company qualified to do business in the State of Florida, and acceptable to the City, and conditioned for the full and faithful performance by the Franchisee of all requirements, duties and obligations imposed upon it by the provisions of this ordinance, and such bond to be furnished annually shall provide a continuing guarantee of such full and faithful performance at all times throughout the effective period hereof. Section 10. RULES - MAKING OF. The Franchisee shall have the right to make and enforce such reasonable rules and regulations as it may deem necessary for the extension of its facilities, and the sale of its gas and the prudent conduct of its business, provided that such rules and regulations shall not be in conflict with the laws, rules, and other regulatory authorities of the City, Miami -Dade County, or the State of Florida. Section 11. JURISDICTION. In the event that the Florida Public Service Commission, or other State regulatory authority, should be deprived of the authority to make rules and regulations governing the Franchisee, then the City Commission, or other governing body, shall have the right to fix 1-MI/537190.1 7 reasonable and compensatory rates to be paid for gas by the consumers, and to provide for the extension, repair, and maintenance of mains and service lines, and the connection with the pipes of the consumers and the installing and testing of meters, and to regulate the quality and pressure of gas, and to provide such other and further regulations as shall be reasonably necessary and proper to provide adequate service to consumers and to protect their interests. Section 12. ACCOUNTS AND RECORDS. The accounts and records of the Franchisee appertaining to gas service rendered hereunder shall be maintained within the State of Florida, and be open at all reasonable times for inspection by the duly authorized representatives of the City. The Franchisee shall use the Uniform System of Accounts for Public Gas Utilities prescribed by the Florida Public Service Commission of the State of Florida. The Franchisee shall establish and maintain appropriate accounts and records in such detail that revenues within the limits of the City of Miami are consistently declared separately from all other revenues. The Franchisee shall file in duplicate with the City Clerk of the City of Miami, monthly statements of gas revenues derived from within the City of Miami, annual financial statements and such other statements and reports as the City may reasonably prescribe. Within twenty (20) days after the close of each month, the Franchisee shall file as required by this section a statement of gas revenues derived from within the City of Miami for the preceding month. During each annual period and within one hundred twenty (120) days after the close of the Franchisee's fiscal year, the Franchisee shall file as required by this section the balance sheet of the year then ended, and the related statements of income and retained earnings certified by Certified Public Accountant. The Franchisee shall at all times make and keep full and complete plats, maps and records, showing the reasonably exact locations, depth and size of all pipes and I-MV537190.1 8 pipe lines owned by it in the City of Miami, or that may hereafter be laid, and showing the location and kind of all other works, structures, appliances and appurtenances, and shall furnish the City, within a reasonable time, with copies of all such plats, maps, and records, and these maps and records and all other records and contracts between the Franchisee for distribution in the City shall be available for inspection during business hours to the City through any duly authorized officer or employee of the City. Section 13. FRANCHISE FEE. In consideration of the approval of this Agreement by the City Commission, the Franchisee, its successors and assigns shall pay to the City, or its successors, on or before the 20th day of the month following the end of each immediately preceding month during the term of this franchise, a franchise fee for the said preceding month, of six percent (6%) of the Franchisee's gross revenue from the sale of natural gas to residential, commercial, governmental, industrial, and all other customers within the corporate limits of the City. Nothing herein shall be construed to be a limitation on the assessment and collection of valid taxes, licenses and other impositions by the City on and from the Franchisee in excess of such six percent (6%) for each month during the term of this franchise. Section 14. FORFEITURE OR REVOCATION OF GRANT. The violation by the Franchisee of any of the covenants, terms and conditions hereof, or default by the Franchisee in observing or carrying into effect any of said covenants, terms and conditions, shall authorize and empower the City Commission to declare a forfeiture of and to revoke and cancel all rights granted hereunder, provided, however, that before such action by the City Commission shall become operative and effective, the Franchisee shall have been served by the City with a written notice setting forth all matters pertinent to such violation I-MI/537190.I 9 or default, and describing the action of the City Commission with respect thereto, and Franchisee shall have had a period of sixty (60) days after service of such notice within which to terminate such violation or default; and provided further that any violation or default resulting from a strike, a lockout, an act of God or any other cause beyond the control of the Franchisee shall not constitute grounds for revoking and cancelling any rights hereunder. In the event that the Franchisee upon receipt of said written notice from the City does not desist from such violation within the time aforesaid, then the Franchisee shall be deemed to have forfeited and annulled and shall thereby forfeit and annul all of the said franchise, grants, privileges, rights, licenses and immunities given by this franchise. The Franchisee shall not enter into any verbal or written agreement with any person, firm, corporation, or other organization which agreement is conditioned upon the Franchisee receiving tax relief or any other relief from the City. Nothing herein contained shall prevent the Franchisee from negotiating with any person, firm, corporation, association, or other entity except Franchisee is prohibited from entering into any agreement with any person, firm, corporation, association or other utility receiving compensation from the City for the issuance of this franchise or the continuance thereof under its provisions. The Franchisee is required to make every effort to maintain operation and service at all times even in the event of any work stoppage by its employees. Section 15. TERMINATION OF GRANT BY INSOLVENCY OR BANKRUPTCY OF FRANCHISEE. That, in the event of a final adjudication of bankruptcy of the Franchisee, the City shall have full power and authority to terminate, revoke and cancel any and all rights granted under the provisions of this Agreement (Franchise). Section 16. CHANGES IN PROVISIONS HEREOF. l-M1/537190.1 10 That minor changes in the terms and conditions hereof may be made by written agreement between the City and the Franchisee without further ratification by the City Commission, provided, however, that this Section shall not be construed as conferring authority to make any substantial or substantive changes in or modifications of the provisions of this Agreement which would be repugnant to or inconsistent with basic factors or principles underlying the terms and conditions hereof. Section 17. REPEALING SECTION: That all City ordinances or parts of ordinances, insofar as they are inconsistent with or in conflict with the provisions of this Agreement, be and the same are hereby repealed. Section 18. SAVING PROVISION. That, if any section, part of section, paragraph, sentence or clause of this Agreement shall be adjudged by a court of competent jurisdiction to be invalid, such decision shall not affect the validity of any other portion hereof, but shall be restricted and limited in its operation and effect to that specific portion hereof involved in the controversy in which such decision shall have been rendered. Section 19. RIGHT TO PURCHASE. The City hereby reserves the right at and after the expiration of this grant, and/or in the event of the Franchisee's forfeiture of any of the terms, conditions and provisions of this Agreement, to purchase the physical property of the Franchisee used under this grant at a valuation determined in accordance with the provisions of the general law now in effect. Section 20. EMERGENCY CLAUSE. The ordinance approving this Agreement shall be declared to be an emergency measure on the ground of urgent public need for the preservation of peace, health, safety and 1-Mv537190,1 11 property and the requirement of reading such ordinance on two separate days shall be dispensed upon approval by the City Commission in accordance with applicable law. Section 21. LONG TERM AGREEMENT. The execution of this Agreement by the City and the Franchisee is not, and shall not be construed as, an acceptance by either party of any of the terms of this Agreement in the long-term franchise agreement to be negotiated between the City and the Franchisee. Section 22. SEVERABILITY. If any section, sentence, clause, phrase, or word of this Agreement is for any reason held or declared to be unconstitutional, inoperative or void, such holding or invalidity shall not affect the remaining portions of this Agreement; and it shall be construed to have been the intent of the City Commission to approve this Agreement without such unconstitutional, invalid, or inoperative part therein; and the remainder of this Agreement after the exclusion of such part or parts shall be deemed and held to be valid as if such parts had not been included therein. IN WITNESS WHEREOF, the City and the Franchisee have executed this Non - Exclusive Franchise Agreement on the respective dates set forth below. ATTEST: CITY OF MIAMI Priscilla A. Thompson City Clerk Approved as to form and correctness: Jorge L. Fernandez City Attorney By: Name: Joe Arriola Title: City Manager Date: 2004 Approved as to Insurance Requirements Dania Carrillo, Risk Management Administrator WITNESS: NUI UTILITIES, INC., d/b/a NUI City Gas Company of Florida 1-MI/537190,1 12 Witness to sign above Print Name: By: Name: Title: Date: , 2004 l-MI/537190.1 13