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HomeMy WebLinkAbout93-219 - ResolutionsRESOLUTION NO. 93-219 A RESOIg3TION OF THE CITY GOUNCIL OF THE CITY OF ~ ~, CAT.TFC~NIA, APPBGVING (I) THE S~T.~. BY SOUiT C~RT~. OC~3NICATIONS, INC. OF ITS CABLE TR~RVISION SYSTEM TO DCA CABLEVISION, (II) THE CANC~=ATION OF T~AT ~ FRANC~{ISE AG~~ DA~fD API~TL 17, 1985 BY AND ~ ~HE CITY AND SOUIT CABLE CCg~K~ICATIONS, INC., AND (III) MANAGING CqD~f~RAL PARrNq~R OF DCA CAMIAVISION WHfREAS, DCA ~blevisio~, a California general partnership ("DCA"), owns and operates a cable television system (the "DCA Syste~") in the city of Rancho O~monga, California (the "Cit~') pursuant to that certain cable television franchise agreement dated April 17, 1985 heretofore entered into by and between the City and DCA (the "DCA Franchise"); WHEREAS, Scott Cable C~,m~nications, Inc., a Tewm.~ corporation ("Scott Cable"), bas for more than three years owned and operated - and continues at the date hereof to own and operate - a cable television s~ (tb~ "Scott Cable System") in the City pursuant to that certain cable television franchise agre~m~_nt dated April 17, 1985 heretofore entered into by and between the City and Scott Cable (the "Scott Cable Franchise"); WHEREAS, DCA and Scott Cable have notified the City that Scott Cable desires to sell and transfer to DCA - and DCA desires to purchase - the Scott Cable System, subject to obtaining the City's consent thereto; R~EREAS, for purposes of convenienoe of operation, DCA desires - upon DCA's purcba.~e of the Scott Cable System - (i) to consolidate the operation of the Scott Cable System and the DCA System under one franchise, that being the DCA Franchise and (ii) to have the Scott Cable Franchise canoelied; R~EREAS, Scott Cable is willing to consent to the cancellation of the Scott Cable Franchise effective upon the closing date (the "Closing Date") of the sale of the Scott Cable System to DCA; WHEREAS, effective upon the Closing Date, DCA desires to appoint The Marks Group, Inc., a Delaware corporation ('~I") controlled by William J. Marks, to be the managing general partner of DCA, in plaoe of DCA's current managing general partner, West Coast Cable Partners, Ltd., a Califcxnia limited tkartnership ('SqCCP") which is also controlled by William J. Marks; WHEREAS, the city is willing to consent to the foregoing sale of the Scott Cable System to DCA and, effective upon the Closing Date, the cancellation of the Scott Cable Frand~ise and the appointment and substitution of MGI for and in place of WCCP as the managing general partner of DCA; and WHEREAS, all legal preconditions to the adoption of this Resolution have been fulfilled; Resolution No. 93-219 Page2 NOW, TMRRF-~RE, BE IT RESOLVED by the city Council of the city of Rancho CUcamonga that: 1. In all respects, as set forth in the Recitals, Part A. 2. On the basis of the oral ar~ written testimony presented to the City Council by DCA, Scott Cable and the City staff, which testimony is hereby inoorporated herein by reference as if fully set forth herein, the City Council concludes that, pursuant to Section 7.01.100B of Title 7 of the Rancho Cucamonga Municipal Omde, it has been demonstrated to the satisfaction of the City Ommcil that, with respect to both DCA's substitution of M~I in place of WCCP as DCA's managing general tk3rtner: A® No person with a defined interest in DCA, includir~ DCA's officers, directors, employees, prospective principals or those with either a legal or equitable interest in five (5) percent or more of DCA's voting stock: (i). Ham been convicted or held liable for acts involving moral turpitude or is presently under an indictment, investigation or cc~plaint charging such acts; (ii). Main ever had a judgment or an action for fraud, deceit or misrepresentation entered against such person(s) by a court of competent jurisdiction; or (iii). };as pending any legal claim, lawsuit or administrative proceeding arising out of or involving a cable system. Be The financial statements auclited, certified and qualified by an independent certified public accountant show that DCA will, upon ar~ immediately after its acquisiton of the Scott C~_ble S~, be finar~ially solvent. Ce DCA will have a~o~riate financial and technical capabilities to enable it to maintain and operate both the DCA System and the Scott Cable System for the remainder of the term of the DCA 3. The City, after due comsideration, hereby consents to and approves (i) Scott Cable's sale and transfer, and DCA's purchase, of the Scott ~ble System, (ii) from and after the Closing Date, DCA's ownership and operation of the Scott ~_ble ~, together with the DCA System, under the DCA Frand~ise, (iii) effective upon the Closing Date, the appointment and substi~c~ of M~I for and in place of WCCP as the managing general partner of DCA, and (iv) effective upon the Closing Date, the cancellation and _~_b~ogation of the Scott Cable Franchise ~rovided that Scott Cable shall be and remain liable to the City for any and all f~se fees that would have ~ due and payable to the City under the Soott Cable Franchise for the Resolution No. 93-219 p e3 period January 1, 1993 to and including the Closing Date (the "Pre- Cancellation Franchise Fees") but for the cancellation of the Scott Cable Franchise (and subject to DCA's obligation to be liable to the City therefor in the event of Scott Cable's default therec~); and f~r such purpose the City "Consent") heretofore suk~itted to the City by DCA and Scott ~able, a c~py of which Gonsent is annexed hereto as Exhibit A an~ the terms and provisions of 4. The City Council authorizes the City Manager or his desi~ to execute and deliver the Oonsent to Scott Cable in a f~rm substantially s~m{ lar to Attachment A hereto. 5. In the event that DCA does not purchae ar~ a~quire the Scott Cable ~ on the Closin~ Date, as ~ herein, then this Besolution shall term{hate and oease to be of a~y furthat f~x~e or effect, without further act of the City Council, and the DCA FranGb~e and the Soott Cable Franchise shall in that event continue in full f~rce and effect. 6. The City Clerk shall certify to the adoption of this Resolution. PASSfD, APPROV~D, and ADOPlOD this 17th day of November, 1993. NOES: None ABSf:~T: Buquet D~__b~a J. ~m~, City Clerk Dennis L. Stout, May~r I, DF~RA J. ADAMS, CITY ~.FRK of the City of Rancho Cu~, California, do hereby certify that the foregoing Resolution was duly pm.~d, approved, and adopted by the City Council of tb~ City of Rancho O~amnnga, California, at a regular meeting of said City Council held on the 17th day of November, 1993. Executed this 18th day of November, 1993, at P~ncho C~, California. J. _Ada_ ~, City Clerk Resolution No. 93-219 Page4 THE CITY OF RANC~0 (~_a/~GA, CALIFC~U_A SAT.R OF CABLE T~RVISIC~ SYSTEM, CANC~_ .~ATION OF CABLE T~.w~/SI~ DESI6~TI~N OF NE~ MANAGING G~9~%%L PARTNq~ THIS CONS~T, effective as of the Closing Date referred to in the closing paragr~_?h hereof, amor~ Scott Cable O0~mmi~t/o~s, I~o., a Tex~s 0o~olatio~ ("Scott Cable"), DCA C,h~tViSi~n, a California general part~ ("DCA") and the City of Rancho Cueamong&, California (the "City"), W! TNE~ SETH: WH~Y~S, DCA owns and operates a cable televisic~ system (the "DCA System") in the City pursuant to that oertain cable televisic~ franchise agreement dated April 17, 1985 heretofore entered into by and between the City and DCA (the "DCA Franchise"); WHEREAS, Scott Cable has for more than three years owned and operated, and continues at the date hereof to ~wn and operate, a cable television system (the "Scott Cable Systsm") in the City pursuant to that certain cable television franchise agreement dated April 17, 1985 heretofore entered into by and bet~_n the City and Soott Cable (the "Scott Cable Franchise"); WHEREAS, DCA and Scott ~ble have notified the City that Scott Cable desires to sell and transfer to DCA - and DCA desires to purcb~-~e - the Scott Cable S~, subject to obtaining the City's consent thereto; %~Y~%S, for purposes of convenience of operation, DCA desires - upon DCA's purcba.~e of the Scott Cable S~ - to consolidate the operation of the Scott Cable S~ and the DCA System under one franchise, that being the DCA Franchise, and to have the Scott Cable Franchise cancelled, and Scott Cable is willing to consent to the cancellation thereof; WHEREAS, Scott Cable is willing to consent to the cancellation of the Scott Cable Franchise effective upon the closing date (the "Closing Date") of the sale of the Scott (~_ble System to DCA; WHEREAS, effective upon the Closing Date, DCA desires to appoint The Marks Group, Inc., a Delaware corporation ('~I") controlled by William J. Marks, to be the managing general partner, West COast Cable Partners, Ltd., a Califcx~ia limited partnership ('~CCP") which is also controlled by William J. Marks; and WH~F2~S, pursuant to Resolution 93-219 adopted by the City Council of the City of Rancho O]cA~n~a, the City is willing to consent to the foregoing sale of tb~ Scott ~ble System to DCA and, effective upon the Closing Date, the canoellation of the Scott Cable Franchise and the appointment and substitution of MGI for and in place of WCCP as the managing general partner of DCA; Resolution No. 93-219 P e5 NC~, THEREFORE, in consideration of the premises, it is hereby agreed as follows: Effective the Closing Date, (i) DCA hereby agrees that the term "syste~" (as used in the DCA Franchise) shall be deemed to refer to both the DCA Syste~ and the Scott Cable System, and that DCA's ownership and operation of each of said two systems shall in all respects be subject to and governed by the terms and provisions of the DCA ~se, provided that - for purposes of calculating DCA's 1993 franchise fees payable with respect to the Scott Cable Sy~cem- DCA shall not have any obligatic~ to the City for any Pre- Cancellation Franchise Fees (as such term is defined below) theretofore paid to the City by Soott Cable, and (ii) DCA hereby consents to the cancellation and abrogation of Scott Cable Franchise by the City and Scott Cable. Effective the Closing Date, Scott Cable hereby consents to the cancellation and ak~ogation of the Scott Cable Franchise (and the Scott Cable Franchise is hereby cancelled and a__brogated effective the Closing Date), provided that Scott Cable does hereby further agree to be and remain liable to the City for t/he payment of any and all franchise fees that would have beccm~ due and payable to the City under the Scott C~_ble Franchise for the period January 1, 1993 to and including the Closing Date (the "Pre-Cancellation Franchise Fees") but for the foregoing cancellation of the Scott Cable Franchise. Scott C~_ble hereby covenants to pay the Pre-Cancellation Franchise Fees to the City within 45 days after the Closing Date. In the event that Scott Cable shall fail to pay any or all of the Pre-Canoellation ~se Fees to the City within 45 days after the Closing Date, DCA shall be liable therefor and shall in that event pay to the City, within 90 days after the Closing Date, any and all Pre-Cancellation Franchise Fees not theretofore paid to the City by Scott Cable. e The City, after due consideration, hereby (i) consents to and ap~xoves Scott C~__ble's sale and transfer to DCA - and DCA's purdmase - of the Scott C~_ble Syste~, (ii) agrees that, effective the Closing Date, the term "system" (as used in the DCA Franchise) shall be an~ that DCA's c~nex~p and cgeration of such two systsms shall in all respects be subject to and governed by the terms and provisions of the DCA Franchise, (iii) agrees that, effective upon the Closing Date, the Scott Cable Franchise shall be (and, effective the Closing Date, it is hereby) cancelled and ak~ogated, provided that - notwithstandin~ such cancellation - Scott Cable shall be and re~ain liable to the city for the payment of the Pre-Cancellation Franchise Fees (and shall pay sc~e to the City within 45 days after the Closing Date) pursuant to paragraph 2 hereof, (iv) consents, effective upon the Closing Date, to the appointment and substitution of ~I for and in place of WCCP as ma~ naging general partner of DCA, and (v) agrees that DCA may, at any time and frc~ time to time, grant or otherwise ~,olutia~ No. 93-219 including the DCA System and the Scott Cable ~ and DCA's rights and privileges under the DCA ~, to any bank(s) or other lender(s) provid/ng financ/ng to DCA fr~m time to time, and that such bank(s) and lender(s) shall have the right to enf~roe any such lie~ and security interests and to take title, control and/or po~sic~ to or of the respective collateral subject ~ u~xm prior writte~ notioe to the City but without having to obtain the City's oo~sent control of and operate (as such terms are used in Secti~ 7.02.100C of the Rancho O~v~3a ~nicipal Code) either the DCA System or the Scott ~ble Syste~ for a period of ~-_-~ than c~e year, or sell or (oth~ than in the ~Uinary ~ of ~us~), without fir~ unreasonably withhold). IN WITNESS WH~R~DF, the parties hereto have caused this Cu~sent to be duly executed, effective as of the Closing Date (such date being that date first set forth _ur~e__~r Scott Cable's signature below). Name: Title: , 1993 DCA CABLEVISION as its general partner City Clerk Title R~solution No. 93-219 Page7 SCOTT C~%BLE COIOIUNICATIONS, INC. Bruce A. President , 1993 (the "Closing Date")