HomeMy WebLinkAboutOrdinance No. 06-1996ORDINANCE NO. 06-96
AN ORDINANCE OF THE CITY OF CAPE CANAVERAL, FLORIDA
GRANTING A CORPORATE FIBER OPTICS NETWORK NON-
EXCLUSIVE FRANCHISE TO KMC TELECOM, INC. AND
AUTHORIZING THE USE OF THE PUBLIC STREETS AND RIGHTS OF
WAY OF THE CITY OF CAPE CANAVERAL, FLORIDA FOR THE
PURPOSE OF CONSTRUCTING, MAINTAINING AND OPERATING A
FIBER OPTIC NETWORK THEREON AND THEREUNDER; PROVIDING
FOR APPROVAL AND EXECUTION OF A WRITTEN AGREEMENT
BETWEEN THE CITY OF CAPE CANAVERAL AND KMC SOUTHEAST
CORP. WHICH SHALL SET FORTH THE TERMS AND CONDITIONS
OF THE FRANCHISE; PROVIDING FOR SEVERABILITY; PROVIDING
FOR REPEAL OF PRIOR INCONSISTENT ORDINANCES AND
RESOLUTIONS; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, pursuant to the Municipal Home Rules Posers Act, Section 166.011,
Florida Statutes, et. seq., the City of Cape Canaveral, Florida has been granted
governmental, corporate, and proprietary powers to enable them to conduct municipal
government, perform municipal functions, and render municipal services, except as
otherwise provided by law; and
WHEREAS, the granting of a non - exclusive fiber optic telecommunications
franchise is not prohibited by the Constitution, general law, or Brevard County Charter;
and
WHEREAS, due to the growth and development of the telecommunications
industry, there will be increasing demand for high - quality, high- capacity, and reliable fiber
optic networks for purposes of transmitting an intensive volume of data, video, and voice
transmission; and
WHEREAS, the City Council of the city of Cape Canaveral believes that this
franchise shall serve as a foundation to support the future telecommunication demands of
the City's corporate citizens; and
WHEREAS, after conducting an advertised hearing, the City Council of the City of
Cape Canaveral has found that it will promote the public health, safety, and welfare of the
citizens of Cape Canaveral to approve the franchise agreement with KMC Telecom, Inc., a
Delaware Corporation. A copy of the agreement is attached hereto as Exhibit "A ".
NOW THEREFORE, BE IT ENACTED by the City Council of the City of Cape
Canaveral, Florida:
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City of Cape Canaveral, Florida
Ordinance No. 06 -96
Page Two
Section 1. Franchise established. The City Council of the City of Cape Canaveral does
hereby approve the franchise agreement between the City of Cape Canaveral and KMC
Telecom, Inc., a Delaware Corporation for the period , 1996 to
2006, a copy of the franchise agreement is attached hereto as Exhibit "A" and said agreement is
incorporated herein by reference. The agreement shall be executed by both parties in duplicate,
and the Mayor is hereby authorized to execute said agreement on behalf of the City.
Section 2. Severability Clause. In the event that any term, provision, clause, sentence or
section of this Ordinance shall be held by a court of competent jurisdiction to be partially or
wholly unenforceable or invalid for any reason whatsoever, any such invalidity, illegality, or
unenforceability shall not affect any of the other or remaining terms, provisions, clauses,
sentences, or sections of this ordinance, and this Ordinance shall be read and/or applies as if the
invalid, illegal, or unenforceable term, provision, clause, sentence, or section did not exist.
Section 3. Incorporation into Code. This ordinance shall be incorporated into the City
Code Appendix A Franchises of the City Code, as Article VI. Fiber Optics Communications,
and any section or paragraph number or letter and any heading may be changed or modified as
necessary to effectuate the foregoing.
Section 4. Effective Date. This Ordinance shall take effect immediately upon being adopted
by the City Council of the City of Cape Canaveral.
ADOPTED BY the City Council of the City of Cape Canaveral, Florida, this 18th day of
June, 1996,
ADTTE6s
ATTEST:
Council of the City of Cape Canaveral, , �:-: ' 18th day o_ � 996.
Sandra 01\ Sum, CITY CLERK
%'x)47
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cityclklordinanc\frncbsfibercopt
ohn K. Porter, MAYOR
NAME
BRUNS _ ABSENT
NICHOLAS
PETSOS .X_
PORTER X
FOR
RANDELS X
First Reading: 6/4/96
Posted: 6/5/96
Published: 6/7/96
Second Reading: 6/18/96
AGAINST
Ord. No. 06-1996
Exhibit "A"
CORPORATE
FIBER OPTICS NETWORK FRANCHISE AGREEMENT
THIS AGREEMENT is made and entered into as of this /61' day of , ,'E' , 1996,
by and between the CITY OF CAPE CANAVERAL, a Florida Municipal Corporation
("City"), and KMC TELECOM INC., a Delaware Corporation ("KMC").
RECITALS:
WHEREAS, the City is authorized to grant one or more non-exclusive, revocable
franchises to construct, reconstruct, operate, and maintain a fiber optic based telecommunications
system ("Fiber Optic Network") within the City; and
WHEREAS, the City finds it in the public interest to make available within its corporate
limits a high-quality, high-capacity, and reliable Fiber Optic Network for large and specialized
corporate users with intensive telecommunications needs; and
WHEREAS, the City finds it in the public interest to retain regulatory authority over the
Fiber Optic Network, to the extent allowed by law, because of the overriding public health,
safety and welfare considerations associated with utilizing City Rights-of-way; and
WHEREAS, the City finds it in the public interest to retain control over the use of
public rights-of-way by providers of a Fiber Optic Network to prohibit interference with the
public convenience, to promote aesthetic considerations, to promote planned and efficient use
of limited right-of-way space, and to protect the public investment of right-of-way property; and
WHEREAS, the City finds it in the public interest to ensure that a high quality Fiber
Optic Network is maintained through a responsive customer service procedure; and
WHEREAS, the City finds that the granting of a non-exclusive Fiber Optic Network
franchise is the best means of assuring that the above described interests of the City of Cape
Canaveral are promoted and maintained; and
WHEREAS, the City, after public hearings and due evaluation and deliberation, has
determined that it is in the best interests of the public health, safety and welfare of the City and
its residents to approve this Fiber Optic Network Franchise Agreement with KMC.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained
herein, the parties mutually agree as follows:
I. RECITALS.
• Ord. No. 06-1996
Exhibit"A"
1.1 Recitals Incorporated. Each and all of the foregoing recitals are hereby
incorporated herein and acknowledged to be true and correct. Failure of any of the foregoing
recitals to be true and correct shall not operate to invalidate this Agreement.
II. SHORT TITLE.
2.1 This Agreement shall be known and may be cited as "Cape Canaveral
Corporate Fiber Optic Network Franchise".
III. PURPOSE AND GOALS.
3.1 Purpose.
The City finds that the development of a Fiber Optic Network, for large
and specialized corporate customers with intensive telecommunications needs, has the potential
of having great benefit and impact upon the people of the City. The City further finds that the
public convenience, safety and general welfare can best be served by exercising regulatory
powers which are vested in the City or such persons as the City shall designate. It is the intent
of this Agreement and subsequent amendments thereto to provide for and specify the means to
attain the best possible public interest and public purpose in the provision of a Fiber Optic
Network within the boundaries of the City, and this finding shall be an integral part of this
Agreement.
3.2 Goals.
For these purposes, the following goals underlie the regulations and
provisions contained herein:
(a) Ensure the near term availability of a low cost, high-quality,
dedicated Fiber Optic Network to the City's Corporate Subscribers.
(b) The Fiber Optic Network should be capable of accommodating both
the current and reasonably foreseeable future telecommunications needs of the City's Corporate
Subscribers.
(c) The Fiber Optic Network should be periodically improved and
upgraded if necessary during the franchise term so that the new facilities necessary for the
operation of this system shall be integrated to the maximum extent possible with existing
facilities.
(d) The City shall be provided access to and use of the Fiber Optic
Network at KMC's sole cost and expense.
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IV. DEFINITIONS.
For the purpose of this Agreement, the following terms and words shall have the
meaning ascribed to them, unless the context clearly indicates otherwise:
4.1 "Agreement" or "Franchise" shall mean this Franchise Agreement, as
amended from time to time, which shall constitute an initial authorization, voluntarily entered
into by KMC and granted by the City, for the purpose of providing KMC authorization to
construct or operate a Fiber Optic Network in the Franchise Area. Any such authorization, in
whatever form granted, shall not mean or include any license or permit required for the privilege
of transacting and carrying on a business within the City as required by other City Code
provisions or resolution.
4.2 "City" means the City of Cape Canaveral, a Florida Municipal
Corporation, its successors and assigns.
4.3 "Corporate Subscriber" means a commercial (non-residential) Customer
of KMC with intensive telecommunication needs involving data, video, and voice transmission
over the Fiber Optic Network.
4.4 "KMC" means KMC TELECOM INC., a Delaware Corporation, and its
successors and assigns.
4.5 "Franchise Areas" means all of the territory within the incorporated City,
and such additional territory as may be from time to time annexed into the City.
4.6 "Gross Annual Revenue" means all receipts derived directly or indirectly
from the operation of the Fiber Optic Network in the Franchise Area. Gross Annual Revenue
does not include any taxes imposed and/or assessed by law to Corporate Subscribers.
4.7 "Fiber Optic Network" shall mean KMC's system of cables, wires, lines,
towers, wave guides, optic fiber, microwave, laser beams, and any associated converters,
equipment, facilities, or other related appurtenances designed and constructed for the purpose
of producing, receiving, amplifying, or distributing telecommunications, by audio, video, or
other forms of electrical signals to or from Corporate Subscribers or locations within the City.
4.8 "Public Right-of-Way" means the surface, the air space above the surface,
and the area below the surface of any public street, sidewalk, bridge, waterway, utility
easement, or other public property, which shall entitle the City and KMC to the use thereof for
the purpose of installing and maintaining KMC's Fiber Optic Network. No reference herein,
or in any Franchise, to the "Public Right-of-Way" shall be deemed to be a representation or
guarantee by the City that its title to any property is sufficient to permit its use for such purpose,
and KMC shall, by its use of such terms, be deemed to gain only such rights to use property in
the City as the City may have the undisputed right and power to give.
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4.9 "Transfer" means the disposal by KMC, directly or indirectly, by gift,
assignment, voluntary sale, merger, consolidation or otherwise, of twenty percent(20%)or more
at one time of the ownership or controlling interest in the Fiber Optic Network, or over fifty
percent (50%) cumulatively over the term of the Franchise of such interests to a corporation,
partnership, limited partnership, trust or association, or person or group of persons acting in
concert or a change in control. Transfer shall not include any transfer or assignment to a person
controlling, controlled by, or under the same common control as KMC.
V. GRANT OF FRANCHISE.
5.1 Grant of Franchise. KMC is hereby granted a Corporate Fiber Optic
Network Franchise, subject to the terms and conditions of this Agreement. Pursuant to this
Franchise, KMC may construct, operate, and maintain a Fiber Optic Network in, under, over,
along, across or upon the Public Rights-of-Way within the City for the purpose of producing,
receiving, amplifying, or distributing, by audio, video, or other forms of electrical signals to or
from Corporate Subscribers or locations within the City.
In exercising rights pursuant hereto, KMC shall not endanger or interfere
with the lives of persons, interfere with any structures, buildings, or facilities of the City, any
public utility, or any other person permitted to use the Public Rights-of-Way, nor unnecessarily
hinder or obstruct the free use of the Public Rights-of-Way. The grant of this Franchise does
not establish priority for use over other present or future permit, license, or utility franchise
holders or the City's own use of the Public Rights-of-Way.
All rights granted for the construction, reconstruction, maintenance, and
operation of Fiber Optic Network shall be subject to the continuing right of the City to require
such reconstruction or relocation of the Fiber Optic Network in the Public Rights-of-Way as
shall, at the sole discretion of the City, be in the public interest.
5.2 Franchise Not Exclusive. The grant of this Franchise shall be
non-exclusive and shall not affect the right of the City to grant to itself or any other person the
right to: build, operate, or own a Fiber Optic Network; occupy or use the Public Rights-of-Way
for the construction, reconstruction, maintenance, and operation of a Fiber Optic Network or
for any purpose whatsoever. No privilege or power of eminent domain is bestowed on KMC
by the grant of this Franchise.
5.3 Event of Conflict. In the event of conflict between the terms and
conditions of the City Code and this Agreement, this Agreement shall control. In all events,
however, KMC shall comply with all laws, ordinances and regulations enacted by the City
pursuant to its lawful police and regulatory powers as authorized by law. This Franchise is
hereby made subject to the general City Code provisions now in effect and hereafter made
effective. Nothing in the Franchise shall be deemed to waive the requirements of the various
codes of the City regarding permits, taxes, fees to be paid, or manner of construction.
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Exhibit "A"
VI. EFFECTIVE DATE OF FRANCHISE; TERM.
6.1 Effective Date. The effective date of this Franchise shall be
6.2 Term. The term of this Franchise shall be for a period of five (5) years
from the effective date unless sooner terminated as provided for in this Agreement. The
Franchise shall expire on . At the commencement of the fourth (4th)
year of this Franchise, KMC shall have the right to begin negotiating the terms and conditions
of a new Fiber Optic Network franchise agreement with the City, providing KMC has favorably
performed the terms and conditions of this Franchise to the City's satisfaction. If the parties
agree on a new franchise, the effective date of the new franchise shall be upon the expiration
of this Franchise.
VII. FRANCHISE OPERATION.
7.1 Use of Public Rights-of-Way. For the purpose of operating and
maintaining a Fiber Optic Network in the Franchise Area, KMC may erect, install, construct,
repair, replace, reconstruct and retain in, on, over, under, upon, across and along the public
streets and Rights-of-way within the Franchise Area such cables, equipment, and facilities as are
necessary to the operation of the Fiber Optic Network; provided, however, that KMC complies
with all design, construction, safety, and performance provisions contained in this Agreement,
applicable local ordinances, and state and federal law.
7.2 Right of Condemnation Reserved. Nothing herein shall limit any right
the City may have to acquire by eminent domain or otherwise any property of KMC; provided,
however, that any such acquisition shall be for a price that values KMC's property as allowed
by law.
7.3 City's Right to Perform Public Works. Nothing in this Agreement shall
be in hindrance to the right of the City or any governmental authority to perform or carry on,
directly or indirectly, any public works or public improvements of any description. Should the
Fiber Optic Network in any way interfere with the construction, maintenance or repair of such
public works or public improvements, KMC shall, at its own cost and expense, protect or
relocate its Fiber Optic Network, or part thereof, as reasonably directed by the City officials or
any governmental authority.
7.4 Emergency Removal of Network. If at any time, in case of fire,
emergency, or disaster in the City, it shall become necessary in the reasonable judgment of the
City to move any part of the Fiber Optic Network, the City shall have the right to do so at the
sole cost and expense of KMC. However, the City shall make all reasonable efforts to contact
KMC prior to moving any part of the Fiber Optic Network, and, if possible, in the City's
reasonable discretion, to allow KMC to perform any moving of the Fiber Optic Network, or
parts thereof. KMC shall bear all costs of reinstallation, repair, and other costs resulting from
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Ord. No. 06-1996
Exhibit "A"
or arising out of the emergency removal of the Fiber Optic Network; provided, however that
in the event it is determined that an emergency, fire, or disaster did not exist then the cost of
such removal and reinstallation shall be borne by the City. The City shall be liable for bodily
injuries or property damage arising as a result of its acts of omissions when the City moves the
Fiber Optic Network, or any parts thereof.
7.5 Removal or Abandonment. Upon termination of the Franchise, at the
request of the City, KMC shall remove its Fiber Optic Network from the Public Rights-of-Way
and shall restore any property, public or private, to its original condition prior to the installation,
erection, or construction of the Fiber Optic Network. Restoration of City property, including,
but not limited to, the Public Rights-of-Way, shall be in accordance with the directions and
specifications of all affected departments and agencies of the City, and all applicable law. KMC
shall accomplish such restoration at its expense. If such removal and restoration is not
completed within twelve (12) months after notice by the City delivered in writing to the KMC,
all of the KMC's property remaining in the affected Public Rights-of-Way shall, at the option
of the City, be deemed abandoned and shall, at the option of the City, become the property of
the City. In the event KMC fails or refuses to remove its system or to satisfactorily restore all
areas to as reasonably as close of condition in which they existed prior to the original
construction of the system, the City, at its option, may perform such work and collect the cost
thereof from KMC.
7.6 Time Is of the Essence. Whenever this Agreement shall set forth any time
for any act to be performed by or on behalf of KMC, such time shall be deemed to be of the
essence, and any failure of KMC to perform within the time allotted shall be sufficient ground
for the City to invoke any applicable provision of the City Code or this Agreement.
7.7 No Waiver of Rights. No course of dealing between KMC and the City
nor any delay on the part of the City in exercising any rights hereunder shall operate as a waiver
of any such rights of the City or acquiescence in the actions of KMC in contravention of the
City's rights, except to the extent expressly waived by the City in writing or expressly provided
for in the Franchise.
VIII. TRANSFER OF OWNERSHIP OR CONTROL.
8.1 Transfer of Franchise. This Franchise shall not be sold, Transferred,
leased, assigned or disposed of, including but not limited to, by forced or voluntary sale,
merger, consolidation, receivership or other means without the prior written consent of the City,
and then only under such reasonable conditions as the City may establish which may include but
not be limited to financial guarantees to the Fiber Optic Network.
8.2 Transfer Threshold. KMC shall promptly notify the City of any actual
or proposed change in, or Transfer of, or acquisition by any other party of, control of KMC.
8.3 City Approval. Every change, Transfer, or acquisition of control of KMC
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shall make the Franchise subject to cancellation unless and until the City shall have consented
thereto in writing. For the purpose of determining whether it may consent to such change,
Transfer, or acquisition of control, the City may inquire into the legal, financial, character,
technical, and other public interest qualifications of the prospective Transferee or controlling
party, or of the terms and conditions of the proposed change, transfer, or acquisition of control,
and KMC shall assist the City in obtaining all required information. Failure to provide all
reasonable information requested by the City as part of said inquiry shall be grounds for denial
of the proposed change, Transfer or acquisition of control.
8.4 Signatory Requirement. Any approval by the City of Transfer of
ownership shall be contingent upon the prospective assignee becoming a signatory to the
Franchise.
IX. FRANCHISE FEES.
9.1 KMC shall pay to the City a Franchise Fee of five percent (5.0%) of the
Gross Annual Revenues excluding bad debts, taxes and fees collected by KMC on behalf of any
governmental agency.
9.2 Franchise Fees in Addition to Other Taxes or Payments. Payment of
the Franchise Fee made by KMC to the City shall not be considered in the nature of a tax, but
shall be in addition to any and all taxes of general applicability which are now or may be
required hereafter to be paid by any Federal, State, or local law.
9.3 Acceptance by the City. Subject to applicable law, no acceptance of any
payment by the City shall be construed as a release or as an accord and satisfaction of any claim
that the City may have for further or additional sums payable as a Franchise Fee under this
Agreement or for the performance of any other obligation of KMC.
9.4 Failure to Make Required Payment. In the event that any Franchise Fee
or recomputed amount is not made on or before the dates specified herein, KMC shall pay as
additional compensation an interest charge, computed from such due date, at an annualized rate
equal to the commercial prime interest rate of the City's primary depository bank during the
period that such unpaid amount is owed.
9.5 Periodic Payments to Be Made. KMC shall make fee payments of
monies due hereunder within thirty (30) days of the end of each calendar quarter for Franchise
Fees collected during the preceding quarter. Accompanying said payment, KMC shall also
provide a written report of its gross revenues generated in the Franchise Area for the preceding
quarter's period.
9.6 City Right to Inspection. The City, at its discretion, shall have the right
to inspect KMC's gross revenue records, to audit, and to recompute any fee amounts.
Inspections, audits or recomputations may be performed either by the City or an independent
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• Ord. No. 06-1996
Exhibit "A"
firm selected by the City and qualified for such purposes. No audit of KMC's records relating
to Gross Annual Revenues shall take place later than thirty-six (36) months following the close
of each of KMC's fiscal years. Audits that result in payment of four percent (4%) or more of
Franchise Fees during the audit period, shall be at the expense of KMC. Any additional amount
due to the City as a result of the audit shall be paid within thirty (30) Days of notice by the City,
unless KMC disputes the results of the audit. KMC agrees to meet with the City and will
attempt in good faith to resolve any differences. Thereafter, the additional amount due shall be
subject to payment within thirty (30) days after said additional amount is determined to be due
by KMC and the City, or the City declares an impasse in the negotiations with KMC.
9.7 Payments Due in Event of Termination or Expiration. In the event that
KMC continues the operation of any part or all of the Fiber Optic Network beyond the
termination, revocation, or expiration of the Franchise granted herein, it shall continue to pay
to the City the Franchise Fee in the manner set forth in this Agreement. This section shall not
be construed to authorize the operation of the Fiber Optic Network beyond the termination,
revocation, or expiration of this Franchise.
9.8 Alternative Fee Contingencies. In the event that KMC's obligation to pay
a Franchise Fee is held invalid by a decision of any court of competent jurisdiction or due to the
actions of any legislative body, KMC shall negotiate with the City in good faith and shall agree,
if permissible under then applicable law, to provide compensation to the City in lieu of the
Franchise Fee. The amount of compensation shall, to the extent permitted by applicable law,
as amended from time to time, be comparable to that which KMC would pay as the Franchise
Fee under the terms of this Agreement and shall be passed through to the Corporate Subscriber
in a manner similar to the Franchise Fee.
9.9 Other Fees and Taxes. To the extent that any federal or state law or
regulation may now forbid the City from assessing any type of fee or tax, upon repeal,
modification, or judicial/administrative interpretation of said law or rule that would permit the
City to assess said fee or tax, the City shall have the right to assess said fee or tax to the full
extent authorized by law; provided, that the City shall first consult with KMC. Upon such
occurrence, the parties shall meet and confer within ninety (90) Days of notice from the City
to in good faith negotiate Franchise provisions to implement the collection of said fee or tax.
X. FORFEITURE OR REVOCATION.
10.1 Grounds for Revocation. The City reserves the right to revoke any
Franchise granted hereunder and rescind all rights and privileges associated with the Franchise
in the following circumstances, each of which shall represent a default and breach of this
Agreement:
(a) KMC has defaulted in the performance of any of the material
obligations under this Agreement or the City Code;
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Exhibit "A"
(b) KMC has failed to provide or maintain in full force and effect the
liability and indemnification coverage as required herein;
(c) KMC has violated a material provision of any orders or rulings of
any regulatory body having jurisdiction over KMC relative to this Agreement and any regulatory
ordinance of the City, and KMC fails to begin cure within five (5) business days of notice from
the City and to complete cure within a reasonable time after notice, as determined by the City;
(d) KMC has committed any act of fraud upon the City or Corporate
Subscriber(s);
(e) KMC has acted gross negligently, as defined by general and
applicable law, in maintaining or operating the Fiber Optic Network provided in this Franchise;
(f) KMC has become insolvent, is unable or unwilling to pay its debts
or is adjudged bankrupt;
(g) KMC has made a material misrepresentation of fact in the
application for or negotiation of the Franchise or any extension or renewal thereof; and
(h) KMC has failed to pay the Franchise Fee in the manner provided
in this Agreement.
10.2 Effect of Circumstances Beyond Control of Franchisee. KMC shall not
be declared at fault or be subject to any sanction under any provision of this Agreement in any
case, in which performance of any such provision is prevented for reasons beyond KMC's
control. For the purposes of this Agreement, causes or events beyond KMC's control shall
include, without limitation, acts of God, floods, earthquakes, landslides, hurricanes, fires and
other natural disasters, acts of public enemies, riots or civil disturbances, sabotage, strikes and
restraints imposed by order of a governmental agency or court. A fault shall not be deemed to
be beyond KMC's control if committed by a corporation or other business entity in which KMC
holds a controlling interest whether held directly or indirectly, when such fault is due to KMC's
financial inability to perform or comply, economic hardship, or misfeasance, malfeasance or
nonfeasance by any of KMC's directors, officers, employees or contractors or agents.
10.3 Effect of Pending Litigation. Pending litigation or any appeal to any
regulatory body or court having jurisdiction over KMC shall not excuse KMC from the
performance of its obligations under this Agreement, unless specifically provided for by court
order or by the regulatory body having jurisdiction over such matters. Failure of KMC to
perform such obligations because of pending litigation or petition may result in forfeiture or
revocation pursuant to the provisions of this section.
10.4 Procedure Prior to Revocation. The City shall notify KMC in writing
of the exact nature of the alleged violation constituting a ground for termination and give KMC
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Exhibit "A"
thirty (30) days, or such greater amount of time as the City may specify, to correct such
violations or to present facts and arguments to refute the alleged violation. If the City then
concludes that there is a basis for termination, it shall notify KMC thereof. If within the
designated time KMC does not remedy and/or put an end to the alleged violation, the City, after
a public hearing where all interested parties may be heard, may suspend or revoke the Franchise,
if it determines that such action is warranted. KMC shall not be held in default nor suffer any
penalties where non-compliance or default is caused by an event beyond KMC's control, as
stated in Section 10.2. KMC shall have the right to review by a court of competent jurisdiction
upon the City Council's determination of non-compliance.
XI. LIABILITY AND INSURANCE.
11.1 Certificate of Insurance. In no event later than sixty (60) days after the
effective date of this Agreement and thereafter continuously throughout the duration of this
Agreement and any extensions or renewals thereof, KMC shall furnish to the City, certificates
of insurance, approved by the City, for all types of insurance required under this section 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, operation, and maintenance of the Fiber Optic
Network, or any parts thereof within the Franchise Area. Failure to furnish said certificates of
insurance in a timely manner shall constitute a default of this Agreement pursuant to Paragraph
10.1 herein. At the City's request, KMC shall furnish certificates of insurance which are in
effect from time to time.
11.2 No Liability Limit. Neither the provisions of this article or any damages
recovered by the City hereunder, shall be construed to limit the liability of KMC for damages
under this Agreement.
11.3 Endorsement. All insurance policies maintained pursuant to this
Agreement shall contain an endorsement in substantially the following form:
It is hereby understood and agreed that this insurance policy may
not be modified or canceled by the insurance company nor the
intention not to renew be stated by the insurance company until
thirty (30) days after receipt by the City of Cape Canaveral City
Manager by certified mail, of a written notice of such intention to
cancel or not to renew.
11.4 State Institution and Rating. All insurance policies provided pursuant
to this Agreement shall be written by companies authorized by the Florida Insurance
Commissioner to do business in the State of Florida as an insurance company and having a
financial rating in Best's insurance Guide of AAA or better.
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11.5 Named Insured. The City and its officers, directors, employees and
agents shall be an additional named insured, as the City's interest may appear, for all insurance
policies written pursuant to this Agreement.
11.6 Changes in Policy Limits. To offset the effects of inflation and to reflect
changing liability limits, all of the coverage, limits, and amounts of the insurance provided for
herein are subject to reasonable increases at the end of every three (3) year period of this
Agreement, applicable to the next three (3) year period, at the City's discretion.
11.7 Commercial General Liability Insurance. KMC shall maintain
throughout the term of this Agreement, general liability insurance insuring KMC in the minimum
of one million ($1,000,000.00) each occurrence, five hundred thousand ($500,000.00) each
person claim and one million ($1,000,000.00) property damage each occurrence.
Such general liability insurance must include coverage for all of the following:
comprehensive form, premises operations, explosion and collapse hazard, underground hazard,
products/completed operations hazard, contractual insurance, broad form property damage, and
personal injury.
11.8 Automobile Liability Insurance. KMC shall maintain throughout the
term of this Agreement, automobile liability insurance for owned, non-owned, or rented vehicles
in the minimum amount of one million ($1,000,000.00) combined single limit liability for bodily
injury, consequent death, and property damage each occurrence; and
11.9 Worker's Compensation. KMC shall maintain throughout the term of
this Agreement, worker's compensation in the minimum amount of the statutory limit for
worker's compensation, as amended from time to time.
XII. INDEMNIFICATION AND HOLD HARMLESS.
12.1 Indemnity and Hold Harmless. City shall in no way be liable or
responsible for any accident or damage that may occur in the construction, operation or
maintenance by KMC of the Fiber Optic Network, and the acceptance of this Franchise on the
part of KMC shall be deemed an agreement on the part of KMC to fully indemnify, defend and
hold harmless the City and its officers, boards and council, contractors, and City employees
against the full amount of any (i) claims, (ii) liabilities, (iii) actions, (iv) suits, (v) proceedings,
(vi) payments, (vii) assessments, (viii) judgments, (ix) losses, (x) damages, (xi) costs and (xii)
expenses (including interest, penalties and reasonable attorneys' fees and disbursements) claimed
against the City in connection with the following:
(a) To persons or property, in any way arising out of the construction,
operation, or maintenance of the Fiber Optic Network or through the acts or omissions of KMC,
its servants, agents or employees; and
11
Ord. No. 06-1996
Exhibit "A"
(b) Arising out of KMC's failure to comply with the provisions of any
federal, state, or local laws, ordinances, or regulations applicable to KMC in its business
hereunder.
12.2 Condition. The foregoing indemnity is conditioned upon the City giving
KMC prompt notice of any claim or the commencement of any action, suit or other proceeding
covered by the provisions of this section. Nothing herein shall be deemed to prevent the City
from cooperating with KMC and participating in the defense of any litigation by its own counsel
at its own costs and expense.
XIII. DESIGN AND CONSTRUCTION PROVISIONS.
13.1 Authorization to Commence Construction and Application Procedures.
Prior to the installation or erection of the Fiber Optic Network, or any part thereof, or other
appurtenances thereto, except for minor or emergency excavation and maintenance, or the
upgrade or rebuild of the Fiber Optic Network, KMC shall first submit to the City for review
a concise description of the facilities proposed to be maintained, erected, removed, or installed,
including engineering drawings, if required by the City. No erection, excavation or installation
of any part of the Fiber Optic Network, or other appurtenances thereto, shall be commenced by
any person until proper permits have been received from the City, except in the event of an
emergency.
13.2 City Maps. The City does not guarantee the accuracy of any maps
showing the horizontal or vertical location of existing substructures or utilities.
13.3 Compliance with Construction and Technical Standards. KMC shall
install or erect the Fiber Optic Network or other appurtenances thereto, in accordance with
commonly accepted good engineering practices and technical standards. KMC shall comply with
all applicable construction and technical codes adopted by local, state, and federal law.
13.4 Quality of Construction. Construction, installation, reconstruction,
operation, and maintenance of the Fiber Optic Network shall be performed in an orderly and
workmanlike manner, in accordance with then current technological standards. KMC shall use
its best efforts to install or erect the Fiber Optic Network parallel with existing other utilities
located in the rights-of-way. Nothing herein shall preclude underground installation.
13.5 Underground Installation.
(a) All installations shall be underground in those areas of the City
where public utilities providing telephone, cable, and/or electric service are underground at the
time of installation. In areas where either telephone, cable, or electric utility facilities are above
ground at the time of installation, KMC may install its Fiber Optic Network above ground;
provided, that at such time as those facilities are required to be placed underground by the City
12
Ord. No. 06-1996
Exhibit "A"
or are placed underground, KMC shall likewise place its Fiber Optic Network underground
without additional cost to the City or to the Corporate Subscribers served within the City.
Where not otherwise required to be placed underground by this Agreement, KMC's Fiber Optic
Network shall be located underground at the request of the adjacent property owner, provided
that the excess cost over the aerial location shall be borne by the property owner making the
request. Any and all portions of the Fiber Optic Network, or appurtenances thereto, to be
constructed under any paved street or alley, or other Public Right-of-Way shall be accomplished
by the jacking of an underground pipe or conduit, and under no circumstances shall the Fiber
Optic Network be constructed under a paved street, alley or other public way by digging or
excavating from the surface of the paved street. All portions of the Fiber Optic Network, or
appurtenances thereto, passing under the street shall be installed in conduit.
(b) Prior to performing any underground construction, KMC shall use
its best efforts to locate, in advance, any water, sewage, gas, electric, cable, drainage, or other
utility lines, including compliance with Chapter 556, Florida Statutes, to the extent applicable.
Where any damages or alterations occur to said utility lines in the public right-of-way as a result
of construction, reconstruction, maintenance, or removal of the Fiber Optic Network by KMC,
its agents or independent contractors, the cost of such repairs including all services and materials
will be the responsibility of KMC.
13.6 Construction Notice. Except with regard to routine maintenance and
emergency circumstances, KMC shall give appropriate notice to the City and affected residents
within a reasonable period of time of proposed construction, reconstruction, excavation, laying
or stringing of the Fiber Optic Network under streets or on poles, but in no event shall such
notice be given less than five (5) business days before such commencement.
13.7 Interference with Persons, Public and Private Property, and Utilities.
KMC's Fiber Optic Network and all appurtenances shall be located, erected and maintained so
that such system shall:
(a) Not endanger or interfere with the health, safety or lives of persons;
(b) Not interfere with any improvements which the City,county or state
may deem proper to make;
(c) Not interfere with the free and proper use of public rights-of-way,
alleys, bridges, easements or other public property, except to the minimum extent possible
during actual construction or repair;
(d) Not interfere with the rights and reasonable convenience of private
property owners, except to the minimum extent possible during actual construction or repairs;
and
(e) Not obstruct, hinder or interfere with any gas, cable, electric,
13
Ord. No. 06-1996
Exhibit "A"
water, wastewater, reclaimed water, stormwater drainage, telephone, or other utility facilities
located within the City.
13.8 Restoration to Prior Condition. In case of any disturbance of pavement,
sidewalk, driveway or other surfacing, KMC shall, at its own cost and expense, and in a manner
approved by the City, replace and restore all paving, sidewalk, driveway, landscaping, or
surface of any street or alley disturbed, in as good a condition as before said work was
commenced and in a good workmanlike, timely manner in accordance with standards for such
work set by the City or the governmental entity having operational and maintenance
responsibility for the Public Right-of-Way. Unless otherwise approved by the City Manager,
such restoration shall be undertaken within no more than ten (10) business days after the damage
is incurred and shall be completed as soon as possible thereafter.
13.9 Private Property. KMC shall promptly repair or replace all private
property, both real and personal, damaged or destroyed as a result of the construction,
installation, operating or maintenance of the Fiber Optic Network at its sole cost and expense.
13.10 Progress Reports. For work involving Public Right-of-Way excavation
for other than in the event of an emergency, prior to commencing construction, KMC shall
provide the City with a schedule for completion of said work and keep the City informed of the
construction progress as reasonably necessary
13.11 Use of Existing Poles. KMC shall endeavor to enter into agreements for
the purposes of sharing poles with any person, firm, or corporation now or hereafter authorized
by license, franchise or otherwise to erect and maintain overhead or underground wires and
cables, it being the intent hereof that all above ground installations of the Fiber Optic Network,
or parts thereof, shall be accomplished on existing utility poles and easements where feasible,
and installed only parallel to existing facilities. Where new poles are deemed necessary for
installation of the Fiber Optic Network, prior City approval as to the location and type must be
received.
13.13 Due Care. KMC shall at all times exercise due care and shall install,
maintain and use commonly accepted methods and devices for preventing failures and accidents
which are likely to cause damage, injuries or nuisances to the public. The Fiber Optic Network
shall at all times be kept and maintained in a safe, suitable, substantial condition, and in good
order and repair.
13.14 Work Areas. KMC shall at all times maintain and protect all job sites
with suitable barricades, flags, lights, flares, or other devices that are required by the Manual
on Uniform Traffic Control Devices to protect all members of the public having occasion to use
the portion of the Rights-of-way and streets involved in the installation, maintenance, and
construction of the Fiber Optic Network.
14
Ord. No. 06-1996
Exhibit "A"
XIV. LOCAL GOVERNMENT CONNECTION TO NETWORK.
14.1 KMC shall connect the City to the Fiber Optic Network by providing, at its sole
cost and expense, T-1 connectivity to the City Hall of the City of Cape Canaveral. KMC agrees
that the City shall not incur any fees or costs whatsoever for use of the Fiber Optic Network.
In the event KMC completes a build-out of its Fiber Optic Network within the Franchise Area,
KMC agrees to provide the City with dark fiber connectivity to the Fiber Optic Network at no
cost and expense to the City.
XV. SERVICE STANDARDS.
15.1 Operation. KMC shall maintain and operate its Fiber Optic Network and render
efficient service in accordance with the rules and regulations as are, or may be, set forth by the
City Council of the City of Cape Canaveral as provided in this Franchise and by the Public
Service Commission.
15.2 Planned Downtime. KMC shall provide reasonable notice to all Corporate
Subscribers who will be affected by an interruption of service for the purpose of repairs to, and
installation of, the Fiber Optic Network. Any interruption of service shall be at such times that
will cause the least amount of inconvenience to Corporate Subscribers.
XVI. BOOKS AND RECORDS AVAILABLE TO CITY.
16.1 Records. With advance written request, the City shall have the right to
inspect at any time during normal business hours, all books, records, maps, revenue statements,
service complaint logs, performance test results and other like materials of KMC which relate
to the operation and enforcement of the Franchise within the City. Access to the aforementioned
records shall not be denied by KMC on the basis that said records contain "proprietary"
information, unless applicable law exempts said records.
16.2 Review. KMC shall permit, during KMC's normal business hours, any
duly authorized representative of the City to examine, at the City's discretion, any and all maps
and other records kept or maintained by KMC or under its control concerning the operations,
affairs, transactions or property of KMC relative to the Fiber Optic Network operations in the
City. The examination shall take place at KMC's place of business.
16.3 Reports to Be Filed. The following financial reports for the Franchise
area shall be submitted to the City:
(a) An annual report prepared by KMC or the parent company of
KMC shall be provided annually at the time said report is published.
(b) An annual financial report showing KMC's Gross Annual Revenues
and annual franchise fees collected in the Franchise Area.
15
Ord. No. 06-1996
Exhibit "A"
16.4 Other Records. The City may impose reasonable requests for additional
information, records and documents from time to time, and KMC shall produce said records
within ten (10) business days, so long as such request relates to the City's enforcement abilities
under this Agreement or the city's ordinances or resolutions.
XVII. PREFERENTIAL OR DISCRIMINATORY PRACTICES PROHIBITED.
All services, rates, charges rendered and all rules and regulations adopted by
KMC shall have general application to all persons and shall not subject any person to prejudice
or disadvantage on account of race, gender, religion, origin, or ethnicity. KMC shall not charge
customers different rates, or grant or make preferences, for access to, and use of, the Fiber
Optic Network for the same class or type of service.
XVIII. MISCELLANEOUS PROVISIONS.
18.1 No Joint Venture. Nothing herein shall be deemed to create a joint
venture or principal-agent relationship between the parties, and neither party is authorized to,
nor shall either party act toward third persons or the public in any manner which would indicate
any such relationship with the other.
18.2 Entire Agreement. This Agreement and all City Code provisions
regulating the distribution, transmission, or sale of fiber optic telecommunication service are
incorporated herein by reference, represent the entire understanding and agreement between the
parties hereto with respect to the subject matter hereof, and supersede all prior oral negotiations
between the parties. This Agreement may be amended, supplemented, modified, or changed
only by adoption of an Ordinance by the City and execution of an instrument agreeing to said
amendment, supplementation, modification, or change in the terms hereof by KMC.
18.3 Provisions Cumulative. The rights and remedies reserved to the City by
this Agreement are cumulative and shall be in addition to and not in derogation of any other
rights or remedies which the City may have with respect to the subject matter of this Agreement
subject to applicable law, and a waiver thereof at any time shall have no effect on the
enforcement of such rights or remedies at a future time.
18.4 Notices. All notices from KMC to the City pursuant to this Agreement
shall be sent to: City Manager, City of Cape Canaveral, Florida, 105 Polk Avenue, Cape
Canaveral, Florida 32920. All notices to KMC shall be sent to: Scott Brodey, Chief Operating
Officer, KMC TELECOM INC., 994 Explorer Boulevard, Huntsville, AL 35806. The names
and address in this section may be unilaterally amended by either party at anytime by giving
written notice to the other party.
18.5 Captions. Captions to sections through this Agreement are solely to
16
Ord. No. 06-1996
Exhibit "A"
facilitate the reading and reference to the sections and provisions of the Agreement. Such
captions shall not affect the meaning or interpretation of the Agreement.
18.6 Severability. If any section, subsection, sentence, clause, phrase, or
portion of this Agreement is, for any reason, held invalid or unconstitutional by any court of
competent jurisdiction, such portion shall be deemed a separate, distinct, and independent
provision. Such holding shall not affect the validity of the remaining portions of this
Agreement.
18.7 City's Rights of Intervention. KMC agrees not to oppose intervention
by the City if any suit or proceeding to which KMC is a party, concerning or involving KMC
and the City's rights under this Agreement.
18.8 Headings; Entire Agreement; Governing Law. The headings contained
in this Agreement are for reference purposes only and shall not affect in any way the meaning
and interpretation of this Agreement. This Agreement constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof. This Agreement shall be governed in all respects,
including validity, interpretation and effect, by the laws of the State of Florida.
18.9 Jurisdiction and Venue. The parties hereto agree that the state or federal
courts located in the State of Florida shall have the exclusive jurisdiction over the parties and
the subject matter of any litigation between the parties arising hereunder. For purpose of state
court action, venue shall lie within Brevard County, Florida, and for the purpose of federal court
action,venue shall lie within Orlando, Florida. THE COMPANY HEREBY WAIVES RIGHT
TO TRIAL BY JURY IN ANY ACTION BROUGHT ON THIS AGREEMENT OR ON
ANY MATTER ARISING IN CONNECTION WITH THIS AGREEMENT.
18.10 Attorney's Fees. In the event of any litigation or arbitration arising out
of this Agreement, the prevailing party shall be entitled to an award of its reasonable attorney's
fees and court costs incurred in such action.
18.11 Conflicts with State and Federal Regulations. In the event of any
conflict between the terms of this Franchise and rules and regulations of the Federal and Florida
Public Service Commissions now or hereafter in effect, the rules and regulations of such
commissions shall prevail; except where such rules and regulations provide standards less
stringent than provided herein or hereafter adopted, said standards shall continue in force and
effect where permitted by said commissions.
18.12 Franchise Costs. KMC agrees to pay the reasonable administrative and
legal costs incurred by the City in granting this Franchise, not to exceed two thousand five
hundred ($2,500). In the event this Franchise is renewed, transferred or assigned, KMC or its
successor in interest shall pay to the City the reasonable legal and administrative costs incurred
with said renewal or assignment, not to exceed two thousand five hundred ($2,500).
17
Ord. No. 06-1996
Exhibit "A"
18.13 Representations and Warranties of KMC. KMC hereby represents and
warrants to the City the following:
(a) KMC is duly registered and licensed to do business in the State of Florida and is in
good standing under the laws of Florida, and is duly qualified and authorized to carry on the
functions and operations set forth in this Agreement.
(b) The undersigned representative of KMC has the power, authority, and legal right to
execute and deliver this Agreement on behalf of KMC.
18.14 Renegotiation Clause. In the event of a material change in either federal
or state law or Public Service Commission Rules or in the event KMC enters into a Franchise
with Brevard County or any city within Brevard County which provides a Franchise Agreement
of more favorable terms than provided to our City under this Franchise, then the City and KMC
mutually agree to re-negotiate the terms of this Franchise affected by the change in said laws,
rules or Franchise Agreements. This Agreement shall remain in full force and effect until any
negotiated amendments have been duly approved by both the City and KMC.
Ili}' ,W4'f I SS WHEREOF, the parties hereto have caused this Agreement to be
`executed as of tlT iday and year first above written.
i c...,-
. �1.
CITY:
. CITY OF CAPE CANAVERAL,FLORIDA
4;4'ATTEST:. t /
'
1.
.rw i B • i �/
Sandrss
a. _...nen--.
Sims� City Clerk • .1 1 K. Porter, Mayor
COMPANY:
WITNESSES: KMC TELECOM INC.
By: _ A,,d,Zigi.-- - ---1
"cott Brodey, Chief Operat g Officer
18
Ord. No. 06-1996
Exhibit "A"
STATE OF FLORIDA
COUNTY OF BREVARD
The foregoing instrument was acknowledged before me this /4‘.6 day of
1 ,, , 1996, by JOHN K. PORTER, Mayor of the CITY OF CAPE CANAVERAL,
II A, a Florida Municipal Corporation, on behalf of the aforesaid municipal corporation,
is not personally known to me, or has produced as identification.
NOTAR PUBLIC
ftiaY,,,, , SANDRA H.SIMS
MY COMMISSION#CC 483561
U' : EXPIRES:July 24,1999
STATE OF FLORIDA '1.'�'P'. �; BOf rn"NAY Public unaefwo+m1=
COUNTY OF
The foregoing instrument was acknowledged before me thisL day of
1996, by SCOTT BRODEY, Chief Operating Officer of KMC TELECOM
INC.( �,beh of said corporation, who is/is not personally known to me, or has produced
• as identification.
• _.CIS{
N e TARY P :LW( ';; r, _
n:\cape.can\agnxmen\Ix
m .001 -E', (' °a''.
ARLENE SAPPERSTErW
NOTARY PUBLIC OF NEW JER EV` •`
MY COMMISSION EXPIRES SEPT 249 " ,-
19