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HomeMy WebLinkAbout06740 ORD - 12/28/1962IMS:JXH:12 -28 -62 . 1 , AN ORDINANCE AUTHORIZING AND DIRECTING THE CITY MANAGER, FOR AND ON BEHALF OF THE CITY OF CORPUS CHRISTI;, TO EXECUTE AN OPERATING AGREEMENT BETWEEN CORPUS CHRISTI MUNICIPAL GAS CORPORATION AND THE CITY OF CORPUS CHRISTI, A COPY OF WHICH IS ATTACHED HERETO AND MADE A PART HEREOF, SETTING FORTH THE TERMS OF OPERATION BY THE CITY OF A GAS DISTRIBU- TION SYSTEM IN CERTAIN AREAS OF THE CITY OF CORPUS CHRISTI; AND DECLARING AN EMERGENCY. WHEREAS, CONTRACT OF PURCHASE HAS BEEN ENTERED INTO BETWEEN THE CITY OF CORPUS CHRISTI CORPUS CHRISTI MUNICIPAL GAS CORPORATION AND HOUSTON NATURAL GAS CORPORATION FOR THE ACQUISITION BY THE CORPUS CHRISTI MUNICIPAL GAS CORPORATION FOR THE CITY OF A GAS DISTRIBUTION SYSTEM IN CERTAIN AREAS OF THE CITY OF CORPUS CHRISTI AND WHEREAS, THE COMPANY WILL PURCHASE THE SYSTEM AND SELL ITS BONDS FOR THE PURPOSE OF PURCHASING THE SYSTEM FOR THE BENEFIT OF THE CITY AND IT IS DESIRABLE THAT UPON THE ACQUISITION OF SUCH SYSTEM THAT THE SAME BE OPERATED BY THE CITY AT THE EXPENSE OF THE COMPANY AND THE TERMS OF SUCH OPERATION AGREEMENT HAVE BEEN SET FORTH IN WRITING, DESIGNATED AS "OPERATING AGREEMENT" HEREINAFTER REFERRED TO: NOWT THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. THAT THE CITY MANAGER BE, AND HE IS HEREBY AUTHORIZED AND DIRECTED, FOR AND ON BEHALF OF THE CITY OF CORPUS CHRISTI, TO EXECUTE AN OPERATING AGREEMENT BETWEEN CORPUS CHRISTI MUNICIPAL GAS CORPORATION AND THE CITY OF CORPUS CHRISTI, A COPY OF WHICH IS ATTACHED HERETO AND MADE A PART HEREOF, SETTING FORTH THE TERMS OF OPERATION BY THE CITY OF A GAS DISTRIBUTION SYSTEM IN CERTAIN AREAS OF THE CITY OF CORPUS CHRISTI. SECTION 2. THE NECESSITY FOR CONTINUATION OF THE OPERATION OF THE SYSTEM THIS DAY BEING ACQUIRED BY CORPUS CHRISTI MUNICIPAL GAS CORPORATION FOR THE BENEFIT OF THE CITY FROM HOUSTON NATURAL GAS CORPORATION SO THERE BE NO INTERRUPTION OF GAS SERVICE TO THE CITY 6710 u 1+ GAS SYSTEM REQUIRES THE IMMEDIATE AUTHORIZATION OF EXECUTION OF THE OPERATING AGREEMENT HEREINABOVE REFERRED TO, AND SUCH NECESSITY FOR IMMEDIATE EXECUTION THEREOF CREATES A PUBLIC EMERGENCY AND AN IMPERATIVE PUBLIC NECESSITY REQUIRING THE SUSPENSION OF THE CHARTER RULE THAT NO ORDINANCE OR RESOLUTION SHALL BE PASSED FINALLY ON THE DATE OF ITS INTRODUCTION AND THAT SUCH ORDINANCE OR RESOLUTION SHALL BE READ AT THREE SEVERAL MEETINGS OF THE CITY COUNCIL, AND THE MAYOR HAVING DECLARED SUCH EMERGENCY AND NECESSITY TO EXIST, HAVING RE- QUESTED THE SUSPENSION OF SAID CHARTER RULE AND THAT THIS ORDINANCE BE PASSED FINALLY ON THE DATE OF ITS INTRODUCTION AND THAT THIS ORDINANCE TAKE EFFECT AND BE IN FULL FORCE AND EFFECT FROM AND AFTER ITS, :PASSAGE, IT IS ACCORDINGLY SO ORDAINED THIS 28TH DAY OF DECEMBER, 1962. MAYOR THE CITY OF CORPUS CHRISTI, gm ATT CI SECRETARY/ APPROVED AS TO LEGAL FORM THIS THE 28TH DAY OF DECEMBp,.1962: CITY ATTORNEY THE STATE CF TEXAS OPERATING AGREEMENT COUM OF IMCES THIS AGREEMENT (hereinafter called the "Agreement ") made and entered into as of the 15th day of December, 1962, by and between Corpus Christi Municipal Gas Corporation (hereinafter called "Company"), a corporation organized and existing under the laws of the State of Texas, and the City of Corpus Christi, Texas, a municipal corporation in Nueces County, Texas, acting under the laws of the State of Texas, (hereinafter called the "City "): W I T N E S S E T H: WHEREAS, the City owns and operates a gas distribution system; and Houston Natural Gas Corporation, a Texas corporation, in addition to other properties, also owns and operates a gas transmission and distribution system within the corporate limits of the City and in certain areas near such City; and WHEREAS, the City leas caused the Company to be organized for the purpose of acquiring for and on behalf of the City, certain gas transmission and distribution properties of Houston Natural Gas Corpora- tion, and the City and the Company have entered into a contract with said Houston Natural Gas Corporation, dated November 28, 1962, to purchase such properties, (hereinafter called the "System "); and WHEREAS, the Company will purchase the System and will issue and sell its bonds (together with any additional bonds to be issued by Company, or refunding bonds issued in lieu of such bonds, all hereinafter called the "Bonds "), for the purpose of purchasing the System; and WHEREAS, the Bonds will be secured by an Indenture of Mortgage and Deed of Trust (herein called the "Indenture ") which shall control the operation of the System of Company and the handling of the funds of Company; and WHEREAS, City has agreed to operate the System at the expense of Company; 0 NOW, T=MORE, in consideration of the mutual covenants and agreements herein contained and subject to the terms and conditions and stipulations herein it is agreed as follows, to -wit; 1. SYSTEM. That Company shall purchase at its expense the System, and in order to provide the funds for the purchase of the System, the Company will sell its First Mortgage Bonds; and the City will operate the System. 2. SPECIAL CORDIT.IONS. That the parties hereto will abide by the following special conditions, to -wit; (a) That Company shall proceed promptly with the purchase of the System. (b) That the obligation on the part of the Company to purchase the System shall be conditioned upon the sale of its Bonds in an amount sufficient to assure purchase of the System. (c) That City shall operate and maintain the System in an efficient and economical manner and will pay all "Operating Expenses" (as defined in the Indenture) incurred in connection therewith from a fund to be provided by Company. City agrees to bill all customers of Company and collect and deposit the receipts from customers in a special fund to be provided by Company. City will comply with the terms of the Indenture in operating and maintaining the System and in administering the funds of Company. (d) That the Company shall fix and the City will permit the Company to fix rates and charges for gas and services to be supplied by the System that are identical to the rates and charges maintained by the City for such services. The City will fix rates and charges to be charged its customers for gas services as will permit the City to pay the operating expenses of its systems, the interest on and principal of all bonds now or thereafter issued by the City that are payable from the revenues of such systems, and which with respect to the System will permit the Company to pay the operating expenses, the principal of and interest on the Bonds,and make all other payments required by the Indenture. may. (e) That Co y will provide at the expense of the Company the personnel and equipment necessary to perform the engineering services required by the Indenture to be performed by the "Operating Engineer" and the "Consulting Engineers." (f) That each party hereto shall save and hold the other party harmless from all claims, demands and causes of action due to occurrences that take place on their respective gas distribution systems. This covenant is not made for the benefit of any third party, ro (g) That City has concurrently herewith granted to Company its consent to the use of the present and future streets, alleys, highways and public grounds within the corporate limits of City, for the purpose of maintaining and operating the System and any extensions thereof or improvements thereto. a. FORCE MAJEURE. That in case by reason of "Force Majeure" either party hereto shall be rendered unable wholly or in part to carry out its obligations under this agreement, then if such party shall give notice and full particulars of such "Force Majeure" in writing to the other party within a reasonable time after occurrence of the event or cause relied on, the obligation of the party giving such notice, so far as it is affected by such "Force Majeure", shall be suspended during the continuance of the inability then claimed, but for no longer period, and any such party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term "Force Majeure" as employed herein, shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of public enemy, orders of any kind of the Government of the United States or the State of Texas or any civil or military authority, insur- rections, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipe lines or canals, partial or entire failure of gas supply, and inability on part of Company or City to deliver or receive gas hereunder on account of any other causes not reasonably within the control of the party claiming such inability. It is understood and agreed that the settlement of strikes and lockouts aball be entirely within the discretion of the party having the difficulty, and that the above requirement that any Force Majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes and lockouts by acceding to the demands of the opposing party or parties when such settlement is unfavorable to it in the judgment of the party having the difficulty. 4. INSURANCE. That the Indenture will contain appropriate provisions requiring Company to carry insurance on its insurable properties for purposes and in amounts which would ordinarily be carried by a privately owned utility company under contract to perform services similar to those undertaken by Company in this Contract. Such provisions will be so designed as to afford protection not only for the holders of the Bonds but to ensure and facilitate, to the extent feasible and practicable, the restoration of damaged or destroyed properties and to minimize the inter- ruption of service to customers of the Company. r- TERM OF CONTRACT. That this Contract shall continue in force and effect until such time as all of the Bonds issued pursuant to the Indenture or as subsequently refunded or refinanced are paid in full, and the City receives title to the System. 6• CONVEYANCE TO CITY. (a) That simultaneously with delivery to the Trustee of the Indenture the Company will execute and deliver to the Trustee a deed and other conveyances conveying all right, title and interest in and to the System to the City subject only to the lien of the Indenture and agreements adopted supplemental thereto, which said deed and conveyances are to be delivered by the Trustee to the City upon the payment of the indebtedness incurred in accordance with the terms of the Deed of Trust and any renewals or extensions thereof. (b) At such time as such deed is delivered to the City, the Company will cause to be delivered to the City, all other assets of the Company, regardless of the nature thereof, including, but not limited to, all cash held by or for the credit of the Company. • 7. MODIFICATION. That this Contract may be changed or modified only with the consent of Company and the governing body of City. Such modification may be requested by either party in which event a joint meeting of representatives of the parties shall be held not less than ninety days after the giving of such notice, at which joint meeting the requested changes or modifications shall be considered and discussed. No such change or modification may be made which will affect adversely any provision of the Indenture or the resolution or resolutions authorizing any of the Bonds. S. REGULATORY BODIES. That this Agreement shall be subject to all valid rules, regulations and laws applicable hereto and heretofore passed or promulgated by the United States of America, the State of Texas or any governmental body or agency having lawful jurisdiction or any authorized representative or agency of any of them. V. NOTICES. That the notices or communications provided for herein shall be in writing and shall be either delivered to City or Company, or if mailed, shall be sent by registered mail, postage prepaid, addressed to City at Corpus Christi, Texas, or until otherwise specified by the Company in writing, to Company at Corpus Christi, Texas. IN WITNESS WEMCF, the parties hereto have caused this Contract to be executed in several counterparts by their duly authorized officers and their corporate seals affixed thereto, each of said counter- parts shall constitute an original, all as of the day and year first above written. ATTEST: Secretary (SEAL) CORPUS CHRISTI MUNICIPAL GAS CORPORATION BY CITY OF CORPUS CHRISTI, TEXAS BY ATTEST: CITY R4AMZR DIRECTOR OF FINANCE City Secretary APPROVED AS TO LEGAL FORM THIS THE (SEAL) DAY OF DECEMBER, 1962: CITY ATTORNRY • THE STATE OF TEXAS COUNTY OF NUECES BEFORE ME, the undersigned Notary Public in and for Nueces County, Texas, on this day personally appeared and , ]mown to me to be the person whose names are subscribed to the foregoing instrument and known to me to be, respectively, the President and Secretary of the Corpus Christi Municipal Gas Corporation, and each acknowledged to me that he executed said instrument for the purposes and considerations therein expressed and in the capacity therein stated and as the act and deed of Corpus Christi Municipal Gas Corporation. GIVEN UNDER 14Y HAND AND SEAL OF OFFICE this the day of , 1962. Notary Public, Nueces County, Texas (SEAL) THE STATE OF TEXAS COUNTY OF NUECES BEFORE ME, the undersigned Notary Public in and for Nueces County, Texas, on this day personally appeared and , each known to me to be the persons whose name is subscribed to the foregoing instrument and each acknowledged to me that he had executed the same for the purposes and considerations therein expressed and in the capacity therein stated as the act and deed of the City of Corpus Christi, Taxes. EXECUTED UNDER MY HAND and seal of office this the day of , 1962. Notary Public, Nueces County, Texas. (SEAL) CORPUS CHRISTI TEXAS ,�"yy O` d DAY OF , 19_C .Z TO THE MEMBERS OF THE CITY COUNCIL CORPUS CHRISTI, TEXAS FOR THE REASONS SET FORTH IN THE EMERGENCY CLAUSE OF THE FORE- GOING ORDINANCE, A PUBLIC EMERGENCY AND IMPERATIVE NECESSITY EXIST FOR THE SUSPENSION OF THE CHARTER RULE OR REQUIREMENT THAT NO ORDINANCE OR RESOLUTION SHALL BE PASSED FINALLY ON THE DATE IT IS INTRODUCED, AND THAT SUCH ORDINANCE OR RESOLUTION SHALL BE READ AT THREE MEETINGS OF THE CITY COUNCIL; IS THEREFORE, HEREBY REQUEST THAT YOU SUSPEND SAID CHARTER RULE OR REQUIREMENT AND PASS THIS ORDINANCE FINALLY ON THE DATE IT IS INTRODUCED, OR AT THE PRESENT MEETING OF THE CITY COUNCIL, RESPECTFULLY, RMF THE CHARTER RULE WAS SUSPENDED BY THE FOLLOWING VOTE: BEN F. McDONALO Tom R. SWRNTNER l DRo JAMES Le BARNARD JOSE R. DELEON M. Pe MALDONADO We J. ROBERTS JAMES H. YOUNG THE ABOVE ORDINANCE WAS PASSED BY THE FOLLOWIN VOTE= BEN Fe MCDONALD TOM R. SWANTNER x DR. JAMES L. BARNARD-' JOSE R. DELEON / M. Pe MA LDONADO We J. ROBERTS J JAMES He YOUNG /