HomeMy WebLinkAbout95-74 - ADMIN Resolution - City Council - 1995/06/05r
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RESOLUTION NO. 95-74
RESOLUTION RECOMMENDING APPROVAL OF THE
TRANSFER OF CONTROL OF KBLCOM INC. FROM HOUSTON
INDUSTRIES INC. TO TIME WARNER INC.
WHEREAS, on or about February 7, 1989, the City of St. Louis Park, Minnesota ("City")
granted a Cable Communication Franchise to Nortel Cable Associates, L.P., a Delaware limited
partnership ("Nortel") by adoption of Ordinance No. 1774-89 as amended (the "St. Louis Park
Franchise"); and
WHEREAS, on February 13, 1989 Nortel accepted the St. Louis Park Franchise; and
WHEREAS, Nortel, doing business as "Paragon Cable," is the current and lawful Grantee of the
St. Louis Park Franchise; and
WHEREAS, Countryside Investments, Inc., a Delaware corporation ("Countryside") and Nortel
Cable Corporation, a Minnesota corporation ("NCC") own 17.1% and 89.9% limited partnership
interests respectively in Nortel; and
WHEREAS, and Countryside and NCC are each wholly owned by KBLCOM, Inc., a Delaware
corporation ("KBLCOM"); and
WHEREAS, KBLCOM is wholly owned by Houston Industries Inc., a Texas corporation ("HI");
and
WHEREAS, on January 26, 1995 HI entered into an Agreement and Plan of Merger with Time
Warner, Inc. ("Time Warner"), KBLCOM and TW KBLCOM Acquisition Corp ; and
WHEREAS, pursuant to the Agreement and Plan of Merger HI will transfer control of KBLCOM
to Time Warner; and
WHEREAS, in compliance with the terms of the Agreement and Plan of Merger, the name of
Nortel shall remain unchanged; and
WHEREAS, under the St. Louis Park Franchise and Minnesota Statutes Section 238 083, the
transfer of control of KBLCOM from HI to Time Warner constitutes a transfer by means of a
fundamental corporate change with respect to KBLCOM and Nortel; and
WHEREAS, under the St. Louis Park Franchise and Minnesota Statutes Section 238.083 any
such transfer requires the approval of the City; and
WHEREAS, the City, with the assistance of Moss & Barnett, a Professional Association, has
reviewed the proposed transfer of control of KBLCOM and the legal, technical and financial
qualifications of Time Warner; and
WHEREAS, based on information obtained at a public hearing conducted by the City on April 17,
May 15 and June 5, 1995 and on the reports and information received by the City, the City has
found no reason to disapprove of the transfer of control of KBLCOM from HI to Time Warner
NOW, THEREFORE, the City Council for the City of St Louis Park, Minnesota resolves as
follows:
1. The St Louis Park Franchise is in full force and effect and Nortel is the lawful holder of the St.
Louis Park Franchise.
2. The City hereby consents and approves of the transfer of control of KBLCOM from HI to
Time Warner subject to
a Closing of the transaction contemplated within the Agreement and Plan of Merger
pursuant to the terms and conditions described in information provided by Nortel,
KBLCOM, HI and Time Warner to the City including the Agreement and Plan of
Merger.
b. Time Warner promptly notifying the City in writing of the completion of the
transfer of control of KBLCOM
c. KBLCOM, within thirty (30) days of the closing of the transaction contemplated
within the Agreement and Plan of Merger, abiding by the requirements as listed
below:
i. Time Warner providing the City with an opinion of legal counsel
substantially in the form of Exhibit D to the Agreement and Plan of
Merger to the effect that the merger will constitute a "reorganization"
for Federal Income Tax purposed.
ii Time Warner providing the City with an opinion of legal counsel in a
form and substance acceptable to the City to the effect that the transfer
of control of KBLCOM from HI to Time Warner does not violate
47 U.S.C. #533.
3. The City hereby waives any right of first refusal which the City may have pursuant to
Section 9-725 or the St. Louis Park Franchise, as amended, or, otherwise, to purchase the St
Louis Park Franchise or the cable television system serving the City, but only as such right of first
refusal applies to the request for approval of the transfer of control of KBLCOM now before the
City.
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4. In the event the transfer of control of KBLCOM contemplated by the foregoing resolution is
not completed, for any reasons, the City's consent to the transfer of control shall not be effective
5. This resolution shall take effect and continue and remain in effect from and after the date of its
passage, approval and adoption.
A motion to approve the foregoing Resolution No. 95-74 was made by Councilmember Jacobs,
seconded by Councilmember Dorfman. The following Councilmembers voted in the affirmative:
Jacobs, Haun, Friedman, Latz, Young, Dorfman, Hanks
The following Councilmembers voted in the negative. None
Adopted by the City Council June 5, 1995•
Reviewed for Administration:
.4A le
City Manager
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W. Hanks, Mayor
Approved as to form and execution:
City Attorney