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HomeMy WebLinkAboutResolution 98-47RESOLUTION 9~47 RESOLUTION CONSENTING TO THE SEPARATION OF US WEST COMMUNICATIONS AND US WEST MEDIA GROUP WHEREAS, the cable television franchise (the '~ranchise") of the City of Columbia Heights C'City') is currently owned and operated by Group W Cable of Columbia Heights, Inc. ("Grantee") which is indirectly but wholly-owned by US WEST, Inc. C'USW"); and WHEREAS, USW's Board of Directors has voted to recommend restructuring USW into two completely separate, unafrdiated companies and USW's shareholders are expected to vote on such restructuring at the next annual meeting of shareholders; and WHEREAS, the restructuring, as more fully described in the SEC Form S-4 Registration Statement filed-by USW-C, Inc. on behalf ofUSW C'SEC Form S-4"), which is incorporated herein by reference, will result in the formation of New US WEST, Inc. (to be renamed US WEST, Inc. and referred to herein as "New US WEST") and MediaOne Group, Inc. ("MediaOne Group"); and WHEREAS, subsequent to restructuring, Media One Group will own and operate substantially all of the cable systems currently owned and operated by USW, along with certain other businesses, and New US WEST will own and operate the fourteen (14) state regional bell operating company telephone business currently owned and operated by USW, along with certain other businesses~ and WHEREAS, subsequent to restructurin8, MediaOne Group will wholly own the Grantee and New US WEST will have no interest in the Grantee; and WHEREAS, this restructuring will impact the technical, legal, and financial qualifications of USW, and is subject to review and approval by the City pursuant to federal, state, and local law, and the Franchise; and WHEREAS, USW has requested the City' s consent and approval for this restructufing and has filed documentation related thereto C'Request'); and WHEREAS, the City has previously consented to ownership by USW upon certain conditions, including the provision of a Corporate Guaranty; and WHEREAS, the City has reviewed the Request including the SEC Form S4, has solicited, received and reviewed certain other information and responses from USW including certain IRS rulings, a draft Separation Agreement and FCC Orders, and has procured, received, and reviewed an analysis of the financial impact of the restructuring; and WHEREAS, Media One Group will guarantee all Franchise obligations pursuant to a reaffirmation of the Corporate Guaranty currently provided by USW; and WHEREAS, no notice orbreach or default under the Franchise has been issued by City or any of its Member Municipalities within the past 12 months and none is outstanding; and WHEREAS, the City has determined that subject to certain conditions which must be met, MediaOne Group possesses the requisite minimum 'legal, technical, and financial qualifications; NOW, THEREFORE, BE IT RESOLVED, that the restructuring of USW into two separate companies-MediaOne Group, Inc. and New US WEST, Inc. is hereby approved and consented to by the City and permitted conditioned upon: Execution and delivery of a letter reaffirming the Corporate Guaranty from MediaOne Group in a form and substance acceptable to City; and Execution and delivery of a copy of the Separation Agreement det~_iling the understandings and agreements between MediaOne Group and New US WEST subsequent to separation, the inclusion therein of non-competitive agreements shall void this approval and consent as of the date hereof; and , Compliance with all federal, state, and local government orders, decisions, authorizations, or approvals relating to MediaOne Group's ownership and operation of the system; and Successful consummation of the transaction as described in the SEC Form S-4, including receipt of all required regulatory and shareholder approvals, on or before July 31, 1998, with written certification that the transaction was consummated in materially the same manner as indicated in the SEC Form S-4. In the event closing does not occur prior to this date, the City's consent to transfer shall be deemed to be withheld. Reimbursement of all reasonable fees incurred in the City' s review of the proposed transactions; and BE IT FURTHER RESOLVED, that MediaOne Group may, at any time and from time to time, assign or grant or otherwise convey one or more liens or security interests in its assets, including the Franchise to any lender providing financing to Media One Group, from time to time. Passed this 26 day of ~tay ,1998. Offered by: Ruett iraann Seconded by: Jol 1y Roll Call: A11 ayes /Grad Studl/~'4h~'ent, Council Sec'~a'~'~reretary ~or:ep~turdevant, ~layor '