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ORD INANCE N O. 1711
BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF
FAIRHOPE, ALABAMA, AS FOLLOWS :
SECTION 1. The City of Fairho pe , Alabama, having received an application
from Coca-Cola Bottling Company U nited for a franchise agreement to operate
B ev era ge Ve ndin g M achines at the following location described : in location s
specified in Bid N o. 006-21 , B eve ra ge Ve nding and Concess ion s 2021 , and it
is to be in the best interest of the public and the City of Fairhope, Alabama, to
grant a franchise to Coca-Col a Bottlin g Company United under the terms and
condi tions of the franchise agreement attached hereto as "Exhibit A " including
the fees th at sha ll be paid to the City with respect to same.
SECTION 2. Pursuant to the autho rity granted by Section 11-40-1 and 11-43-62
of the Code of Alabama of 1975 , the Mayor of the City of Fairhope, Alab ama, is
hereby di r ected to execute said franchise agreement in the name of the City of
Fairhope, A labama.
SECTIO 3. The sections , paragraphs , sentences, clauses and phrases of this
ordinance are severab le, and if any phrase , clau se, sentence, p aragraph or section
of this ordinance shall be dec lare d unconstitutional by a court of competent
jurisdiction, then such ru ling sha ll not affect any other paragraphs and sections ,
since the same would have been enacted by the municipality council without the
incorporation of any such unconstitutional phrase , clause , sentence , paragraph or
section.
SECTION 4. This ordinance shall take effect immediately u pon its due adoption
and publication as required by law.
ADOP TED THIS 14TH D AY O F JUNE , 2 021
ATTEST:
~~ City C erk
FRANCHISE AGREEMENT
This Agreement is made and entered into by and between the City of Fairhope , Alabama
1· _ ,/ -<:wi-/r,. / , LLG
("City") a municipal corporation and '-OC.C{-Col'<. &All,,,,() wwp,oy 1111,t&("Grantee "),
RECITALS
proprietor with a principal place of business at
-----------------11--Fairhope, AL 36532 . Grantee is engaged in the
Grantee is a sole
business of
proposes to
_.,_.......,.,.._,..:..:......:"""""';,,..,,<--_....,....__. .......... -'--'-''¥--------~to the public . Grantee
at the
Sc\<.kt uk ca~ /,ocA::bl00"> . Gra ity grant to Grantee a
franchise to install, maintain and operate this business on public property at the
°t)'c..el ,i Qcm '1rn~'""'b Loc.CA.i)m, . .S
In consideration of the mutual covenants, promises and conditions set forth herein
the parties agree as follows :
SECTION 1
Section 1.1 DEFINITIONS
Unless otherwise specially provided, or unless clearly required by the context , the
words and phrases defined in this section shall have the following meanings when used
in this Ordinance and Franchise Agreement:
( 1) MAYOR: Shall mean the Mayor of the City of Fairhope
(2) COUNCIL: Shall mean the City Council of Fairhope, the governing body of City of
Fairhope , Alabama.
(3) CITY: Shall mean City of Fairhope , Alabama, which is governed by the Fairhope
City Council.
(4) FRANCHISE: Shall mean the franchise granted under the provisions of the Ala.
Code §11-40-1 , et seq ., which authorizes municipalities to contract and to be contracted
with . A "franchise " as used in this agreement is a special privilege not belonging to the
citizens by common right but conferred by a municipality upon an ind ivid ual or
corporation.
U-"' \r.._\ I lJ-v
(5) GRANTEE: Shall mean lou...-Col.,_ i!cl~CJ1""1W''t IArv+J-to whom a franchise
has been granted by the 1ty or anyone who succeeds
Coc:..c..__ -u., \l>.. ~1 ~ Lo"'"°"'':l I.Ml :W ~ ~-\-..,,__\ 1 LL. c... , in accordance with the provisions of
the franchise.
(6) GROSS REVENUES : Shall mean all revenues received by the Grantee from or in
connection with the operation of the franchise to provide services in the City of Fairhope
pursuant to this franchise agreement.
(7) PERSON: Shall mean an individual, partnership , association , joint stock
company , trust , corporation , or governmental entity .
(8) SERVICE AREA: Shall mean the ~eogra hical area within City of Fairhope and
specifically defined as follows: · (}..,, ~~<--l,o _c.,cdi tn-\.S
Section 1.2 REQUIREMENTS FOR FRANCHISE
(a) No person shall engage in the construction , operation, or maintenance of a
private business on public property in the City unless such person or the person for whom
such action is being taken shall hold a valid franchise granted by the City .
(b) Any franchise granted by the City pursuant to these rules and regulations
shall not be deemed to be an exclusive right of permission. The City expressly reserves
the right to grant similar nonexclusive franchises to other persons.
(c) In the event the City enters into a franchise, permit , license , authorization ,
or other agreement of any kind with any other person or entity other than the Grantee to
enter into the City 's Public Rights-of-way or public property for the purpose of operating a
private business on public property in any part of the City , the material provisions thereof
shall be reasonab ly comparable to those contained herein , in order that one operator not
be granted an unfair competitive advantage over another, and to provide all parties equal
protection under the law .
(d) No franchise shall be granted by the City in the Central Business District
located in downtown Fairhope.
( e) No franchise shall be granted by the City to any food vendor who does not
show proof of ServSafe certification.
(f) No franchise shall be granted by the City to any vendor requiring a running
water supply for personal sanitary purposes and/or for cleaning equipment used in the
preparation of his/her product unless water supply is provided and metered by the City .
(g) Food franchises shall meet all Alabama Health Department regulations
and show proof thereof.
(h) No franchise shall be granted by the City to any vendor who has electrical
requirements without securing metered power from the City or, if applicable, having a
generator to supply the power required; generator shall meet City of Fairhope noise
ordinances .
Section 1.3 TERM OF FRANCHISE, RENEWAL
(a) The duration of this franchise agreement granted pursuant to this
Ordinance shall be for one year and shall be renewed automatically each year for three
years unless notice of termination is given in writing to the other party at least 60 days
prior to the expiration of the then current term . This Agreement shall commence 10 days
after approved by the City Council.
Section 1.4 ENFORCEMENT OF FRANCHISE
(a ) A Grantee shall not be excused from complying with any of the terms or
conditions of the franchise by any failure of the City upon any one or more occasions to
insist upon or to seek compliance with any such terms or conditions .
(b) Whenever the City shall set forth any time for any action to be performed
by or on behalf of Grantee , said time shall be deemed of the essence and any failure of
Grantee to perform with in the time allotted shall be sufficient grounds for the City to
revoke the franchise .
(c) A Grantee agrees by filing an application for a franchise that they w ill no t
assert, at any time, in any claim or proceeding that any condition or term of the franchise
is unreasonable , arbitrary or void or that the City had no power or authority to make such
term or conditions, but shall be required to accept the validity of the terms and conditions
of the franchise in their entirety.
Section 1.5 CONFLICT WITH LAWS
(a) Whenever any law of the State of Alabama or of the United States , or of
any agency of either, shall be in direct conflict with and supersede any provision of these
rules and regulations , then for so long as such state or federal law or regulation shall be
in force and effect, any affected provisions of this franchise granted hereunder shall be
suspended and be of no force and effect and the Grantee shall not be required to comply
with such provision; however, the validity of the remaining portions or provisions shall not
be affected thereby . In the event this franchise imposes burdens d ifferent than those
imposed by any other law , but within the power of the City to impose said burdens , the
more restrictive provision shall apply.
(b) If any section , sentence , clause or phrase of these rules and regulat ions or
of any franchise granted hereunder is held unconstitutional or otherwise invalid , such
infirmity shall not affect the validity of the remaining portion of these rules and regulations
or a of any franchise granted hereunder.
SECTION 2
Section 2.1 PROCEDURE FOR GRANTING FRANCHISE
(a) Any person desiring a franchise shall apply to the City for such a grant.
The application for a franchise shall be in writing, in the form approved by and
containing such info rmation as required by the City and must be accompanied by a
nonrefundable application fee of $150.00 by cashier's check, certified check or
money order payable to City of Fairhope. This is a separate fee from the Franchise fee .
(b) Upon receipt of said franchise application , the City shall provide notice of said
application and conduct a public hearing to determine if t he grant of the franchise would
be in the best interest of the citizens of City of Fairhope .
(c) The appl ication shall contain a statement under oath that the applican t will comply
with all legal, financial and technical provisions of these rules and regulations and any
other mun icipal , state or federal regulatory agencies .
(d} The application shall define the proposed service area of t he applicant with
specific t ime standards for the establishment of service to suit the service area .
SECTION 3
Section 3.1 CONSTRUCTION AND INSTALLATION
(a ) After receipt of an initial franchise , a Grantee shall proceed with due
diligence to install and begin operation of the franchise.
F ilure on the part of the Grantee to commence and diligently pursue
\ or failure to commence operation after 90 days
from e commenc ment of th is agreement shall be grounds for termination of the
franchise . The City may extend the time for the commencement and complet ion of £,ux.r~✓ tJt,,V\!tvL:t; for additional periods in the event the Grantee , acting in good
faith , experiences lays by reasons of circumstances beyond her control.
(d ) T he \J..uvL~ lY\o.Lh 1'V)t5 shall be constructed and operated in
accordance with all adopted ity , state and national construction and e lectrical codes.
Section 3.2 CONDITIONS FOR USE OF PUBLIC PROPERTY
(a) Grantee shall not install or begin operation of the franchise business until
the installation has been approved by the Mayor or his designee .
Section 3.3 OPERATION AND MAINTENANCE
(a ) The Grantee shall install and mainta in ~Dfo&.>,,,,a,J~U:""'o..=~~e .... ~ ..... lJ ..... en ..... , .... L"""'f\-'-"L\._-b-/"'-----
in a prudent and reasonable manner. (j
(b ) Failures or malfunctions of the b u--o.. shall be
corrected by the Grantee promptly after notice of such fa re or ma lfun n except or
unless s uch failure or malfunction shall have been caused by storm , fi re , lightening ,
explosion , civil unrest or ot her similar catastrophe .
(c) The City shall, if it deems it necessary, have the right and privilege to
inspect the installation, operation and maintenance of the _."""'""u~....,,,..,.--"'-'~L..LLJ~~-
by the Grantee in order to satisfy itself as to the proper performance this
franchise agreement.
SECTION 4
Section 4.1 FRANCHISE FEE
(a) There shall be a franchise fee of twenty (20) percent of Gross Revenues ;
and the fee for the business license which is an annual license issued by the municipality
for the privilege of doing any kind of business, trade, profession or other activity in the
municipality , by whatever name called.
(b) Grantee shall pay quarterly to the City during the life of the franchise a
sum equal to twenty (20) percent of its gross revenues . Grantee shall file with the City on
such form as prescribed by the City within sixty (60) days after the end of each quarterly
a report, under oath at the risk of perjury, of the gross revenues for the preceding
quarterly period, and shall , at the same time, pay to the City a sum equal to twenty (20)
percent of the gross revenues for the said quarterly period .
Exception #13
Item X, Exhibit B Franchise Agreement , Section 4.2 Indemnifications
United takes exception and proposes the following changes for consistency with the RFP's previous
indemnification and insurance sections as redlined below:
a. Grantee shall at his/her sole cost and expense fully indemnify, defend and save harmless the City,
its officers, boards, and employees against any and all claims, demands, suits, actions, liability and
judgments for damage arising out of the negligence or willful misconduct of the Grantee in the construction ,
operation and maintenance of the beverage vending franchise , and against all liabilities for damages by
reason of, or arising ou t of, any failure by Grantee to safely operate and maintain the beverage vending
franchise , including reasonable attorney's fees , arising out of the exercise or enjoyment of this franchise ,
irrespective of the amount of comprehensive liability policy required hereunder. This indemnity shall not
apply to damages occasioned solely and exclusively by acts of the City, its agents or employees.
fh} Within thirty (30) days after the granting of the franchise and at all times during the term of the
franchise , Grantee shall obtain, pay all premiums for, and file with the City a Certificate of Insurance for such
insurance coverage as set forth in Item VII (INSURANCE) of the Bid 006 -21 .
(c) All of the foregoing insurance certificates shall be in form satisfa ctory to the City and shall be issued
and maintained by companies authorized to do business in the State of Alabama and acceptable to the City
and they shall endeavor to provide thirty (30) days written notice of any cancellation or reduction in
coverage to both the City and Grantee herein, and a copy of said certificates shall be filed with the City.
Section 4.2 INDEMNIFICATIONS
(a) Grantee shall at his/her sole cost and expense fully indemnify , defend and
save harmless the City , its officers , boards, and employees against any
and all claims , demands , suits, actions, liability and judgments for damage
arising out of the construction, operation and maintenance of the
franchise, and against all liabilities for damages by reason of, or arising out
of, any failure by Grantee to safely operate and maintain the
____________________ , including
reasonable attorney's fees , arising out of the exercise or enjoyment of this
franchise, irrespective of the amount of comprehensive liability policy
required hereunder. This indemnity shall not apply to damages occasioned
solely and exclusively by acts of the City, its agents or employees .
(b) Within thirty (30) days after the granting of the franchise and at all times
during the term of the franchise, Grantee shall obtain, pay all premiums for , and file with
the City executed duplicate copies and receipts evidencing the payment of premiums for
the following :
A general comprehensive public liability insurance policy indemnifying , defending
and saving harmless the City, its officers, boards, agents or employees from any
and all claims by any person whatsoever on account of injury to or death of a
person or persons occasioned by the operations of the Grantee under franchise
herein granted or alleged to have been so caused with a minimum of liability of
_________ for personal injury or death of any two or more persons
in any one occurrence . Renewal certificates of such insurance shall be promptly
forwarded to the City as such renewals are made, and such insurance shall be
kept in force and effect during the term of this grant or franchise . The Grantee
and/or the insurance company shall file with the City a written notice of any
material alteration or cancellation of any insurance coverage at least thirty (30)
days prior to the effective date of such alteration or cancellation. Property damage
insurance indemnifying, defending and saving harmless the City , its officers ,
boards, agents, and employees from and against all claims by any person
whatsoever for property damage occasioned by the operation of a Grantee under
franchise granted by City caused with a minimum liabil ity of
__________ for property damage to two or more persons in any one
occurrence. Said policies of insurance shall name the City as an additional
insured .
(c) All of the foregoing insurance certificates shall be in form satisfactory to
the City and shall be issued and maintained by companies authorized to do business in
the State of Alabama and acceptable to the City and they shall require thirty (30) days
written notice of any cancellation or reduction in coverage to both the City and Grantee
herein, and a copy of said certificates shall be filed with the City .
Section 4.3 BOOKS/RECORDS OF GRANTEE
(a) All books and records of a Grantee concerning its operations within the
City necessary for the enforcement of the provisions of this franchise, shall be made
available for inspection and audit upon demand by the City within thirty (30) days after
any request for such inspection or audit has been made.
Section 4.4 GRANTEE ACKNOWLEDGEMENT
(a) Grantee is an independent contractor. No agency or employment
relationship is created by this Franchise Agreement.
SECTION 5
Section 5.1 SALE OR LEASE OF FRANCHISE
(a)· No transfer or control of the ,'
whether by force or voluntary sale, lease, assignment, fore sure, atta ment, merger,
or any other form of disposition, shall occur or be considered valid without first giving prior
notice and receiving the approval of the City . The notice shall include full identifying
particulars of the proposed transaction. For the purpose of determining whether it shall
consent to such change, transfer, or acquisition of control , the City may inquire into the
qualification of the prospective controlling party and the Grantee shall assist the City in
any such inquiry. The City shall have one 60 days from the date the notice is received
by the City within which to approve or disapprove , by resolution , the proposed transfer of
control. The City will not unreasonably withhold its approval.
(b) Approval of such transfer shall be expressly conditioned upon full
compliance with the material terms of the franchise agreement and this Ordinance . The
transferee shall agree in writing to comply with all provisions of this Ordinance and the
franchise agreement.
Section 5.2 REVOCATON OF FRANCHISE
(1) Subject to the provisions of this section, the City reserves the right to revoke, at
any time , any franchise granted hereunder and rescind all rights and privileges
associated therewith in the event that:
(a) Grantee has not substantially complied with a material provision of
this Ordinance , the franchise agreement, or of any supplemental written agreement
entered into by and between the City and the Grantee; or
(b) Grantee has made a material false statement in the application for
the franchise, knowing it to be false, or Grantee commits a fraud in its conduct or
relations under the franchise with the City ; or
(c) Grantee becomes insolvent , enters into receivership or liquidation ,
files for bankruptcy or assignment for benefits of creditors, or is unable to pay its debts as
they mature , unless the Grantee is in due process of contesting such debts; or
(d) Grantee fails to substantially comply with a material provision of
any federal or state statue, or of any material rules or regulations that govern
telecommunications ; or
( e) Grantee exhibits a pattern of failing to comply with service
standards as adopted herein or in the franchise agreement ; or
(f) Grantee fails to comply with any federal or state judgment
arising directly from the exercise of Grantee's rights under its franchise ; or
(g) Grantee fails to provide or maintain in full force and effect the bond
and insurance policies required by this Ordinance and franchise agreement; or
(h) Grantee assigns , sells or transfers its title or interest in its franchise
without the consent of the City.
(2) In the event that the City shall make a preliminary decision to revoke a franchise
granted hereunder, it shall give the Grantee a minimum of thirty days written notice of its
intention to terminate and stipulate cause. A public hearing shall be scheduled for the end
of said 30-day period. If during said period , the cause shall be cured to the satisfaction of
the City , the City shall declare the notice to be null and void . If the cause is not cured to
the satisfaction of the City , before a franchise may be terminated, the Grantee must be
provided with an opportunity to be heard before the City in a public hearing in accordance
with due process procedures. After the public hearing , if the City , by majority vote,
determines that the franchise should be terminated, it shall issue a written decision
containing its findings of fact and stating the specific grounds for termination. The
decision to terminate a franchise shall be subject to judicial review as provided by law .
(3) A Grantee shall not be declared in default or be subject to any sanction under any
provision of this Ordinance and franchise agreement in any case where the City
determines that the action justifying such sanction is without the Grantee's knowledge or
authorization or outside its control.
Section 5.3 RIGHTS UPON REVOCATION OR NON-RENEWAL
In the event the City determines that a franchise should not be renewed at its
expiration or that a franchise should be revoked for cause as permitted hereunder, the
Grantee shall be allowed three months from the date of such determination, or such
longer period astL the City may permit, to negotiate the sale of its
, be ..-Jc..ir ~ Ll..tJi '~ within the City to another provider at a price
acceptahl o the Grante, provided that such sale shall be approved by the City
pursuant to Section 5 herein . In the event a sale to a provider acceptable to the City is not
then negotiated within the time allowed, then an independent expert shall be appointed to
determine the fair market value of the Grantee's CL . The
appointment of said expert shall be by mutual agreement etween the City and the
Grantee; provided, however, that if the City and the Grantee are unable to reach an
agreement within 30 days of the written decision of termination, then the matter of
appointing an expert shall be submitted, within ten (10) days immediately following
expiration of the former 30 days, to the American Arbitration Association [unless the City
and the Grantee mutually agree upon some other arbitrator(s)], and the expert
designated by the American Arbitration Association or such other arbitrators shall be
appointed. The cost of employing the arbitrator or arbitrators and the cost of arbitration , if
required, shall be borne equally by the Grantee and the City. Upon determination of the
fair market value of the Grantee's I)e,]f.J'g,u \J,"'A.1•v1~ by the
ap ointed independent expert, the Grantee<f shall ~be ¼quired to sell its
_,_...L>.,......._.......,.y......._~<4,i..c:i...:.,;.o.....---to any entity which offers said fair market value and
the approval of the City to purchase said
Section 5.4 REMOVAL AND ABANDONMENT OF PROPERTY (Ju,( qf'e"',...}
(a) If the use of any part of Grantee's ht Juo,,~e__ \Je IJ\e1;~~ is (.o.J\fl O+' 9)
discontinued for an reason for a continuous period of twelve (1 ) months,r if such ~t,::D\~ vA\-0
, does not comply with the requirements of these rules and WO ""~~ .\\~'"'
regulation , or if Gra e 's franchise is terminated or revoked the City may in its ~ t 0 \, ~J-
discretion require that said -be sold to a franchise (.,o c.A v,.N {..
designated by the City at a purchase price equal to the _____ -_-_-_-:_ _____ \91,'J\~(N\1 \ vv a$
fair market value as determined in subsection (b) hereof. (J;l',lc\;\ ~"'
c,.,.\-0..
(b) Any dispute between the City and the Grantee over determination of the
system's fair market value shall be determined in accordance with Section 5.3 above.
Section 5.5 MISCELLEOUS PROVISIONS
{a) This agreement constitutes the entire agreement of the parties and
supersedes any and all agreements , understandings, statements or representations
either oral or in writing . This agreement can be amended only by a written document
signed by the parties .
(b) This agreement shall be enforced and interpreted pursuant to the laws of
the State of Alabama .
IN WITNESSl1~REOF '::e Parties have hereunto set their respective signatures and
seals on the . ~ ay of uiarcb , 20 ~L
TH
Attest: ~/L J/d
~rii;.~MC
City Clerk
Grantee