Minutes 01/22/1980 - Laserfiche WebLink

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3'72 January 22, 1980 80-47 Vice Mayor Holley offered the £ollowing nominations for appointments to the following Boards/Commissions: Jail Advisory Board Daniel W. Duncan, Isabel Brenner, Jr., George D. Eastes for a three year year term. Juvenile & Domestic Ralph W. Gholson for a 2 year term; Har~ey N. Johnson, term; Phyllis-Angus, WiIliam S. Moore, Jr. for a four Relations Court-Advisory Council Mrs. Joseph C. Hathaway (Miriam D.) for an~unexpired term, ending January 1, 1981, replacing Mrs. Thomas R. Green. Motion of Mr. Barnes and seconded hy Mr. Oast, further nominations, the above members to be elected and was adopted by unanimous vote. to close nominations, and there being to the designated Board~[Commission, no Mayor Davis relinquished the Chair to Vice Mayor Holley for the following item: 80-48 The following letter received from Cox Cable of Portsmouth, Inc., Signed by David P. Fleming, Its Attorney" "On behalf of Cox Cabl~e of Portsmouth, Inc. ('Cox Cable') and pursuant to Section 6 1/2 13 of the Code of the City of Portsmouth, this will request Council approval of the transaction described herein~ Cox Cable is 80% owned by Cox Cable Communications, Inc.('CCCI'), which is wholly-owned ~ by Cox Broadcasting Corporation ('CBC'). CBC and General ~lectric Company ('GE') have executed an Agreement and Plan of Merger (Merger Agreement) pursuant to which a wholly-owned subsidiary of GE will be merged into ~BC; CBC will become a wholly-owned subsidiary of GE and will con- ~ tinue to operate from its present headquarters with no material change in the management and operation of the cable system. Alternatively, the Merger Agreement provides that the parties may choose to merge CBC into a GE Subsidiary (formed solely for the purpose of the Merger) with result that the GE Subsidiary will be the surviving corporation in the Merger holding all CBC's assets and operating its business from CBC's present headquarters as a wholly-owned subsidiary of GE. In either event, upon consummation of the proposed merger, GE will become the ultimate controlling corporate entity of Cox Cable. Section 6 1/2 13 of the Code provides in part that approval of the Council ~s required prior to a transfer of control of the 'franchise' (Cox Cable). Since ultimate control over 80% of the stock of Cox Cable is being acquired by GE, we are hereby requesting Council approval with regard to the proposed transaction. It is important to note that neither the franchise held by Cox Cable nor°the operational rights thereto are being transferred or assigned. There will be no material change in the management and operation of the cable conpany. The citizens of Portsmouth will continue to receive the same high quality CATV service to which they have become accustomed and the com- Fany will, of course, continue to comply with all of its franchise obligations. Th~s, in all respects, the proposed transaction involves matters not directly affecting the operation of the cable ~elevision system in Portsmouth. It should be noted that the state agencies re- gulating CATV operations in New Y6rk and Connecticut have both approved the proposed trans- action insofar as it may affect control of Cox's CATV system in those states. Accordingly, it is respectfully requested that the Council grant its approval of the proposed transactinn. A form of resolution to that effect is submitted herewith for the consideration of the City Attorney and Council. Because the proposed Merger is subjeet~to the approval of the Federal Communications Commission~ completion of the transaction ~s not expected until the end of the [irst quarter of 1980. As a result i~ is Yequested that the consent granted herein be valid £or a period of sixty (60) days following the receipt of fins approval of the merger from the FCC. One additional point should be made in connection with the proposed merger. S~ction 6 1/2 -36 of the Code provides as~£ollows: The franchisee shall not en~age in the business o£ installing or leasing television or radio receivers permissmon is granted therefor by the council. selling, servicing, unless specific Thus, by its terms, the prohibition applies only to Cox Cable, which does nat engage in these practices. Insofar as G~ is concerned, GE does not engage in the direct sale or lease telev~&on sets to memberseof the general public but does sell sets to hotels, motels and ~f other like large users. G~ does maintain factory service operations ('GE Service Centers') in various part of the country for the repair of_~Ceneral glectric television sets and numerou other appliances. None of these centers, however, is lccated in Portsmouth. In addition, as a matter of explicit company policy GE's CATV systems do not engage in the leasing, sale or servicing of television sets and this rigid Folicy will be adhered to by the Cox systems following the merger. Accordingly, Cox Cable ~es not believe that Section 6 1/2 36 of the Code, which prohibits the franchisee from~selling or repairing television receivers, is ap- plicable to the situation where one of the many business endeavors of the ultimate controllin entity (several steps removed) of the franchisee is the servicing of television sets and wher the actual franchisee will in no way engage ~n such activities." Motion of Mr. Gray and seconded by Mr. Oast, that the matter Cable Televsion Commission £or recommendation, and was adopted by vote~ to be referred to the 6-0-1(Davis-abstaining)