§ 30-72. Transfer of ownership or control.

(a)

Under this chapter, the contract shall not be assigned or transferred, either in whole or in part, or leased, sublet or mortgaged in any manner nor shall title thereto, either legal or equitable, or any right, interest or property therein pass to or vest in any person without the prior written consent of the city council. The proposed assignee must show financial responsibility as determined by the city and must agree to comply with all provisions of the contract. The company may, however, transfer or assign the contract to a company which is the beneficial owner of all of the company stock or to a wholly owned subsidiary of the company, and such subsidiary may transfer or assign the contract back to the company. However, such transfer may not operate so as to allow either the parent or subsidiary company to evade any financial liability. The city shall be deemed to have consented to a proposed transfer or assignment if its refusal to consent is not communicated in writing to the company within 90 days following receipt of written notice of the proposed transfer or assignment.

(b)

The company shall promptly notify the city of any actual or proposed change in or transfer of or acquisition by any other party of control of the company. The term "control" as used in this subsection is not limited to major stockholders but includes actual working control in whatever manner exercised. A rebuttable presumption that a transfer of control has occurred shall arise upon the acquisition or accumulation by any person or group of persons of ten percent of the shares of the company. Every change, transfer or acquisition of control of the company shall make the contract subject to cancellation unless and until the city shall have consented thereto. For the purpose of determining whether it shall consent to such change, transfer or acquisition of control, the city may inquire into all qualifications of the prospective controlling party, and the company shall assist the city in any such inquiry. Approval for transfer may be withheld by the city if transfer would result in a rate increase attributable to the purchase price paid for the system.

(c)

The consent or approval of the city to any transfer of the company shall not constitute a waiver or release of the rights of the city in and to the streets, and any transfer shall by its terms be expressly subordinate to the terms and conditions of this contract.

(d)

In the absence of extraordinary circumstances, the city will not approve any transfer or assignment of the contract prior to substantial completion of construction of proposed system, except as provided in subsection (a) of this section.

(e)

A transfer of ownership or control shall not be approved without the successor in interest becoming a signatory to this service contract.

(Code 1968, § 7¾-54)