Revocation and termination.

Memphis Code of Ordinances § 6-28-27

in effect

Sec. 6-28-27. - Revocation and termination. A. In addition to all other rights and powers retained by the city under this chapter or otherwise, the city reserves the right to revoke and terminate any franchise issued by authority of this chapter, and all rights and privileges of grantee hereunder shall cease in the event of substantial breach, subject to reasonable notice and opportunity to cure, of its terms and conditions. A substantial breach of grantee shall include, but shall not be limited to, the following: 1. Grantee's violation of any material provision of this chapter or any material rule, order or regulation of the city made pursuant to this chapter; 2. Grantee's failure to properly compensate the city as required in this chapter; 3. Grantee's attempt to evade any material provision of the franchise ordinance or to practice any fraud or deceit upon the city or upon grantee's end-user customers or interexchange carrier; 4. Grantee's failure to be capable of providing actual services to its initial end-user customers within 12 months from the date of the award of grantee's franchise, unless otherwise authorized or extended by the council; 5. Grantee's failure to complete its construction and provide service as described in section 6-28-5 of this chapter; 6. For failure to file and maintain the bond, security or insurance required under this chapter; 7. Grantee's attempt to sell, resell, transfer, convey or assign any of the rights and privileges granted pursuant to this chapter within one year after the passage of the ordinance from which this chapter derives; 8. Grantee's attempt to sell, transfer, convey or assign any of the rights and privileges granted pursuant to this chapter without council approval; 9. Grantee's failure to respond to or comply with reports, audits, statements and other information lawfully requested by the city; 10. Any material cessation in the operation of grantee's system for six months after it has been constructed; or 11. Grantee's material misrepresentation of fact in its application or negotiations during the franchise process; or the conviction of any director, officer, employee or agent of grantee for the offense of bribery or fraud connected with or resulting from the award of the franchise to grantee. B. The foregoing shall not constitute a substantial breach if the violation occurs without the fault of grantee or occurs as a result of circumstances beyond its control. Grantee shall not be excused by mere economic hardship, nor misfeasance or malfeasance of its directors, officers or employees. Revocation or termination shall only take place for material cause. C. Upon expiration of the term of the franchise agreement or upon any other termination therefor as provided herein, or by application for approval of transfer of the entire franchise or a majority interest thereof, the city at its election and upon the payment to the grantee of a price equal to the fair market value of the system shall have the right to purchase the system and all interests therein as the city's sole and absolute property. In the event of dispute between city and grantee of what is fair market value, the dispute shall be submitted to arbitration pursuant to provisions of T.C.A. § 29-5-101 et seq. In such event, the city and grantee shall each appoint an arbitrator and a third arbitrator all be appointed by the arbitrators so appointed. Each arbitrator shall have at least five years of experience in the field of rights-of-way procurement. Pursuant to the then-current rules of the American Arbitration Association, or any successor organization, an arbitration shall be held as expeditiously as possible. If the city has exercised its option to purchase at fair market value, it shall have the right to assume operation of the system even though the final award has not been made by the arbitrators or as approved by the court. This right of first refusal for purchase shall also include the right to purchase for the price offered to the grantee. In the event that there is a contemplated sale of the system or majority interest thereof, or upon the termination as provided herein, or by law, the city must exercise its option within 30 days. In the event the grantee has petitioned the city for renewal and renegotiation of its franchise as provided herein, the city must exercise its option to purchase the system within 30 days of the requested renewal or renegotiation or at least six months prior to the end of the franchise, whichever is later. Nothing shall prohibit the grantee in the event of the election of the city to purchase the system from requesting the court to set a reasonable bond of the city to secure the purchase price. The grantee shall execute such warranty deeds and other instruments as may be necessary. (Code 1985, § 10-163; Ord. No. 4398, § 28, 11-19-1996)

Source: City of Memphis, Code of Ordinances and Charter and Related Laws (Municode Library, library.municode.com)URL: https://library.municode.com/tn/memphis/codes/code_of_ordinances?nodeId=TIT6BULIRE_CH6-28FIOPTEREFR_S6-28-27RETEFetched: 10/28/2026