03-1086 Electric Utility Franchise Agreement - Progress Energy

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be open for examination and audit by Grantor and Grantor's representatives during ordinary business hours, and such records shall be retained by Grantee for a period of five (5) years. (E) Audit Grantor may require an audit of Grantee's books not more than once every five (5) years. Grantee will reimburse Grantor's audit costs if the audit identifies errors in Grantee's franchise Base Revenues of five percent (5%) or more for the period audited. Errors identified during the audit process shall be projected for any additional time periods not covered during the audit if there is a reasonable probability these errors occurred during the unaudited period, but not for more than five (5) years. If an underpayment of franchise fees has occurred, interest will be computed at a rate of ten percent (10%) per annum. Both the underpayment and interest shall be paid within thirty (30) days after receipt of demand therefor from Grantor. SECTION 11. Term of Franchise And Associated ODtion To Purchase Grantee's Electric Facilities Except as otherwise provided herein, the Franchise and rights herein granted shall take effect and be in force from and after the final passage hereof, as required by law and upon the filing of an acceptance by Grantee of all the terms thereof with Grantor and shall continue in force and effect for a term of thirty (30) years after the effective date of this Franchise ordinance. At the end of such thirty (30) year term, as provided below, Grantor shall have the right to purchase Grantee's facilities and "associated facilities" located within Grantor's municipal boundaries, except high tension transmission lines, generating plants, and facilities used to provide service to communities, other than the Grantor, as provided in this Section. "Associated Facilities" shall include those portions of the substations in the City necessary to receive wholesale bulk service from the City's provider. Any exercise by Grantor of the purchase rights under this Section shall require Grantor to purchase all facilities subject to purchase and not a portion thereof THE PARTIES MUTUALLY DECLARE AND ACKNOWLEDGE TIIAT THE 30-YEAR TERM OF TIllS FRANCHISE AND THE GRANTOR'S RIGHT TO PURCHASE ARE INEXTRICABLY LINKED, AND THAT GRANTEE WOULD NOT HAVE AGREED TO GRANT THE RIGHT TO PURCHASE HEREIN BUT FOR THE FACT TIIAT TIllS FRANCHISE PROVIDES FOR A 30-YEAR TERM. THE PROVISIONS OF THIS SECTION II ARE NOT SEVERABLE FROM EACH OTHER (A) Initiation of Purchase Procedures. Grantor must give notice of its desire to initiate purchase procedures for a possible purchase no later than three (3) months prior to the expiration of this franchise If Grantor does not give such timely notice, Grantor's right to purchase shall expire and be of no further force and effect. If Grantor does give such notice to Grantee, such notice will cause no disruption of service to Grantee's customers within the City. (B) Attempts to Agree on Purchase Price. If such notice is timely given, the parties shall first meet and attempt to negotiate an agreed purchase price for such facilities. As part of the negotiations Grantee shall provide Grantor with Grantee's 7