Appendix B · Franchises

Ordinance No. 941 (Gas)

AN ORDINANCE GRANTING KANSAS GAS SERVICE, A DIVISION OF ONE GAS, INC., A CONTRACT FOR A NATURAL GAS FRANCHISE TO CONSTRUCT, OPERATE, AND MAINTAIN ALL FACILITIES NECESSARY OR PROPER FOR THE TRANSMISSION, TRANSPORTATION, DISTRIBUTION, SUPPLY, AND SALE OF NATURAL GAS TO CONSUMERS; GRANTING THE RIGHT AND PRIVILEGE TO USE THE RIGHT-OF-WAY FOR SAID PURPOSE; PRESCRIBING THE TERMS AND CONDITIONS OF SUCH FRANCHISE; AND REPEALING ORDINANCES OR PARTS OF ORDINANCES INCONSISTENT WITH SAID PURPOSE.

I. RECITALS

WHEREAS, Kansas Gas Service, a division of ONE Gas, Inc. (“Company”), an Oklahoma corporation, holds a Certificate of Public Convenience and Necessity from the State Corporation Commission of the State of Kansas to operate as a natural gas public utility within the State of Kansas; and

WHEREAS, Company owns and operates a system for the transmission, transportation, distribution, supply, or sale of natural gas in the State of Kansas, and has built, or proposes to build, natural gas Facilities within and through the City of Douglass, Kansas (“City”) for those purposes; and

WHEREAS, City and Company both desire that Company sell or furnish natural gas to the inhabitants of City; and

WHEREAS, K.S.A. 12-2001, as amended, authorizes City, by ordinance, to contract with Company for a franchise to sell or furnish natural gas to the inhabitants of City, and to grant Company the right and privilege to use the streets and alleys of City for that purpose;

NOW, THEREFORE, IN CONSIDERATION OF THE BENEFITS TO BE DERIVED BY CITY AND ITS INHABITANTS, BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF DOUGLASS, KANSAS:

II. DEFINITIONS

In this Franchise, the following words and phrases have the meanings given below. Words used in the present tense include the future tense, and words in the singular include the plural. The word “shall” is always mandatory and not merely permissive.

A. “City” means the City of Douglass, Kansas, and, where the context is appropriate, each of its departments, divisions, and component units, including any public trust or authority of which the City is a beneficiary.

B. “Company” means Kansas Gas Service, a division of ONE Gas, Inc., and its successors and permitted assigns.

C. “Effective Date” means the date Company submits its written acceptance of this Franchise with City, following City’s final passage and approval of this Franchise.

D. “Facilities” means natural gas transmission and distribution facilities located in the Public Ways, including, but not limited to, mains, pipes, pipelines, services, laterals, conduits, valves, boxes, regulating and reducing stations, and related equipment or appurtenances, used to transmit, transport, distribute, supply, or sell natural gas.

E. “Franchise” means the right and privilege granted to Company under this Franchise Ordinance to use City’s Public Ways to transmit, transport, distribute, supply, or sell natural gas to City and its inhabitants, through City and beyond its limits, and to do all things necessary or proper to carry on that business.

F. “Franchise Fee” means the fee Company pays to City under this Franchise.

G. “Franchise Ordinance” means this Ordinance, which contracts with and grants to Company a natural gas Franchise.

H. “Gross Receipts” means all money Company actually collects from the sale or transportation of natural gas within the corporate limits of City. Gross Receipts do not include: connection, disconnection, or reconnection fees; temporary service charges; late-payment or delayed-payment charges; collection fees; bad debts; customer project contributions; meter-test fees; amounts collected from customers as reimbursement of the Franchise Fee; returned-check charges; or credit extended under the Cold Weather Rule (or any substitute rule) of the Kansas Corporation Commission.

I. “Person” means any natural person, and any entity of any kind, including a corporation, limited liability company, partnership, joint venture, association, trust, or other legal or commercial organization. “Person” also includes any federal, state, or local governmental entity, including any agency, department, authority, commission, political subdivision, or instrumentality thereof.

J. “Public Improvements” means any public facility, building, or capital improvement, including, without limitation, streets, alleys, sidewalks, sewers, water and drainage facilities, and other right-of-way improvements that is planned, constructed, reconstructed, maintained, or repaired by City or another governmental entity, or otherwise paid for with public funds.

K. “Public Way” or “Public Ways” means the area on, below, or above the present and future public streets, avenues, alleys, bridges, boulevards, roads, highways, parks, parking areas, sidewalks, and other public areas, and general utility easements that are dedicated to or acquired by City. Public Ways do not include easements obtained by private entities providing utility services, or private easements in platted subdivisions or tracts.

L. “Sales Customer” means any Person located within the corporate limits of City that purchases natural gas from Company for delivery to that Person within City through Company’s Facilities.

M. “Transportation Customer” means any Person located within the corporate limits of City that purchases natural gas from a supplier other than Company and receives transportation service from Company for delivery of that natural gas to that Person within City through Company’s Facilities.

III. FRANCHISE

A. Grant of Franchise. In consideration of the benefits to City and its inhabitants, City grants Company a non-exclusive Franchise to lay, construct, extend, maintain, alter, inspect, repair, replace, protect, relocate, change the size of, operate, and remove Facilities along, across, over, upon, and under City’s Public Ways. Company may use this Franchise to transmit, transport, distribute, supply, or sell natural gas to City and its inhabitants, through City and beyond its limits, and to do all things necessary or proper to carry on that business.

B. Term of Franchise. A period of ten (10) years from the Effective Date.

C. No Title to Public Ways. This Franchise does not convey any title, legal or equitable, in City’s Public Ways to Company. It gives Company only the right and privilege to occupy City’s Public Ways for the purposes and the period stated in this Franchise.

D. Exclusions. This Franchise does not:

1. Authorize Company to use facilities or personal property owned or controlled by City or a third party without that party’s consent;

2. Authorize Company to lay, construct, extend, maintain, alter, inspect, repair, replace, protect, relocate, change the size of, operate, or remove Facilities on City property other than City’s Public Ways;

3. Excuse Company from obtaining the appropriate access or attachment agreements before locating Facilities on property owned or controlled by City or a third party, other than City’s Public Ways; or

4. Except as expressly stated in this Franchise, excuse Company from obtaining any permit, license, certification, grant, registration, or other authorization required by any body with jurisdiction over Company.

E. Competitively Neutral. Company is authorized to use City’s Public Ways in an equitable, competitively neutral, and non-discriminatory manner for the purposes and period stated in this Franchise.

F. Proprietary and Administrative Nature. City and Company agree that this Franchise reflects a bargained-for contractual exchange of consideration, including payment of the Franchise Fee for Company’s use of City’s Public Ways. In entering into this Franchise, City acts in its proprietary and administrative capacity with respect to the use of its property and the receipt of compensation for that use.

IV. COMPENSATION

A. Compensation for Franchise. In consideration of this Franchise, Company shall pay City, for the term of this Franchise, a Franchise Fee equal to:

1. Six percent (6%) of the actual Gross Receipts Company collects from the sale of natural gas to its Sales Customers located within the corporate limits of City; and

2. Six percent (6%) of the actual Gross Receipts Company collects from the transportation of natural gas to its Transportation Customers located within the corporate limits of City.

B. Payment Schedule. On a monthly basis, Company shall pay City the Franchise Fee, for the preceding monthly period.

C. Payment Obligation. Company’s obligation to pay the Franchise Fee shall begin with the first monthly billing cycle following the Effective Date. Before the Effective Date, Company shall continue to calculate and pay City the compensation provided in Ordinance No. 745, and amendments thereto.

D. No Additional Fees. The Franchise Fee is full and reasonable compensation to City for Company’s use and occupancy of the Public Ways during the term of this Franchise. Except as expressly provided in this Franchise, the Franchise Fee is in lieu of any separate tax, charge, assessment, license, or fee that City might otherwise impose for the right to use or occupy its Public Ways. Any fee otherwise imposed by ordinance for a permit or other use of the Public Ways is included within the Franchise Fee and shall not be separately assessed or collected from Company during the term of this Franchise. Except as provided in Section VI(C), if City requires Company, or a contractor, subcontractor, or agent acting on Company's behalf, to pay any permit fee, application fee, review fee, inspection fee, or similar charge in connection with activities authorized by this Franchise, including as a condition of submitting or processing a permit application through an electronic permitting system, City shall promptly refund such fee or charge to Company upon Company's request and submission of reasonable documentation of the payment. Nothing in this Article limits City’s authority to enforce procedural or administrative requirements governing use of the Public Ways, including permitting, inspection, traffic control, and restoration standards, which Company shall comply with. Notwithstanding, Company shall be responsible for City’s reasonable, actual, and verifiable costs directly caused by Company’s activities in the Public Ways, including the cost of repairing or restoring City’s Public Ways damaged by Company. Such costs are not Franchise Fees, and City may recover them separately.

E. Proration. If a Sales Customer or Transportation Customer does not pay a monthly bill from Company in full, Company shall prorate the Franchise Fee remitted to City on such bill. The amount the Sales Customer or Transportation Customer actually pays shall be applied proportionally to all charges on the bill, and Company shall remit to City the same proportion of the Franchise Fee as the amount paid bears to the total bill. If Company later collects any remaining amounts due on such bill, Company shall remit to City its proportional share of the Franchise Fee on those additional amounts.

F. Audits and Corrections. Upon City’s written request, Company shall provide a statement showing how the Franchise Fee was calculated. Under K.S.A. 12-2001, as amended, City may examine, at all reasonable times, all books, receipts, files, records, and documents of Company necessary to verify such statement and to correct it if it is found to be wrong. If the statement showing how the Franchise Fee was calculated is incorrect, Company shall pay any additional amount owed, or City shall refund any overpayment, based on the corrected statement. City’s acceptance of any Franchise Fee is not an agreement that the amount paid is correct, and is not a release of any claim of City.

V. USE OF CITY’S PUBLIC WAYS

A. Authorized Uses. Company may lay, construct, extend, maintain, alter, inspect, repair, replace, protect, relocate, change the size of, operate, or remove natural gas transmission and distribution Facilities along, across, over, upon, and under City’s Public Ways, for the purpose of transmitting, transporting, distributing, supplying, or selling natural gas to City and its inhabitants, through City and beyond its limits, and to do all things necessary or proper to carry on that business.

B. Company’s Use Subordinate to City’s Use. Except as provided in this Franchise, or as regulated by state or federal law, Company’s use of City’s Public Ways shall be subordinate to City’s use or occupation of its Public Ways for any public purpose. City may exercise its home rule powers in managing and regulating its Public Ways, provided that any such exercise is competitively neutral and is not unreasonable or discriminatory. Company shall construct and maintain its Facilities so they do not unreasonably obstruct or hinder ordinary travel, public safety, or the lawful use of City’s Public Ways by other utilities.

C. Applicable City Code. Except as provided in this Franchise, or as regulated by state or federal law, Company’s use of City’s Public Ways is subject to all City ordinances, policies, regulations, and rules now in effect or later adopted. Nothing in this Franchise, however, waives Company’s right to oppose, challenge, or seek judicial review of any such ordinance, policy, regulation, or rule.

D. Interference. Company shall locate its Facilities within City’s Public Ways so they do not obstruct or interfere with City’s water pipes, drains, sewers, other structures, or Public Improvements already installed within the Public Ways.

E. Permits. Except in an emergency, Company shall obtain any necessary permit before it constructs, reconstructs, repairs, maintains, or relocates its Facilities within City’s Public Ways. Company shall use any standard permit form City prescribes and shall comply with all City ordinances, policies, regulations, and rules now in effect or later adopted that govern the information required in a permit application and the procedures for obtaining permits; provided, however, that no permit shall be conditioned on payment of an additional fee. Any permit fee or other charge paid in connection with a permit application submitted by Company, or by a contractor, subcontractor, or agent acting on Company's behalf, shall be subject to refund as provided in Section IV(D).

F. City’s Use of Public Ways. City reserves the right to lay, or permit to be laid, cables, electric conduits, water, sewer, gas, or other pipelines, and to perform or permit any underground work it deems necessary and proper, along, across, over, or under any Public Way. In permitting such work, City shall not be liable to Company for any damage to Company’s Facilities unless, and only to the extent to, such damage is caused by the negligence or willful misconduct of City or its officers, employees, agents, contractors, or subcontractors.

G. Facility Relocation; Generally. Whenever, because of establishing or changing the grade of any street, or the location or manner of construction of any Public Way, City determines it is necessary to alter, change, adapt, or conform any portion of Company’s Facilities located in the Public Way, City shall give Company reasonable notice. Company shall relocate its affected Facilities within a reasonable time, not less than one hundred eighty (180) days after receiving final plans and notice to relocate without claim for reimbursement or compensation for damages against City. Notwithstanding the foregoing, City may request that Company complete a relocation in less than one hundred eighty (180) days after receipt of final plans and notice to relocate. Company shall use commercially reasonable efforts to complete the relocation within the time requested by City; provided however failure to complete the relocation within the requested time shall not constitute a breach of this Franchise, negligence, or other wrongful conduct by Company, shall not be grounds for revoking this Franchise, and Company shall not be liable to City or any third party for any costs, claims, expenses, penalties, damages, delay damages, or other liabilities arising from or related to Company's inability to satisfy the requested relocation schedule. This provision does not require Company to alter, change, adapt, or conform any portion of its Facilities without reimbursement or compensation where Company acquired the right to locate them, whether by private right-of-way grant, utility easement, or otherwise, before the location was designated a Public Way.

H. Facility Relocation; Private or Economic Development. If City requires Company to adapt, conform, alter, relocate, or change its Facilities or property to enable any Person, other than City, to use the Public Way that Person shall reimburse Company for any and all loss, cost, or expense caused by the change. As used in this paragraph, “Person” does not include the regular departments of City, or any trust or authority formed by or for the benefit of City for public utility purposes. “Person” does include any other agency or authority of City, whether acting in a governmental or non-governmental capacity, including, without limitation, any urban renewal authority or any other agency or authority that, as part of its program, clears whole tracts of land within the municipal corporate limits or relocates citizens for purposes of urban development or similar aims.

I. Facility Location; Coordination. Company shall participate in the Kansas One-Call utility location program and shall mark its Facilities within City’s Public Ways in accordance with the Kansas Underground Utility Damage Prevention Act, K.S.A. 66-1801 et seq., as amended. Company shall cooperate promptly when City requests information about the location of Company’s Facilities within City’s Public Ways. Company shall designate and maintain an agent who is familiar with its Facilities and responsible for providing the timely information City needs to design, place, and relocate Company’s Facilities within City’s Public Ways.

J. Facility Relocation; Repeat. Company shall pay for the first relocation of its Facilities required under Section V(G). If City requires Company to relocate the same Facilities again within five (5) years after that relocation is completed, City shall reimburse Company for the full cost of the later relocation.

VI. NOTICE OF WORK AND DUTY TO REPAIR

A. Notice of Work; Required Information. Except in an emergency, before Company begins any construction, maintenance, or extension of its Facilities within City’s Public Ways that requires excavation, Company shall provide information about the work to be performed. City may require this information on its standard permit form. In an emergency, Company may begin work without first providing the information, but shall submit it within five (5) business days after beginning the work.

B. Restoration Obligation. Before beginning any construction, maintenance, or extension work on its Facilities within City’s Public Ways, Company shall inspect existing conditions within and adjacent to the work area and report any existing damage or concerns to City. If Company damages, displaces, or removes any earth, materials, sidewalks, pavement, crossings, utilities, Public Improvements, or other improvements within City’s Public Ways, Company shall fully repair or replace them so they are in the same or better condition than before the work began. All repair and replacement work shall comply with City’s municipal standards then in existence, shall be completed in a manner satisfactory to City’s authorized representative, shall be performed after Company completes the work permitted under this Franchise, and shall be performed without cost to, or reimbursement from, City.

C. Costs Chargeable to Company. Company is subject to the following fees and costs in connection with its use and occupancy of any Public Way:

1. If Company has not timely completed a repair or replacement required by this Article, City may charge Company its standard permit fee, or another comparable fee set by City ordinance, for each area impacted, to recover the costs of the construction and repair activity;

2. Repair and restoration costs to repair or restore City’s Public Ways because of damage caused by Company that Company does not timely repair or restore; and

3. Inspection fees to recover all reasonable, actual, and verifiable costs of City’s inspection of Company’s work in City’s Public Ways, when the Facilities are of such scope and magnitude that City must incur those inspection costs through an outside party.

VII. INDEMNIFICATION

A. Responsibility. It shall be the responsibility of Company to take reasonable and proper precautions to protect and defend its Facilities in the Public Ways from harm or damage. If Company fails to accurately or timely locate Facilities when requested, in accordance with the Kansas Underground Utility Damage Prevention Act, K.S.A. 66-1801 et seq., as amended, it has no claim for costs or damages against the City and its authorized contractors unless such parties are responsible for the harm or damage by its negligence or intentional conduct. The City, its officers, employees and its authorized contractors, or subcontractors shall be responsible for taking reasonable precautionary measures, including but not limited to, calling for utility locations and observing marker posts when working near Company's Facilities.

B. Indemnification. Company shall indemnify and hold City and its officers and employees harmless against any and all claims, lawsuits, judgments, costs, liens, losses, expenses, fees (including reasonable attorney fees and costs of defense), proceedings, actions, demands, causes of action, liability and suits of any kind and nature, including personal or bodily injury (including death), property damage or other harm for which recovery of damages is sought, to the extent that it is found by a court of competent jurisdiction to be caused by the negligence of Company, any agent, officer, director, representative, employee, affiliate or subcontractor of Company, or its respective officers, agents, employees, directors or representatives, while installing, repairing or maintaining Facilities in the Public Ways.

C. Exclusion. The indemnity provided by this section does not apply to any liability resulting from the negligence of the City, its officers, employees, contractors or subcontractors. If Company and the City are found jointly liable by a court of competent jurisdiction, liability shall be apportioned comparatively in accordance with the laws of the State of Kansas without, however, waiving any governmental immunity available to the City under state law and without waiving any defenses of the parties under state or federal law. This section is solely for the benefit of the City and Company and does not create or grant any rights, contractual or otherwise, to any other Person.

D. Notice of Claims. Company or City shall promptly advise the other in writing of any known claim or demand against Company or the City related to or arising out of Company’s activities in the Public Ways.

VIII. RULES AND REGULATIONS FOR COMPANY’S SERVICES

Company may make and enforce reasonable rules and regulations it considers necessary for extending its Facilities, selling or furnishing natural gas, and prudently conducting its business, provided that those rules and regulations do not conflict with the laws of the State of Kansas or with the orders, rules, or regulations of the Kansas Corporation Commission or other regulatory authority having jurisdiction over Company.

IX. INSURANCE REQUIREMENTS

A. Term; Coverage Required. During the term of this Franchise, the Company shall maintain insurance coverage at its sole expense with financially reputable insurers authorized to do business within the State of Kansas. The Company shall provide the following insurance:

1. Workers’ compensation as provided for under any worker’s compensation or similar law in the jurisdiction where any work is performed with an employers’ liability limit equal to the amount required by law.

2. Commercial general liability, including coverage for contractual liability and products completed operations liability on an occurrence basis or a claims made basis, with a limit of Two Million Dollars combined single limit per occurrence for bodily injury, personal injury, and property damage liability. The City shall be included as an additional insured with respect to liability arising from the Company’s operations under this Franchise.

3. Auto Liability Insurance with limits of insurance of $1,000,000 Combined Single Limit for bodily injury and property damage covering ownership or use of all owned, hired and non-owned autos used in connection with the operations and activities authorized pursuant to this Franchise.

B. Self-Insurance Authorized. As an alternative to the above insurance requirements, if self-insurance is allowed by state law for one or more of the required coverages, Company may present certificate or permit of self-insurance issue by state to satisfy the insurance requirement(s) of this Article.

X. REVOCATION

A. Grounds for Revocation. City may revoke this Franchise if Company (a) fails to comply with its provisions or (b) performs or permits any act prohibited by or in violation of this Franchise.

B. Opportunity to Cure. Before City may revoke this Franchise, City shall give Company written notice describing the alleged failure or violation. Company shall have sixty (60) days from the date of the notice to cure the identified issue. If Company has not cured the failure or violation within that sixty (60) day period, City may proceed with revocation.

C. Extended Cure Period. If the default cannot reasonably be cured within sixty (60) days, Company shall be entitled to an automatic extension for a reasonable additional period, provided that within the sixty (60) day period Company (a) has taken reasonable steps to begin curing the default and (b) is diligently pursuing completion of the cure.

D. Governing Body Action. Revocation must be approved by an affirmative vote of the governing body present and voting at a public meeting, with the grounds for revocation stated in the action. Before the governing body acts, Company (a) shall receive reasonable notice of the date, time, and location of the meeting and (b) shall have the right to address the governing body.

E. Reservation of Remedies. Nothing in this Article limits either party’s right to pursue any other remedy available at law.

F. Appeal Period. If the governing body votes to revoke this Franchise, Company shall have thirty (30) days to appeal the decision to (a) the District Court of the county where City is located or (b) the District Court of Johnson County, Kansas.

G. Effectiveness of Revocation. Revocation becomes effective at the end of the thirty (30) day appeal period, unless Company timely files an appeal.

H. Status Pending Appeal. If Company timely appeals, revocation is stayed pending the court’s final judgment.

I. Force Majeure; Legal Proceedings Exception. Revocation shall not be based on failures or violations caused by events beyond Company’s control or by bona fide legal proceedings.

XI. RESERVATION OF RIGHTS

A. City Retention of Legal Powers. By agreeing to enter into this Franchise with Company, City does not waive any of its legal, regulatory, or governmental rights or powers under: (a) the laws of the State of Kansas, as amended; (b) applicable federal laws or regulations, as amended; (c) City’s home rule authority under the Constitution of the State of Kansas; or (d) any existing or future ordinances of City.

B. Reservation of Rights by Both Parties. By agreeing to this Franchise, City does not waive or prejudice any of its current or future legal rights, positions, claims, arguments, or remedies. By agreeing to this Franchise, Company likewise does not waive or prejudice any of its current or future legal rights, positions, claims, arguments, or remedies. City and Company each expressly reserve all rights and remedies available at law or in equity, including the right to challenge, defend, support, oppose, or take any position regarding the legality or appropriateness of any current or future laws, non-franchise ordinances, regulations, orders, rulings, or other governmental actions.

XII. ACCEPTANCE

A. Acceptance; Effective Date; Contract Formation. City’s passage and approval of this Franchise is City’s exercise of its proprietary or administrative authority to offer the Franchise on the terms stated herein. Company accepts that offer by submitting a written acceptance with the City Clerk.

B. Time to Accept. Company shall submit its written acceptance within sixty (60) days after City’s final passage and approval of this Franchise, unless the failure to do so results from excusable neglect by either City or Company. A late acceptance due to excusable neglect does not automatically void this Franchise, and by submitting its written acceptance, Company accepts the provisions, terms, and conditions of this Franchise.

C. When Effective. This Franchise becomes effective after passage and approval by City, acceptance by Company, and publication in the official City newspaper. Once Company submits its written acceptance, this Franchise and Company’s acceptance together constitute a contract between City and Company, effective as of the date Company submits its acceptance with City.

D. Entire Agreement; Binding Effect; Amendments. Once accepted by Company, this Franchise is the entire agreement between City and Company regarding this Franchise. It supersedes all prior oral or written understandings, agreements, representations, or negotiations regarding the same subject matter.

E. Binding Agreement. This Franchise is binding on City and Company and on their respective successors and assigns. It may not be amended, and no additional obligations may be imposed, unless both parties consent in writing.

XIII. REOPENER

A. Review of Franchise Fee. Either City or Company may request a review of the Franchise Fee after the first five (5) years of this Franchise, and once every five (5) years after that. The requesting party shall give the other party written notice at least one hundred twenty (120) days before the end of the applicable five-year period. The notice shall specifically identify the requested changes to the Franchise Fee. After receiving a timely request, City and Company shall negotiate in good faith on a mutually acceptable amendment to the Franchise Fee.

B. Change in Law. At Company’s written request, this Franchise shall be reopened and renegotiated at any time if a change in federal, state, or local law, regulation, or order materially affects Company’s rights or obligations. This includes, without limitation, changes affecting the scope of the Franchise granted to Company or the compensation payable to City.

C. Comparable Fee. The Franchise Fee shall not exceed the percentage rate later approved for any fee paid to City by another public utility for use of the Public Ways, if that fee is based in any way on revenues or gross receipts from the sale, transportation, or distribution of natural gas or electric energy to customers within City. This comparison does not include fees paid by a municipally owned electric utility. If, after the Effective Date, another public utility selling, transporting, or distributing natural gas or electric energy in City is required to pay a lower percentage-based fee than the Franchise Fee, then, upon notice from Company, this Franchise shall automatically reopen to negotiate a lower Franchise Fee percentage rate.

XIV. ANNEXATIONS

City shall promptly notify Company in writing, and provide a map, of areas newly annexed into or deannexed from the corporate limits of City, and Company shall update its records for purposes of paying Franchise Fees as soon as reasonably practicable after receiving such notice. Notwithstanding anything to the contrary in this Franchise, Franchise Fees shall not take effect within any annexed area until the beginning of the monthly billing cycle that begins no more than sixty (60) days after City provides Company with a certified copy of the annexation ordinance, proof of publication as required by law, and a map of City detailing the annexed area.

XV. AUTHORITY TO CONTRACT FOR FRANCHISE

This Franchise is granted under K.S.A. 12-2001, and amendments thereto. Any ordinances or parts of ordinances in conflict with the terms of this Franchise Ordinance are repealed, or treated as having no effect, as of the first monthly billing cycle following the Effective Date of this Franchise.

XVI. TRANSFER AND ASSIGNMENT

Company shall not assign, sell, lease, or otherwise transfer, in any manner, to any third party not affiliated with Company the rights and privileges granted under this Franchise, except as provided below. Any assignment, sale, lease, or other transfer by Company of the Franchise to any third party not affiliated with Company is ineffective and void unless:

1. The proposed assignment, sale, lease, or transfer is in writing;

2. The prospective assignee, buyer, lessee, or other transferee agrees in writing to accept and become responsible for full performance of all conditions, covenants, obligations, and liabilities in this Franchise; and

3. Such writing is submitted to the City Clerk.

XVII. NOTICES

Company shall at all times maintain with City a local point of contact who is available at all times to act on behalf of Company in an emergency. Company shall provide City with that local contact’s name, address, telephone number, fax number, and email address. Either party may give the other emergency notice by telephone to the designee listed below. All other notices between the parties shall be in writing and shall be made by personal delivery, by deposit in the U.S. Mail, by Certified Mail (return receipt requested), or by the email addresses provided below. Any notice served by U.S. Mail or Certified Mail (return receipt requested) is deemed delivered upon actual receipt, unless otherwise provided. Except for emergencies, notices to the parties shall be sent to the following:

City:	Company:
The City of Douglass Attn: City Administrator Douglass, Kansas 67039 Phone: 316-747-2109 Fax: N/A Email: mshirley@cityofdouglassks.com andrew@gwmks.com	Kansas Gas Service, a Div. of ONE Gas, Inc. Attn: Legal Department 7421 W. 129th Street Overland Park, KS 66213-2713 Phone: (913) 319-8619 Fax: N/A Email: kgsfranchises@onegas.com
Emergency Contact Information:
Emergency Designee: Mike Gowlovech	Natural Gas Emergency No.: 888-492-4950
Emergency Contact No.: 316-747-2109 Option 4	Local Contact Name: Alicia Butler
Emergency Email: dgabor@cityofdouglassks.com	Local Contact Email: Alicia.butler@onegas.com 316-296-1462 (mobile) 316-831-5622 (office)

(or to replacement addresses later designated in writing).

XVIII. AGREEMENT TO RENEGOTIATE

If the Kansas Corporation Commission takes any action regarding this Franchise, or any amendment to it, that prevents Company from recovering from its customers any costs or fees provided for in this Franchise, the parties shall renegotiate this Franchise to comply with or conform to the Commission’s ruling.

(09-09-2026)