Sec. 5.01.Compliance with Applicable Laws. Notwithstanding any other provision of this franchise to the contrary, the Grantee shall at all times comply with all laws, rules, and regulations of the City, state and federal governments and any administrative agencies thereof. If any such state or federal law, rule, or regulation shall require or permit the Grantee to perform in conflict with this franchise or prohibit the performance of any service required by provisions of this franchise, then immediately following knowledge thereof, the Grantee shall notify the City in writing of the point of conflict believed to exist between such state or federal law, rule, or regulation and this franchise. If the City Council determines that a material provision of this franchise does in fact conflict with such state or federal law, rule, or regulation, the parties shall enter into good faith negotiations to modify any provision hereof to such reasonable extent as may be necessary to carry out the full intent and purpose of this franchise.

Sec. 5.02.Subject to Police Power of the City. The construction, maintenance, and operation of services provided by Grantee and all property of Grantee subject to the provisions of this franchise shall be subject to all lawful police powers, rules, and regulations of the City, including, but not limited to Ordinance No. 2000-523, adopted the 19th day of December, 2000, as it now exists or as it may hereafter be amended. The City shall have the power at any time to order and require Grantee to remove or abate any part of its gas system or structures that are dangerous to life or property. In the event Grantee, after written notice, fails or refuses to act, the City shall have the power to remove or abate the same at the expense of Grantee, all without compensation or liability for damages to Grantee. Notwithstanding the foregoing, City acknowledges that it may not and will not remove pipes or mains or perform any "covered task" on the gas system unless it is qualified to do so under U.S. Department of Transportation regulations at 49 CFR, Part 192, Subpart N.

Sec. 5.03.Modifications by Texas Railroad Commission: Jurisdiction of Texas Railroad Commission. It is specifically agreed by the City and Grantee that any modification of the provisions of this franchise resulting from amendment of the rules and regulations of the Texas Railroad Commission or other applicable state or federal governmental agency shall be automatically incorporated into this franchise unless:

A.

Such modification provides for leniency in the provisions included in this franchise and such leniency is not required by law; or

B.

The City Council specifically rejects such incorporation of said modifications within one year of the adoption of such modification and such rejection is not in conflict with any City, state or federal laws, rules, or regulations.