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(A) The grantee shall not voluntarily or involuntarily, by operation of law or otherwise, sell, assign, transfer, lease, sublet or otherwise dispose of, the franchise and/or cable system or any of the rights or privileges granted by the franchise, without the prior written consent of the Council and then only upon the terms and conditions as may be prescribed by the Council in accordance with applicable laws, which consent shall not be unreasonably denied or delayed. Any attempt to sell, assign, transfer, lease, sublet or otherwise dispose of the franchise and/or cable system without the prior written consent of the Council shall be null and void and shall be grounds for termination of the franchise pursuant hereto and the applicable provisions of any franchise agreement.
(B) (1) Without limiting the nature of the events requiring the Council’s approval under this section, the following events shall be deemed to be a sale, assignment or other transfer of the franchise and/or cable system requiring compliance with this section:
(a) The sale, assignment or other transfer of all or a majority of the grantee’s assets or the assets comprising the cable system to any person so as to create a new controlling interest;
(b) The consolidation of the grantee or any of its parents with any other person so as to create a new controlling interest;
(c) The creation of a subsidiary corporation or other entity which owns or operates the cable system;
(d) The sale, assignment or other transfer of capital stock or partnership, membership or other equity interests in grantee or any of its parents by one or more of its existing shareholders, partners, members or other equity owners so as to create a new controlling interest in grantee;
(e) The issuance of additional capital stock or partnership, membership or other equity interest by grantee or any of its parents, so as to create a new controlling interest in grantee; and
(f) The entry by the grantee into an agreement with respect to the management or operation of the grantee, any of grantee’s parents and/or the system or the subsequent amendment thereof.
(2) The term CONTROLLING INTEREST, as used herein, is not limited to majority equity ownership of the grantee, but also includes actual working control over the grantee and/or the system in whatever manner exercised.
(C) In the case of any sale or transfer of ownership of any franchise and/or cable system the city shall have 120 days to act upon any request for approval of the sale or transfer that contains or is accompanied by information as is required in this chapter and applicable laws and such other reasonable information as the city, in its sole discretion, may request. If the city fails to render a final decision on the request within 120 days from receipt by the city of all required information, the request shall be deemed granted unless the requesting party and the city agree to an extension of time.
(D) The grantee shall notify grantor in writing of any foreclosure or any other judicial sale of all or a substantial part of the property and assets comprising the cable system of the grantee or upon the termination of any lease or interest covering all or a substantial part of the properly and assets. The notification shall be considered by grantor as notice that a change in control or ownership of the franchise has taken place and the provisions under this section governing the consent of grantor to the change in control or ownership shall apply.
(E) For the purpose of determining whether it shall consent to the change, transfer or acquisition of control, the grantor may inquire into the qualifications of the prospective transferee or controlling party, and the grantee shall assist the grantor in any inquiry. In seeking grantor’s consent to any change of ownership or control, the grantee shall have the responsibility of ensuring that the transferee completes an application which application shall include the information required under this chapter and applicable laws. An application, acceptable to the city, shall be submitted to grantor not less than 120 days prior to the date of transfer. The transferee shall be required to establish to the satisfaction of the city that it possesses the legal, technical and financial qualifications to operate and maintain the system and comply with all franchise requirements for the remainder of the term of the franchise. If, after considering the legal, financial and technical qualities of the transferee and determining that they are satisfactory, the grantor finds that the transfer is acceptable, the grantor shall permit the transfer and assignment of the rights and obligations of the franchise as may be in the public interest. The consent of the grantor to the transfer shall not be unreasonably denied.
(F) Any financial institution having a security interest in any and all of the property and assets of the grantee as security for any loan made to grantee or any of its affiliates for the construction and/or operation of the cable system must notify the grantor in accordance with this chapter and applicable laws that it or its designee satisfactory to the grantor seeks to take control of and operate the cable television system.
(G) In addition to the aforementioned requirements in this section, the city and grantee shall, at all times, comply with the requirements of M.S. § 238.083, as may be amended from time to time, regarding the sale or transfer of a franchise.
(Ord. 78, passed 10-13-1997)