113.04 POLICE POWER.

Nothing in this chapter or in any franchise agreement hereunder shall be construed as an abrogation by the City of any of its police powers.

113.05 GRANT OF FRANCHISE.

1.    Application. All applicants for a franchise under this chapter shall prepare and file a written application with the Grantor in such form as the Grantor shall designate.

2.    Review of Application. Upon receipt of an application under this chapter, the Grantor shall review the same and make the application available for public inspection at such places as the Grantor shall designate. A decision shall be made on the application by the Grantor after evaluation thereof. The Grantor may grant one (1) or more franchises, or may decline to grant any franchise.

3.    Franchise Required. Subject to Federal and State law, no cable system shall be allowed to occupy or use the streets in the franchise area or be allowed to operate without a franchise granted in accordance with the provisions of this chapter.

4.    Franchise Nonexclusive. Any franchise granted under this chapter shall be revocable and nonexclusive.

5.    Franchise Requirements. Grantor may establish appropriate requirements for new franchises or franchise renewals, and may modify these requirements from time to time to reflect changing conditions and technology in the cable industry.

6.    Grant. In the event the Grantor shall grant to a Grantee or renew a nonexclusive, revocable franchise to construct, operate, maintain and reconstruct a cable system within the franchise area, said franchise shall constitute both a right and an obligation to provide the service of a cable system as required by this chapter and the terms of the franchise agreement.

7.    Conflicts with Federal or State Laws. Any franchise granted under this chapter shall be consistent with Federal laws and regulations and State general laws and regulations. In the event of a conflict between the terms and conditions of the franchise agreement and the terms and conditions of Federal or State law under which Grantor can grant a franchise, except where the application of such Federal or State law would impose inconsistent or additional material obligations or duties upon Grantee, such general law or requirements shall control.

8.    Ordinance Revisions. Any franchise granted under this chapter is hereby made subject to any revisions of this chapter or the general ordinances of the City, provided that such revisions do not materially alter or impair the obligations of Grantee set forth in any franchise agreement.

9.    Term. The term of any new or renewal franchise granted under this chapter shall be established in the franchise agreement, provided that in no event shall any franchise granted under this chapter exceed the term of fifteen (15) years.

10.    Other Licenses or Permits. A franchise granted under this chapter shall not take the place of any other license or permit legally required of a Grantee.

113.06 FRANCHISE ACCEPTANCE.

1.    To accept a franchise granted under this chapter, a Grantee must file any required bonds, funds and proof of insurance, as well as written notice of acceptance with the Clerk within 45 days of the effective date of the franchise agreement. Such written notice shall include a certification that the Grantee:

A.    Will comply with this chapter, any franchise agreements made pursuant to this chapter, and all applicable City, County, State and Federal regulations in regard to the construction, operation and maintenance of a cable system;

B.    Accepts the franchise relying on its own investigation and understanding of the power and authority of the Grantor to grant the franchise and the terms and conditions thereof;

C.    Acknowledges that it has not been induced to enter into the franchise by any understanding or promise or by other statement, whether written or verbal, by or on behalf of the Grantor or by any other third person concerning any term or condition of the franchise or chapter not expressed herein;

D.    Shall have no recourse whatsoever against the Grantor for any loss, cost, expense or damage arising out of any provision or requirement of a franchise or the enforcement thereof, or for the failure of the Grantor to have authority to grant any or all parts of the franchise;

E.    Agrees that, in the event of any conflict between the chapter and the franchise agreement, the terms of the franchise agreement shall prevail.

F.    Will not at any time claim in any proceeding involving the Grantor that any condition or term of the franchise or chapter is unreasonable, arbitrary or void, or that the Grantor had no power or authority to make any such term or condition, but shall accept the validity of the terms and conditions of the franchise and this chapter in their entirety, except as provided by local, State, Federal law or FCC rules and regulations.

2.    A Grantee of a franchise granted or transferred under this chapter may, at the time of acceptance of the franchise, provide an initial payment to the Grantor in the amount of the Grantor’s cost for printing and publication cost incurred in granting the franchise.

113.07 TRANSFER OF OWNERSHIP OR CONTROL.

1.    Transfer of Franchise. Any franchise granted under this chapter shall be a privilege to be held for the benefit of the public. Any franchise so granted cannot, in any event, be sold, transferred, leased, assigned or disposed of, including, but not limited to, by forced or voluntary sale, merger, consolidation, receivership or other means, without the prior written consent of the Grantor, and then only under such reasonable conditions as the Grantor may establish. Such consent as required by the Grantor shall be given or denied no later than one hundred twenty (120) days following any request, and shall not be unreasonably withheld. Prior consent shall not be required when transferring the franchise between wholly owned subsidiaries of the same entity.

2.    Ownership or Control. The Grantee shall promptly notify in writing the Grantor of any proposed change in, or transfer of, or acquisition by any other party of, control of the Grantee. A rebuttable presumption that a transfer of control has occurred shall arise upon the acquisition or transfer by any person or group of persons of fifty percent (50%) or more of the beneficial ownership interest of the Grantee. Every change, transfer, or acquisition of control of the Grantee shall make the franchise subject to cancellation unless and until the Grantor shall have consented in writing thereto, which consent shall be given or denied no later than one hundred and twenty (120) days following any request, and shall not be unreasonably withheld. For the purpose of determining whether it shall consent to such change, transfer or acquisition of control, the Grantor may inquire into the qualifications of the prospective controlling party, and the Grantee shall assist the Grantor in any such inquiry. In seeking the Grantee’s consent to any change in ownership or control, the Grantee shall have the responsibility:

A.    To show to the satisfaction of the Grantor whether the proposed purchaser, transferee, or assignee (the “proposed transferee”), which in the case of a corporation shall include all directors and all persons having a legal or equitable interest in fifty percent (50%) or more of the voting stock:

(1)   Has ever been convicted or held liable for acts involving moral turpitude including, but not limited to, any violation of Federal, State or local law or regulations, or is presently under an indictment, investigation or complaint charging such acts;

(2)   Has ever had a judgment in an action for fraud, deceit or misrepresentation entered against it, her, him, or them by any court of competent jurisdiction; or

(3)   Has pending any legal claim, lawsuit or administrative proceeding arising out of or involving a cable system.

B.    To establish, to the satisfaction of the Grantor, the financial solvency of the proposed transferee by submitting all current financial data for the proposed transferee which the Grantee was required to submit in its franchise application, and such other data as the Grantor may request, where the same shall be audited, certified and qualified by a certified public accountant.

C.    To establish to the satisfaction of the Grantor that the financial and technical capability of the proposed transferee is such as shall enable it to maintain and operate the cable system for the remaining term of the franchise under the existing franchise terms.

3.    Any financial institution having a pledge of the franchise or its assets for the advancement of money for the construction and/or operation of the franchise shall have the right to notify the Grantor that the financial institution, or its designee, as approved in writing by the Grantor, shall take control and operate the cable system in the event of a Grantee default in its financial obligations. Further, said financial institution shall also submit a plan for such operation that will ensure continued service and compliance with all franchise requirements during the term the financial institution exercises control over the system. The financial institution shall not exercise control over the system for a period exceeding one (1) year unless extended by the Grantor in its discretion, but during said period of time it shall have the right to petition the Grantor to transfer the franchise to another Grantee. Except insofar as the enforceability of this subsection may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally, and further subject to applicable Federal, State or local law, if the Grantor finds that such transfer after considering the legal, financial, character, technical and other public interest qualities of the proposed transferee is satisfactory, the Grantor shall transfer and assign the right and obligations of such franchise as in the public interest. The consent of the Grantor to such transfer shall be given or denied no less than one hundred and twenty (120) days after any request, and shall not be unreasonably withheld.

4.    The consent or approval of the Grantor to any transfer by the Grantee shall not constitute a waiver or release of the rights of the Grantor in and to the streets, and any transfer shall by its terms, be expressly subject to the terms and conditions of any franchise.

5.    In the absence of extraordinary circumstances, the Grantor shall not approve any transfer or assignment of the franchise prior to completion of initial construction of the cable system.

6.    In no event shall a transfer of ownership or control be approved without the successor in interest becoming a signatory of the franchise agreement.

7.    The Grantor may approve the transfer, deny the transfer with cause, or conditionally approve the transfer, provided that the Grantor shall not unreasonably refuse to approve the transfer or condition the transfer upon unreasonable conditions. The conditions the Grantor may attach to the transfer approval may include, but are not limited to: reimbursement for reasonable and necessary expenses incurred in evaluating the transfer request; remedy of any existing or historical violations of City ordinances or the franchise agreement; payment of all fees and penalties owed by the Grantee at the time of transfer approval; and a guarantee by the prospective transferee to abide by any and all ordinances, agreements and conditions placed upon the franchise and system by the Grantor and existing Grantee, unless mutually removed by the Grantor and Grantee.

8.    When the Grantee approves a transfer under this section, the new Grantee shall indicate acceptance of the franchise as specified in Section 113.06, including the filing of all necessary bonds, funds, proofs of insurance and certifications.

113.08 FRANCHISE RENEWAL.

1.    The Grantor may decide to renew a franchise granted under this chapter if the Grantee files a written request for such a renewal. At the time of such request, the Grantor may update this chapter and reevaluate the needs of the community for cable service and the performance of the Grantee.

2.    To the extent applicable, of the Cable Act shall govern the procedures and standards for renewal of any franchise awarded pursuant to this chapter.

3.    To the extent that the Cable Act is not applicable, the Grantor in its sole discretion and judgment shall have the right to grant, deny or conditionally grant renewal of a franchise, provided that the Grantor shall not unreasonably refuse to renew the franchise or unreasonably condition the renewal. The conditions that Grantor may place on its approval shall include, but are not limited to: reimbursement for reasonable expenses incurred in evaluating the request for renewal, updating the chapter and surveying community cable needs, remedy of historical or existing violations of the franchise or chapter; payment of all fees and penalties owed by the Grantee at the time of the renewal; acceptance of any updated chapter; and acceptance of any updated franchise agreement.

4.    Unless otherwise agreed upon, any amended cable ordinance or provision thereunder adopted before the franchise renewal shall take effect at the franchise renewal.

5.    When the Grantor approves a franchise renewal, the Grantee shall accept the renewed franchise under the procedures set out in Section 113.06.

113.09 FRANCHISE FEE.

1.    Quarterly Franchise Payment. A Grantee shall pay to the Grantor a fee in an amount as designated in the franchise agreement, which amount shall not be less than five percent (5%) of Grantee’s gross subscriber receipts or such other maximum amount as allowed by applicable law. Such payment shall commence as of the effective date of the franchise or any renewal date. The Grantor shall be furnished, on an annual basis, a statement within one hundred twenty (120) days of the close of the calendar year, either audited and certified by an independent certified public accountant or certified by a financial officer of the Grantee, reflecting the total amount of the revenue and all payments, deductions and computations for the period covered by the payment. Upon ten (10) days’ prior written notice, Grantor shall have the right to conduct an independent audit of Grantee’s records, in accordance with generally accepted accounting procedures, and if such audit indicates a franchise fee underpayment of five percent (5%) or more, the Grantee shall assume all reasonable costs of such an audit.

2.    Acceptance by Grantor. No acceptance of any payment by the Grantor shall be construed as a release or as an accord and satisfaction of any claim the Grantor may have for further or additional sums payable as a franchise fee under this chapter or for the performance of any other obligations of the Grantee.

3.    Failure To Make Required Payment. In the event that any franchise payment or recomputed amount is not made on or before the dates specified herein, Grantee shall pay an additional compensation:

A.    An interest charge, computed from such due date, at an annual rate equal to the average rate of return on invested funds of the Grantor during the period for which payment was due.

B.    If the payment is late by forty-five (45) days or more, a sum of money equal to five percent (5%) of the amount due in order to defray those additional expenses and costs incurred by the Grantor by reason of delinquent payment.

4.    Payment Schedule. The franchise fee shall be paid on a quarterly basis according to the following schedule: Revenues for January through March shall be reflected in a May 15 th payment; revenues for April through June shall be reflected in an August 15 th payment; revenues for July through September in an October 15 th payment; and revenues for October through December in a February 15 th payment.

5.    Pass Through. Any Grantee “pass through” or itemization of franchise fee costs on subscribers’ bills shall be in accordance with Federal law.

113.10 REVOCATION.

1.    Grounds For Revocation. If the Grantee has been given due notice and a reasonable opportunity to cure, the Grantor reserves the right to revoke any franchise granted hereunder and rescind all rights and privileges associated with the franchise in the following circumstances, each of which shall represent a default under this chapter and a material breach of the franchise.

A.    If the Grantee shall default in the performance of any of its material obligations under this chapter or under such documents, agreements and other terms and provisions entered into by and between the Grantor and the Grantee, subject to the provisions on cure.

B.    If the Grantee should fail to provide or maintain in full force and effect, the liability and indemnification coverages or the security fund or bonds as required herein.

C.    If any court of competent jurisdiction, or any Federal or State regulatory body by rules, decisions or other action determines that any material provision of the franchise documents, including this chapter, the franchise agreement and Grantee’s proposal is invalid or unenforceable prior to the commencement of initial system construction.

D.    If the Grantee ceases to provide service for a period exceeding thirty (30) days for any reason within the control of the Grantee over the cable system, or abandons the management and/or operation of the system.

E.    If the Grantee willfully violates any of the material provisions of this chapter or the franchise agreement or attempts to practice any fraud or deceit upon the Grantor.

F.    If the Grantee becomes insolvent, or upon listing of an order for relief in favor of the Grantee in a bankruptcy proceeding.

G.    If the Grantee transfers a controlling interest of the franchise without the prior approval or consent of the Grantor as required in Section 113.07.

2.   Procedure Prior To Revocation.

A.    The Grantor may make a written demand that the Grantee comply with any such requirement, limitation, term, condition, rule or regulation or correct any action deemed cause for revocation. Such written demand shall detail the exact nature of the alleged noncompliance. In the event the stated violation is not reasonably curable within thirty (30) days, the franchise shall not be terminated or revoked, or damages assessed, if the Grantee provides within the said thirty (30) days a plan, satisfactory to the Grantor, to remedy the violation. If the failure, refusal or neglect of the Grantee continues for a period exceeding thirty (30) days following receipt of such written demand by the Grantee, the Grantor may terminate the franchise agreement in accordance with the procedures set forth in Section 113.11.

B.    The Grantor shall hear any persons interested therein, and shall determine, within ninety (90) days, based upon the preponderance of the evidence, whether the Grantee has committed a material breach of this chapter or the franchise agreement, and if so, whether such breach was willful.

C.    If the Grantor determines that the Grantee has willfully committed a material breach, then the Grantor may, by resolution, declare that the franchise of such Grantee shall be terminated and security fund and bonds forfeited, or the Grantor may, at its option and if the material breach is capable of being cured by the Grantee, direct the Grantee to take appropriate remedial action within such time and manner and upon such terms and conditions as the Grantor shall determine are reasonable under the circumstances.

113.11 PROCEDURES ON TERMINATION.

1.    Disposition of Facilities. Subject to Federal, State and local laws, in the event a franchise expires, is revoked, or otherwise terminated, the Grantor may order the removal of the above-ground system facilities from the franchise area within a reasonable period of time as determined by the Grantor or require the original Grantee to maintain and operate its cable system for a period not to exceed twenty-four (24) months as indicated in subsection 4.

2.    Restoration of Property. In removing its plant, structures, and equipment, the Grantee shall refill, at its own expense, any excavation that shall be made by it and shall leave all public ways and places in as good condition as that prevailing prior to the Grantee’s removal of its plant, structures and equipment without affecting the electrical or telephone cable wires, or attachments. The Grantee’s insurance, indemnity obligations, performance bond(s) and security fund(s) required by this chapter and by the franchise agreement shall continue in full force and effect during the period of removal and until full compliance by the Grantee with the terms and conditions of this chapter.

3.    Restoration by Grantor; Reimbursement of Costs. In the event of a failure by the Grantee to complete any work required by subsection 1 and/or subsection 2 above, or any other work required by Grantor by law or ordinance, within thirty (30) days after receipt of written notice, and to the satisfaction of the Grantor, the Grantor may cause such work to be done and the Grantee shall reimburse the Grantor the cost thereof within thirty (30) days after receipt of an itemized list of such costs or the Grantor may recover such costs through the security fund or bonds provided by Grantee. The Grantor shall be permitted to seek legal and equitable relief to enforce the provisions of this chapter.

4.    Extended Operation. Subject to Federal, State and local law, upon either the expiration or revocation of a franchise, the Grantor may require the Grantee to continue to operate the cable system for a defined period of time not to exceed twenty-four (24) months from the date of such expiration or revocation. The Grantee shall, as trustee for its successor in interest, continue to operate the cable communications system under the terms and conditions of this chapter and the franchise agreement and to provide the regular cable service and any of the other services that may be provided at that time.

5.    Grantor’s Right Not Affected. The termination and forfeiture of any franchise shall in no way affect any of the rights of the Grantor under any provision of law.