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, or other means, without the prior written consent of the City, and then only under such reasonable conditions as the City may establish, subject to Section 537 of the Cable Act and applicable FCC regulations. Such consent, as required by the City, shall be given or denied no later than 120 days following any request, and shall not be unreasonably withheld. If the City fails to render a final decision on the request within 120 days of receiving a transfer request, such request shall be deemed approved unless the requesting party and the City agree to an extension of time. Prior consent shall 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 City 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 consisting of 20 percent 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 City shall have consented in writing thereto, which consent shall be given or denied no later than 120 days following any request, and shall not be unreasonably withheld. If the City fails to render a final decision on the request within 120 days of receiving a transfer request, such request shall be deemed approved unless the requesting party and the City agree to an extension of time. For the purpose of determining whether it shall consent to such change, transfer, or acquisition of control, the City may inquire into the qualifications of the prospective controlling party, and the grantee shall assist the City 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 City 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 of five percent or more of the voting stock:
(1) Within ten years before the transfer request, has 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) Previous or pending legal claim, lawsuit, or administrative proceeding arising out of or involving a cable system or operation of cable system.
B. To establish, to the satisfaction of the City, 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 City may request, where the same shall be audited, certified, and qualified by a certified public accountant.
C. To establish to the satisfaction of the City 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 City that the financial institution, or its designee, intend to 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 year unless extended by the City in its discretion, but during said period of time it shall have the right to petition the City 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 City finds that such transfer, after considering the legal, financial, character, technical and other public interest qualities of the proposed transferee, is satisfactory, the City shall transfer and assign the right and obligations of such franchise as in the public interest. The consent of the City to such transfer shall be given or denied no less than 120 days after any request, and shall not be unreasonably withheld. In cases of either a transfer of the franchise or a proposed change in ownership or control of the grantee involving a wholly owned subsidiary of grantee, upon written request of the grantee, the City may waive or modify the requirements of this section. The City shall provide grantee notice of its decision on such request as soon as practicable after receipt. Notwithstanding grantee’s request under this section, the 120-day period for rendering a decision on a transfer of the franchise or a change in ownership or control shall commence upon the City’s receipt of grantee’s notice of proposed transfer or change in ownership or control.
4. The consent or approval of the City to any transfer by the grantee shall not constitute a waiver or release of the rights of the City 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 City 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 City may approve the transfer, deny the transfer with cause, or conditionally approve the transfer, provided that the City shall not unreasonably refuse to approve the transfer or condition the transfer upon unreasonable conditions. The conditions the City may attach to the transfer approval may include, but are not limited to: charges that are incidental to the awarding of the franchise, as allowed under Federal law; remedy of any existing or historical violations of City ordinances or the franchise agreement, provided that for violations occurring before the date of the transfer request, City has given notice of such violations to the grantee before City has received the transfer request; payment of all fees and penalties owed by the grantee at the time of transfer approval; and a guarantee by the proposed transferee to abide by any and all ordinances, agreements, and conditions placed upon the franchise and system by the City and existing grantee, unless mutually removed by the City 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 115.07, including the filing of all necessary bonds, funds, proofs of insurance, and certifications.