(1) Grant–In the event that Grantor shall grant to the Grantee a nonexclusive, revocable franchise to construct, operate, maintain, and reconstruct, a Cable Communications System within the franchise area, said franchise shall constitute both a right and an obligation to provide the services of a Cable Communications System as required by the provisions of this Chapter and the Franchise Agreement. The Franchise Agreement shall include those provisions of the Grantee's "Application for Franchise" that are finally negotiated and accepted by the Grantor and Grantee.
Any franchise granted under the terms and conditions contained herein shall be consistent with general law and/or statutory requirements, which are incorporated by its reference as if fully set forth herein. In the event of conflict between the terms and conditions of the franchise and this Chapter, any mandatory provisions of the chapter in effect at the time of the adoption of a Franchise Agreement shall control; however, the Franchise Agreement shall control as to any optional provisions. (Optional provisions include provisions which state "to the extent (or it provided for) in the franchise agreement.") If this Chapter provides for an optional provisions by the franchise agreement is silent as to that provision, then the provision shall be deemed not applicable to that franchise agreement. Amendments to this Chapter shall not affect any Franchise Agreement entered into prior to the effective date of the amendment, unless both parties to the Franchise Agreement also amend the Agreement to incorporate the provisions of the amended Chapter. In the event of any conflict between the Agreement and Grantee's Franchise Application, the provisions of the Agreement shall govern.
Any franchise granted is hereby made subject to the general Chapter provisions now in effect or hereafter made effective. Nothing in the franchise shall be deemed to waive the requirements of the various codes and ordinances of the Grantor regarding permits, fees to be paid or manner of construction.
(2) Franchise Territory–The Grantor may grant a franchise for all or any defined portion of the City. The service area shall be the entire territory defined in the Franchise Agreement. The initial service area shall be that portion of the franchise territory scheduled to receive initial service, as stated in the Franchise Agreement.
(3) Use of Public Streets and Ways–For the purpose of operating and maintaining a Cable Communications System in the franchise area, and subject to the provisions of Section
19.04.070 (10) herein, the Grantee may erect, install, construct, repair, replace, reconstruct, and retain in, on, over, under, upon, across, and along the public streets and ways within the franchise territory such wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, pedestals, attachments, and other property and equipment as are necessary and appurtenant to the operation of the Cable Communications System. Prior to construction or alteration, however, the Grantee shall in each case file plans with the appropriate Grantor agencies and local utility companies, and receive written approval, if required, before proceeding.
(4) Duration–The term of any franchise and all rights, privileges, obligations and restrictions pertaining thereto shall be fifteen (15) years from the effective date of the franchise unless terminated sooner as hereinafter provided. The effective date of the franchise shall be the date of adoption of the resolution by the Grantor approving the franchise agreement.
(5) Franchise Nonexclusive–The franchise granted herein is nonexclusive. The Grantor specifically reserves the right to grant, at any time, such additional franchises for a Cable Communications System as it deems appropriate.
(6) Transfer of Ownership or Control
(a) Transfer of Franchise. Any franchise granted hereunder shall be a privilege to be held for the benefit of the public. Said franchise 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 consent of the Grantor, and then only under such conditions as the Grantor may establish. Such consent as required by the Grantor shall, however, not be unreasonably withheld.
(b) Ownership or Control. The Grantee shall promptly notify the Grantor of any proposed change in, or transfer of, or acquisition by any other party of, control of the Grantee, the word "control" as used herein is not limited to major stockholders but includes actual working control in whatever manner exercised. 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 ten percent (10%) of the voting shares or 10% ownership of the Grantee. Every channel, transfer, or acquisition of control of the Grantee shall make the franchise subject to cancellation, unless and until the Grantor shall have consented thereto, which consent will 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 Grantor's consent to any change in ownership or control, the Grantee shall have the responsibility:
(1) To show to the satisfaction for the Grantor whether the proposed purchaser, transferee, or assignee (the "proposed transferee"), which in the case of a corporation shall include all officers, directors, employees and all persons having a legal or equitable interest in five percent (5%) or more of its voting stock, or any of the proposed transferee's principals:
a. 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:
b. 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
c. Has pending any legal claims, lawsuit or administrative proceeding arising out of, or involving a cable system.
(2) To establish to the satisfaction of the Grantor, the financial solvency of the proposed transferee by submitting the same type of 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 reasonably request. Financial statements shall be audited, certified and qualified by an independent Certified Public Accountant. Said information shall be kept confidential by the Grantor.
(3) 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.
(c) The Grantor agrees that 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 it or its designee satisfactory to the Grantor will take control and operate the Cable Television 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 insure 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 and during said period of time it shall have the right to petition the Grantor to transfer franchise to another Grantee. If the Grantor finds that such transfer after considering the legal, financial, character, technical and other public interest qualities of the applicant are satisfactory, the Grantor will transfer and assign the rights and obligations of such franchise as in the public interest. The consent of the Grantor to such transfer shall not be unreasonably withheld.
(d) The consent or approval of the Grantor to any transfer of the Grantee shall not constitute a waiver or release of the rights of the Grantor in and to the streets and any transfer shall be its terms, be expressly subordinate to the terms and conditions of the franchise.
(e) In the absence of extraordinary circumstances, the Grantor will not approve any transfer assignment of the franchise, prior to substantial completion of construction of the proposed system.
(f) In no event shall a transfer of ownership or control be approved without the successor in interest becoming a signatory to the franchise agreement.
(7) Franchise Renewal. Nothing in any franchise agreement shall require renewal by the Grantor after the term of the franchise has expired, not shall renewal be presumed as a matter of vested interest.
(a) Term. The renewal term of any franchise shall not be greater than the initial term.
(b) Renewal Procedure.
(1) Not later than eighteen (18) or earlier than twenty-four (24) months prior to the expiration of any franchise, a Grantee may submit an application for renewal of such franchise, on forms approved by the Grantor, with a non-refundable application fee established by the Grantor in an amount not to exceed the reasonable cost of processing the application. The application shall set forth in detail the franchisee's legal, character, financial and other pertinent qualifications sufficient to make a determination to renew or terminate such franchise.
(2) The application when filed shall be available for public inspection at places designated by the Grantor. No later than ninety (90) days after filing, a public hearing shall be held on the application. A decision shall be made by the Grantor not later than ninety (90) days after such hearing based upon the application, the hearing, the Grantee's record of compliance with the franchise requirements, its record of satisfactory service, and the terms and conditions proposed for the franchise renewal period.
(3) Based on the above criteria, Grantor may decide to renew the franchise under appropriate terms and conditions, or not to renew the franchise.
(4) If Grantor's decision is not to renew the franchise, grantor may initiate public solicitations for applications for a new franchise. The original Grantee shall not be precluded from submitting such an application.
(5) In any renewal or public solicitation, the Grantor may require additional services, system upgrade or any other conditions it deems feasible and appropriate in the light of the state-of-the-art of the cable communications industry at that time.
(8) Police Powers. In accepting a franchise, the Grantee acknowledges that its rights hereunder are subject to the police power of the Grantor to adopt and enforce general ordinance necessary to the safety and welfare of the public; and it agrees to comply with all applicable general laws and ordinances enacted by the Grantor pursuant to such power.
Any conflict between the provisions of this Chapter and any other present or future lawful exercise of the grantor's police powers shall be resolved in favor of the latter, except that any such exercise that is not of general application in the jurisdiction or applies exclusively to any Grantee or Cable Communications Systems which contains provisions inconsistent with a franchise agreement shall prevail only if upon such exercise, the Grantor finds and there actually exists an emergency constituting a danger to health, safety, property or general welfare or such exercise is mandated by law. At the termination of the emergency, then the original franchise agreement shall control.
(9) Franchise Fee
(a) Annual Franchise Payment. A Grantee of a franchise hereunder shall pay to the Grantor an annual fee in an amount as designated in the franchise agreement, but in no event less than five percent (5%) of the annual gross revenues. Such payment shall be in addition to any other and commence as of the effective date of the franchise. Grantee shall provide quarterly statements showing gross quarterly revenues. The Grantor reserves the right to inspect the books of Grantee as provided in Section
19.04.090 hereunder.
(b) 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 obligation of the Grantee.
(c) 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 as additional compensation:
(1) An interest charge, computed from such due date, at the annual rate equal to the commercial prime interest rate in effect upon the due date.
(2) 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.
(3) But in no event shall the total of (1) and (2) above be in an amount in excess of that permitted by law.
(d) Due Date for Franchise Fee. Payment due the Grantor under this provision shall be computed quarterly, for the preceding quarter, as of March 30, June 30, September 30, and December 31. Each quarterly payment shall be due and payable no later than thirty (30) days after the dates listed in the previous sentence. Each payment shall be accompanied by a brief report showing the basis for the computation and such other relevant facts as may be required by the Grantor.
(e) Initial Payment. Following the issuance and acceptance of the franchise, the Grantee shall initiate franchise fee payments to the Grantor with the initial payment specified in the franchise agreement. This payment shall be credited against all payments due until said initial payment is completely recouped.
(10) Forfeiture or Revocation
(a) Grounds for Revocation. 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 and breach under this Chapter and the franchise grant.
(1) If the Grantee should 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 Grantee.
(2) 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.
(3) If any court of competent jurisdiction, or any federal or state regulatory body by rules, decisions or other action determines that any material provisions of the franchise documents, including this chapter, is invalid or unenforceable prior to the commencement of system construction.
(4) If the Grantee should willfully violate any material orders or material rulings of any regulatory body have jurisdiction over the Grantee relative to this franchise but revocation shall be stayed while such orders or rulings are being contested by the Grantee in a court of competent jurisdiction.
(5) If the Grantee ceases to provide services for any reason within the control of the Grantee over the Cable Communications System. The Grantee shall not be declared at fault or be subject to any sanction under any provisions of this ordinance in any case in which performance of any such provision is prevented for reasons beyond the Grantee's control if committed by a corporation or other business entity in which the Grantee holds a controlling interest, whether held directly or indirectly.
(6) If the Grantee attempts to evade any of the provisions of this chapter or the franchise agreement or practices any fraud or deceit upon the Grantor.
(7) If the Grantee's construction schedule is delayed for more than eighteen (18) months later than the schedule contained in the franchise agreement and Grantor finds that the delay was not excusable.
(8) If the Grantee becomes insolvent, unable or unwilling to pay its debts, or is adjudged a bankrupt.
(b) Procedure Prior to Revocation.
(1) The Grantor may make written demand that the Grantee do so comply with any such requirements, limitation, term, condition, rule or regulations or correct any action deemed cause of revocation. If the failure, refusal or neglect of the Grantee continues for a period of thirty (30) days following such written demand, the Grantor may place its request for termination of the franchise upon a regular Grantor meeting agenda. The Grantor shall cause notice to be served upon such Grantee, at least ten (10) days prior to the date of such meeting, a written notice of this intent to request such termination, and the time and place of the meeting, notice of which shall be published at least once, ten (10) days before such meeting in a newspaper of general circulation within the franchise area.
(2) The Grantor shall hear any persons interested therein, and shall determine, in its discretion, whether or not any failure, refusal or neglect by the Grantee was with just cause.
(3) If such failure, refusal or neglect by the Grantee was with just cause, the Grantor shall direct the Grantee to comply within such time and manner and upon such terms and conditions as are reasonable.
(4) If the Grantor shall determine such failure, refusal or neglect by the Grantee was without just cause, then the Grantor may, by resolution, declare that the franchise of such Grantee shall be terminated and security fund and bonds forfeited unless there be compliance by the Grantee within such period as the Grantor may fix.
(11) Procedures in the Event of Termination or Expiration
(a) Disposition of Facilities In the event a franchise expires, is revoked, or otherwise terminated, the Grantor may order the removal of the 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 network until subsequent or modified cable system becomes operational.
(b) 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 equipment and appliances, without affecting the electrical or telephone cable wires, or attachments. The Grantor shall inspect and approve the condition of the public ways and public places; and cables, wires, attachments and poles after removal. The liability, indemnity and insurance, and the security fund and bonds provided therein shall continue in full force and during the period of removal and until full compliance by the Grantee with the terms and conditions of this Section.
(c) Restoration by Grantor, Reimbursement of Costs. In the event of a failure by the Grantee to complete any work required by Subsection
(a) above and/or Subsection
(b) above, or any other work required by Grantor by law or ordinance within the time as may be established 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 the Grantee. The Grantor shall be permitted to seek legal and equitable relief to enforce the provisions of this section.
(d) Extended Operation. Upon either the expiration or revocation of the franchise, the Grantor may require the Grantee to continue to operate the Cable Communications 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 subscriber service and any and all of the services that may be provided at that time. The Grantor shall be permitted to seek legal and equitable relief to enforce the provisions of this Section.
(e) 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 the franchise or any provision of law. (Ord 498, Sec. 4, 1983)
(12) Receivership and Foreclosure
(a) Any franchise granted herein shall, at the option of the Grantor, cease and terminate one hundred twenty (120) days after the appointment of a receiver or receivers or trustee or trustees to take over and conduct the business of the Grantee whether in a receivership, reorganization, bankruptcy or other action or proceeding unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days, or unless:
(1) Such receivers or trustees shall have, within one hundred twenty (120) days after their election or appointment, fully complied with all the terms and provisions of this ordinance and the franchise granted pursuant hereto, and the receivers or trustees within said one hundred twenty (120) days shall have remedied all defaults under the franchise; and
(2) Such receivers or trustees shall, within said one hundred twenty (120) days, execute an agreement duly approved by the Court having jurisdiction in the premises, whereby such receivers or trustees assume to be bound by each and every term, provision and limitation of the franchise herein granted.
(b) In the case of a foreclosure or other judicial sale of the plant, property and equipment of the Grantee, or any part thereof, including or excluding this franchise, the Grantor may serve notice of termination upon the Grantee and the successful bidder at such sale, in which event the successful bidder at such sale, in which event the franchise herein granted and all rights and privileges of the Grantee hereunder shall cease and terminate thirty (30) days after service of such notice, unless:
(1) The Grantor shall have approved the transfer of this franchise, as and in the manner in this chapter provided, and
(2) Such successful bidder shall have covenanted and agreed with the Grantor to assume and be bound by all the terms and conditions of this franchise.
(13) Franchise Required. No Cable Communications System shall be allowed to occupy or use the streets in the franchise territory or be allowed to operate without a franchise in accordance with the provisions of this chapter.
(14) Establishment of Franchise Requirements. The 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 state-of-the-art in the cable television industry. Such requirements shall not be retroactive to franchises then in effect.
(Ord. 498, Sec. 4, 1983; Ord. 498, Sec. 4 1983; Ord. 428, Sec. 4, 1983)