Exhibit 10.13

CABLE TELEVISION FRANCHISE ORDINANCE

FOR THE

CITY OF MONTGOMERY, ALABAMA

AND

KNOLOGY OF MONTGOMERY, INC.

D/B/A KNOLOGY, INC.

November 5, 2007

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TABLE OF CONTENTS

 

SECTION 1.   SHORT TITLE AND DEFINITIONS    1   1.    Short Title    1   2.   
Definitions    1 SECTION 2.   GRANT OF AUTHORITY AND GENERAL PROVISIONS    5  
1.    Grant of Franchise    5   2.    Grant of Nonexclusive Authority    5   3,
   Lease or Assignment Prohibited    6   4.    Franchise Term    6   5.   
Previous Franchises    6   6.    Compliance with Applicable Laws, Resolutions
and Ordinances    6   7.    Rules of Grantee    7   8.    Territorial Area
Involved    7   9.    Written Notice    7   10.    Ownership of Grantee    7
SECTION 3.   CONSTRUCTION STANDARDS    8   1.    Registration, Permits
Construction Codes and Cooperation    8   2.    Ongoing Construction    8   3.
   Use of existing poles or conduits    9   4.    Minimum Interference    9   5.
   Disturbance or damage    10   6.    Temporary Relocation    10   7.   
Emergency    10   8.    Tree Trimming    11   9.    Protection of facilities   
11   10.    Installation records    11   11.    Locating facilities    11   12.
   City’s rights    11   13.    Relocation delays    12   14.    Interference
with City Facilities    12   15.    Interference with Utility Facilities    12  
16.    Collocation    12   17.    Safety Requirements    12 SECTION 4.   DESIGN
PROVISION    13   1.    System Upgrade: Minimum Channel Capacity    13   2.   
Construction Timetable    13   3.    Interruption of Service    14   4.   
Emergency Alert Capability    14   5.    Technical Standards    14   6.   
Special Testing    14   7.    FCC Reports    15   8.    Interconnection    15  
9.    Annexation    15

 

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  10.    Line Extension    15   11.    Lockout Device    16 SECTION 5.   SERVICE
PROVISIONS    16   1.    Regulation of Service Rates    16   2.    Non-Standard
Installations    16   3    Sales Procedures    16   4.    Consumer Protection
and Service Standards    16   5.    Subscriber Contracts    20   6.    Refund
Policy    20   7.    Late Fees    20   8.    Local Office Policy    20 SECTION
6.   ACCESS CHANNEL(S) PROVISIONS    20   1.    Grantee Support for PEG Access
   20   2.    Compliance with Federal Law    21 SECTION 7.   OPERATION AND
ADMINISTRATION PROVISIONS    21   1.    Administration of Franchise    21   2.
   Delegated-Authority    21   3.    Franchise Fee    21   4.    Discounted
Rates    21   5.    Not Franchise Fees    22   6.    Access to Records    22  
7.    Reports and Maps to be Filed with City    23   8.    Periodic Evaluation
   23 SECTION 8.   GENERAL FINANCIAL AND INSURANCE PROVISIONS    24   1.   
Letter of Credit    24   2.    Liquidated Damages    25   3.    Liability
Insurance    26   4.    Indemnification    27   5.    Grantee’s Insurance    28
SECTION 9.   SALE, ABANDONMENT, TRANSFER, AND REVOCATION OF FRANCHISE    29   1.
   City’s Right to Revoke    29   2.    Procedures for Revocation    29   3   
Abandonment of Service    30   4.    Removal After Abandonment. Termination or
Forfeiture    30   5.    Sale or Transfer of Franchise    30 SECTION 10.  
PROTECTION OF INDIVIDUAL RIGHTS    32   1.    Discriminatory Practices
Prohibited    32   2.    Subscriber Privacy    32 SECTION 11.   UNAUTHORIZED
CONNECTIONS AND MODIFICATIONS    33   1.    Unauthorized Connections or
Modifications Prohibited    33

 

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  2.    Removal or Destruction Prohibited    33   3.    Penalty    33
SECTION 12.   MISCELLANEOUS PROVISIONS    33   1.    Franchise Renewal    33  
2.    Work Performed by Others    33   3.    Amendment of Franchise Ordinance   
33   4.    Compliance with Federal, State and Local Laws    33   5.   
Nonenforcement by City    34   6.    Rights Cumulative    34   7.    Grantee
Acknowledgment of Validity of Franchise    34   8.    Force Majeure    34
SECTION 13.   PUBLICATION EFFECTIVE DATE; ACCEPTANCE AND EXHIBITS    35   1.   
Publication, Effective Date    35   2.    Acceptance    35 EXHIBIT A.  
OWNERSHIP    1 EXHIBIT B.   COMMITMENT TO PEG ACCESS FACILITIES AND EQUIPMENT   
1 EXHIBIT C.   SERVICE TO PUBLIC AND PRIVATE BUILDINGS    EXHIBIT D.  
ADDITIONAL TWO-WAY CONNECTIONS TO PUBLIC INSTITUTIONS    1 EXHIBIT E.  
DESCRIPTION OF SYSTEM    1 EXHIBIT F.   FRANCHISE FEE PAYMENT WORKSHEET    1

 

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ORDINANCE NO. 78-2007

AN ORDINANCE GRANTING A FRANCHISE TO KNOLOGY OF MONTGOMERY, INC. D/B/A KNOLOGY,
INC., TO CONSTRUCT, OPERATE, AND MAINTAIN A CABLE SYSTEM IN THE CITY OF
MONTGOMERY, ALABAMA SETTING FORTH CONDITIONS ACCOMPANYING THE GRANT OF THE
FRANCHISE; PROVIDING FOR REGULATION AND USE OF THE SYSTEM AND THE PUBLIC
RIGHTS-OF-WAY AND PRESCRIBING PENALTIES FOR THE VIOLATION OF THE PROVISIONS
HEREIN;

The City Council of the City of Montgomery Alabama ordains:

STATEMENT OF INTENT AND PURPOSE

City intends, by the adoption of this Franchise, to bring about the further
development of a Cable System, and the continued operation of it. Such
development can contribute significantly to the communication needs and desires
of the residents and citizens of City and the public generally. Further, City
may achieve better utilization and improvement of public services and enhanced
economic development with the development and operation of a Cable System.

Adoption of this Franchise is, in the judgment of the City Council, in the best
interests of City and its residents.

FINDINGS

In the review of the request for renewal by Grantee and negotiations related
thereto, and as a result of a public hearing, the City Council makes the
following findings:

 

1. Grantee’s technical ability, financial condition, legal qualifications, and
character were considered and approved in a full public proceeding after due
notice and a reasonable opportunity to be heard;

 

2. Grantee’s plans for constructing, upgrading, and operating the Cable System
were considered and found adequate and feasible in a full public proceeding
after due notice and a reasonable opportunity to be heard;

 

3. The Franchise granted to Grantee by City complies with the existing
applicable state statutes, federal laws and regulations; and

 

4. The Franchise granted to Grantee is nonexclusive.

SECTION 1.

SHORT TITLE AND DEFINITIONS

 

1. Short Title. This Franchise Ordinance shall be known and cited as the Cable
Television Franchise Ordinance.

 

2.

Definitions. For the purposes of this Franchise, the following terms, phrases,
words, and their derivations shall have the meaning given herein. When not
inconsistent with the

 

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context, words in the singular number include the plural number, and words in
the plural number include the singular number. The word “shall” is always
mandatory and not merely directory. The word “may” is directory and
discretionary and not mandatory. Words not defined shall be given their common
and ordinary meaning.

 

  a. “Applicable Laws” means any law, statute, charter, ordinance, rule,
regulation, code, license, certificate, franchise, permit, writ, ruling, award,
executive order, directive, requirement, injunction (whether temporary,
preliminary or permanent), judgment, decree or other order issued, executed,
entered or deemed applicable by any governmental authority.

 

  b. “Basic Cable Service” means any Service tier which includes the lawful
retransmission of local television broadcast signals and any public,
educational, and governmental access programming required by the Franchise to be
carried on the basic tier. Basic Cable Service as defined herein shall be the
definition set forth in 47 U.S.C. § 543(b)(7).

 

  c. “Cable Service” or “Service” means (A) the one-way transmission to
Subscribers of (i) Video Programming or (ii) Other Programming Service, and
(B) Subscriber interaction, if any, which is required for the selection or use
of such Video Programming or Other Programming Service. Cable Service as defined
herein shall be the definition set forth in 47 U.S.C. § 522(6).

 

  d. “Cable System” or “System” means a facility, consisting of a set of closed
transmission paths and associated signal generation, reception, and control
equipment that is designed to provide Cable Service which includes Video
Programming and which is provided to multiple Subscribers within a community,
but such term does not include:

 

  i. a facility that serves only to retransmit the television signals of one
(1) or more television broadcast stations;

 

  ii. a facility that serves Subscribers without using any public Right-of-Way;

 

  iii. a facility of common carrier which is subject, in whole or in part, to
the provisions of 47 U.S.C. § 201 et seq., except that such facility shall be
considered a Cable System (other than for purposes of 47 U.S.C. § 541(c)) to the
extent such facility is used in the transmission of Video Programming directly
to Subscribers, unless the extent of such use is solely to provide interactive
on-demand services;

 

  iv. an open video system that complies with 47 U.S.C. § 573; or

 

  v. any facilities of any electric utility used solely for operating its
electric utility systems.

Cable System as defined herein shall be the definition set forth in 47 U.S.C. §
522(7).

 

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  e. “Channel” or “Cable Channel” means a portion of the electromagnetic
frequency spectrum which is used in a Cable System and which is capable of
delivering a television Channel as defined by the FCC. Cable Channel as defined
herein shall be the definition set forth in 47 U.S.C. § 522(4).

 

  f. “City” means City of Montgomery, a municipal corporation, in the State of
Alabama, acting by and through its City Council, or its lawfully appointed
designee.

 

  g. “City Council” means the governing body of the City of Montgomery, Alabama.

 

  h. “Converter” means an electronic device which converts signals to a
frequency acceptable to a television receiver of a Subscriber.

 

  i. “Drop” means the cable that connects the ground block on the Subscriber’s
residence to the nearest feeder cable of the System.

 

  j. “FCC” means the Federal Communications Commission and any legally
appointed, designated or elected agent or successor.

 

  k. “Franchise” or “Cable Franchise” means this franchise ordinance and the
regulatory and contractual relationship established hereby.

 

  l. “Franchise Fee” includes any tax, fee, or assessment of any kind imposed by
the City or other governmental entity on Grantee or Subscriber, or both, solely
because of their status as such. It does not include any tax, fee, or assessment
of general applicability (including any such tax, fee, or assessment imposed on
both utilities and cable operators or their services but not including a tax,
fee, or assessment which is unduly discriminatory against cable operators or
cable Subscribers); capital costs which are required by the Franchise to be
incurred by Grantee for public, educational, or governmental access facilities;
requirements or charges incidental to the awarding or enforcing of the
Franchise, including payments for bonds, security funds, letters of credit,
insurance, indemnification, penalties, or liquidated damages; or any fee imposed
under Title 17 of the United States Code. Franchise Fee defined herein shall be
the definition set forth in 47 U.S.C. § 542(g).

 

  m. “Grantee” is Knology of Montgomery, Inc. d/b/a Knology, Inc., its lawful
successors, transferees or assignees.

 

  n.

“Gross Revenue” means any and all revenue derived by Grantee from the operation
of its Cable System to provide Cable Service within the City including, but not
limited to, 1) all Cable Service fees, 2) Franchise Fees, 3) late fees and
returned check fees, 4) Installation and reconnection fees, 5) upgrade and
downgrade fees, 6) local, state and national advertising revenue, 7) home
shopping commissions, 8) equipment rental fees, and 9) written or electronic
Channel guide revenue. The term “Gross Revenue” shall not include launch fees,
bad debts or any taxes or fees on Services furnished by Grantee imposed upon

 

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Subscribers by any municipality, state or other governmental unit, including the
FCC regulatory fee, credits, refunds and any amounts collected from Subscribers
for deposits, PEG fees or PEG support. City and Grantee acknowledge and agree
that Grantee will maintain its books and records in accordance with generally
accepted accounting principles (GAAP).

 

  o. “Installation” means any connection of the System from feeder cable to the
point of connection including Standard Installations and custom Installations
with the Subscriber Converter or other terminal equipment.

 

  p. “Lockout Device” means an optional mechanical or electrical accessory to a
Subscriber’s terminal which inhibits the viewing of a certain program, certain
Channel, or certain Channels provided by way of the Cable System.

 

  q. “Normal Business Hours” means those hours during which most similar
businesses in City are open to serve customers. In all cases, “Normal Business
Hours” must include some evening hours, at least one (1) night per week and/or
some weekend hours. Normal Business Hours as defined herein shall be the
definition set forth in 47 C.F.R. § 76.309.

 

  r. “Normal Operating Conditions” means those Service conditions which are
within the control of Grantee. Those conditions which are not within the control
of Grantee include, but are not limited to, natural disasters, civil
disturbances, power outages, telephone network outages, and severe or unusual
weather conditions. Those conditions which are ordinarily within the control of
Grantee include, but are not limited to, special promotions, pay-per-view
events, rate increases, regular peak or seasonal demand periods, and maintenance
or upgrade of the Cable System. Normal Operating Conditions as defined herein
shall be the definition set forth in 47 C.F.R. § 76.309.

 

  s. “Other Programming Service” means information that a cable operator makes
available to all Subscribers generally. Other Programming Services as defined
herein shall be the definition set forth in 47 U.S.C. § 522(14).

 

  t. “PEG” means public, educational and governmental.

 

  u. “Person” is any Person, firm, partnership, association, corporation,
company, limited liability entity or other legal entity.

 

  v. “Right-of-Way” or “Rights-of-Way” means the area on, below, or above any
real property in City in which the City has an interest including, but not
limited to any street, road, highway, alley, sidewalk, parkway, utility
easements or any other place, area, or real property owned by or under the
control of City which are dedicated for compatible use.

 

  w. “Right-of-Way Ordinance” means any ordinance or other applicable code
requirements regarding regulation, management and use of Rights-of-Way in City,
including registration and permitting requirements.

 

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  x. “Service Area” or “Franchise Area” means the entire geographic area within
the City as it is now constituted or may in the future be constituted.

 

  y. “Service Interruption” means the loss of picture or sound on one (1) or
more Cable Channels. Service Interruption as defined herein shall be the
definition set forth in 47 C.F.R. § 76.309.

 

  z. “Standard Installation” means any residential or commercial Installation
which can be completed using a Drop of one hundred fifty (150) feet or less.

 

  aa. “Subscriber” means any Person who receives broadcast programming
distributed by a Cable System and does not further distribute it. Subscriber as
defined herein shall be the definition set forth in 47 C.F.R. § 76.5(ee).

 

  bb. “Video Programming” means programming provided by, or generally considered
comparable to programming provided by, a television broadcast station. Video
Programming as defined herein shall be the definition set forth in 47 U.S.C, §
522(20).

SECTION 2.

GRANT OF AUTHORITY AND GENERAL PROVISIONS

 

1. Grant of Franchise. This Franchise is granted pursuant to the terms and
conditions contained herein. Failure of Grantee to provide a System as described
herein, or meet the obligations and comply with all provisions herein, shall be
deemed a violation of this Franchise.

 

2. Grant of Nonexclusive Authority.

 

  a. The Grantee shall have the right and privilege, subject to the permitting
and other lawful requirements of City ordinance, rule or procedure, to
construct, erect, and maintain, in, upon, along, across, above, over and under
the Rights-of-Way in City a Cable System and shall have the right and privilege
to provide Cable Service. The System constructed and maintained by Grantee or
its agents shall not interfere with other uses of the Rights-of-Way. Grantee
shall make use of existing poles and other above and below ground facilities
available to Grantee to the extent it is technically and economically feasible
to do so.

 

  b. Notwithstanding the above grant to use Rights-of-Way, no Right-of-Way shall
be used by Grantee if City determines, in its sole discretion, that such use is
inconsistent with the terms, conditions, or provisions by which such
Right-of-Way was created or dedicated, or with the present use of the
Right-of-Way.

 

  c. This Franchise shall be nonexclusive, and City reserves the right to grant
use of said Rights-of-Way to any Person at any time during the period of this
Franchise for the provision of Cable Service.

 

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  d. The Grantee acknowledges and agrees that the City reserves the right to
grant one (1) or more additional franchises or other similar lawful
authorization to provide Cable Services within the City; provided, however, that
no such franchise or similar lawful authorization shall contain material terms
or conditions which, when considered as a whole, are substantially more
favorable or less burdensome to the competitive provider than the material terms
and conditions herein. The parties agree that this provision shall not require a
word for word identical franchise or authorization for a competitive entity so
long as the overall regulatory and financial burdens on each entity are
generally equivalent.

 

  e. Notwithstanding any provision to the contrary, should any non-wireless
facilities based entity provide Cable Service within the Franchise Area during
the term of this Franchise without a Franchise granted by the City and the City
has the legal authority under State and Federal law to impose a Franchise on
such entity, then Grantee shall have all rights which may be available to
assert, at Grantee’s option, that this Franchise is rendered “commercially
impracticable,” and invoke the modification procedures set forth in Section 625
of the Cable Act.

 

3. Lease or Assignment Prohibited. No Person may lease Grantee’s System for the
purpose of providing Cable Service until and unless such Person shall have first
obtained and shall currently hold a valid franchise or other lawful
authorization containing substantially similar burdens and obligations to this
Franchise. Any assignment of rights under this Franchise shall be subject to and
in accordance with the requirements of Section 9.5 of this Franchise. This
provision shall not prevent Grantee from complying with any commercial leased
access requirements or any other provisions of Applicable Law.

 

4. Franchise Term. This Franchise shall be in effect for a period of ten
(10) years from the date of execution by City, unless sooner renewed, revoked or
terminated as herein provided.

 

5. Previous Franchises. Upon acceptance by Grantee as required by Section 13.2
herein, this Franchise shall supersede and replace any previous ordinance or
other authorization granting a franchise to Grantee. Ordinance No. 67-89 dated
November 21, 1989, as amended, is hereby expressly repealed.

 

6. Compliance with Applicable Laws, Resolutions and Ordinances.

 

  a. The terms of this Franchise shall define the contractual rights and
obligations of Grantee with respect to the provision of Cable Service and
operation of the System in City. However, Grantee shall at all times during the
term of this Franchise be subject to all lawful exercise of the police power,
statutory rights, local ordinance-making authority of the City. This Franchise
may also be modified or amended with the written consent of City and Grantee as
provided in Section 12.3 herein.

 

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  b. Grantee shall comply with the terms of any City ordinance or regulation of
general applicability which addresses usage of the Rights-of-Way within City,
which may have the effect of superseding, modifying or amending the terms
herein, except that Grantee shall not, through application of such City
ordinance or regulation of Rights-of-Way, be subject to additional burdens with
respect to usage of Rights-of-Way which exceed burdens on similarly situated
Rights-of-Way users.

 

  c. In the event of any conflict between this Franchise and any City ordinance
or regulation which addresses usage of the Rights-of-Way, the terms of this
Franchise shall govern, provided however Grantee shall at all times comply with
City ordinances of general applicability promulgated by the City in accordance
with its police powers.

 

7. Rules of Grantee. Grantee shall have the authority to promulgate such rules,
regulations, terms and conditions governing the conduct of its business as shall
be reasonably necessary to enable said Grantee to exercise its rights and
perform its obligations under this Franchise and to assure uninterrupted Service
to each and all of its Subscribers; provided that such rules, regulations, terms
and conditions shall not be in conflict with Applicable Laws.

 

8. Territorial Area Involved. This Franchise is granted for the corporate
boundaries of City, as they exist from time to time. Access to Cable Service
shall not be denied to any group of potential cable Subscribers because of the
income of the potential cable Subscribers or the area in which such group
resides.

 

9. Written Notice. All notices, reports, or demands required to be given in
writing under this Franchise shall be sent via registered or certified mail or
shall be deemed to be given when delivered personally to any officer of Grantee
or City Clerk or forty-eight (48) hours after it is deposited in the United
States mail in a sealed envelope, postage prepaid thereon, addressed to the
party to whom notice is being given, as follows:

 

If to City:    City Clerk    P.O. Box 1111    Montgomery, Alabama 36101
If to Grantee:    Knology of Montgomery, Inc.    1241 O.G. Skinner Drive    West
Point, GA 31833    Attention: Director of Legal Affairs

Such addresses may be changed by either party upon notice to the other party
given as provided in this section.

 

10. Ownership of Grantee. Grantee represents and warrants to City that the names
of the shareholders, partners, members or other equity owners of the Grantee and
any of the shareholders, partners, members and/or other equity owners of Grantee
are as set forth in Exhibit A hereto.

 

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SECTION 3.

CONSTRUCTION STANDARDS

 

1. Registration, Permits, Construction Codes, and Cooperation.

 

  a. Grantee shall comply with the construction requirements of local, state and
federal laws.

 

  b. Grantee agrees to obtain a permit as required by City prior to removing,
abandoning, relocating or reconstructing, if necessary, any portion of its
facilities. Notwithstanding the foregoing, City understands and acknowledges
there may be instances when Grantee is required to make repairs, in compliance
with federal or state laws, that are of an emergency nature. Grantee will notify
City prior to such repairs, if practicable, and will obtain the necessary
permits in a reasonable time after notification to City.

 

  c. Reimbursement paid through the permitting process is separate and in
addition to any other fees included in the Franchise. Grantee, at the time of or
prior to submitting construction plans, shall provide City with a description of
the type of Service to be provided by the Grantee in sufficient detail for City
to determine compliance with the Franchise and Applicable Laws.

 

  d. City may issue reasonable policy guidelines to all grantees to establish
procedures for determining how to control issuance of engineering permits to
multiple grantees for the use of the same Rights-of-Way for their facilities.
Grantee shall cooperate with City in establishing such policy and comply with
the procedures established by the City Administrator or his or her designee to
coordinate the issuance of multiple engineering permits in the same Right-of-Way
segments.

 

  e. Grantee shall first obtain the written approval of City prior to commencing
any construction or reconstruction on the Rights-of-Way and public places of
City.

 

  f. Failure to obtain permits or comply with permit requirements shall subject
Grantee to all enforcement remedies available to City under Applicable Laws or
this Franchise.

 

  g. Grantee shall meet with developers and be present at pre-construction
meetings to ensure that the newly constructed Cable System facilities are
installed in new developments within City in a timely manner.

 

  h. If requested by the City, Grantee shall hold an annual meeting with City to
coordinate construction plans of both parties for the upcoming year.

 

2. Ongoing Construction. Grantee shall notify City at least ten (10) days prior
to the commencement of any construction in any Rights-of-Way. Grantee shall
provide to City

 

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a detailed site plan of any proposed construction or excavation. Grantee shall
not open or disturb the surface of any Rights-of-Way or public place for any
purpose without first having obtained a permit to do so in the manner provided
by law. All excavation shall be coordinated with other utility excavation or
construction so as to minimize disruption to the public. Any excavation shall be
backfilled without delay and lawns, berms, gardens, shrubs, and flower beds
returned and restored in as good a condition as before work involving such
disturbance was done. Any excessive or loose dirt, gravel, mud or sand shall be
removed from the property and deposited at an approval disposal site.

 

3. Use of existing poles or conduits.

 

  a. Grantee shall utilize existing and/or replacement poles, conduits and other
facilities whenever commercially reasonable and shall not construct or install
any new, different or additional poles, conduits or other facilities on public
property until the written approval of City is obtained. No location or any pole
or wire-holding structure of Grantee shall be a vested interest, and such poles
or structures shall be removed or modified by Grantee at its own expense
whenever City determines that the public convenience would be enhanced thereby.

 

  b. The facilities of Grantee shall be installed underground in those areas of
City where existing telephone and electric services are both underground at the
time of construction by Grantee. In areas where either telephone or electric
utility facilities are installed aerially at the time of System construction,
Grantee may install its facilities aerially; however, at such time as the
existing aerial facilities are placed underground, Grantee shall likewise place
its facilities underground at its sole cost. If City requires utilities to bury
lines which are currently overhead, and the City financially participates in
said undergrounding, then the City will consider providing the same cost sharing
to the Grantee.

 

  c. To the extent permitted under Grantee’s pole attachment agreements, City
shall have the right to over-lash additional cable and related attachments to
Grantee’s System free of charge. Where such over-lashing is pursuant to a
planned large-scale construction project, City shall provide a minimum of ten
(10) days advance notice to the Grantee. For all other over-lashing, City shall
provide notice that is reasonably practicable under the circumstances. The City
rights to over-lash facilities on Grantee’s System shall be limited to City
owned facilities which are to be used for noncommercial,
governmental/educational applications.

 

4. Minimum Interference.

 

  a. Grantee shall use its best efforts to give reasonable prior notice to any
adjacent private property owners who will be negatively affected or impacted by
Grantee’s work in the Rights-of-Way.

 

  b. All transmission and distribution structures, lines and equipment erected
by Grantee shall be located so as to cause minimum interference with the
unencumbered use of Rights-of-Way and other public places and minimum
interference with the rights and reasonable convenience of property owners who
adjoin any of the Rights-of-Way and public places.

 

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  c. Except as may be reasonably required to gain access to easements, Grantee
shall provide advance notice to any private property owner and shall obtain
authorization prior to commencing work on private property. The City
acknowledges that it may be impractical to provide such notice with regard to
work in an easement running along the backs of a lot.

 

5. Disturbance or damage. Any and all Rights-of-Way, or public or private
property, which are disturbed or damaged during the construction, repair,
replacement, relocation, operation, maintenance, expansion, extension or
reconstruction of the System shall be promptly and fully restored by Grantee, at
its expense, to a condition as good as that prevailing prior to Grantee’s work,
as determined by City. If Grantee shall fail to promptly perform the restoration
required herein, after written request of City and reasonable opportunity to
satisfy that request, City shall have the right to put the Rights-of-Way back
into condition as good as that prevailing prior to Grantee’s work. In the event
City determines that Grantee is responsible for such disturbance or damage,
Grantee shall be obligated to fully reimburse City for such restoration within
thirty (30) days after its receipt of City’s invoice thereof.

 

6. Temporary Relocation.

 

  a. At any time during the period of the Franchise, Grantee shall, at its own
expense, protect, support, temporarily disconnect, relocate or remove any of its
property when, in the opinion of City, (i) the same is required by reason of
traffic conditions, public safety, Rights-of-Way vacation, freeway or
Rights-of-Way construction, alteration to or establishment of any Rights-of-Way
or any facility within the Rights-of-Way, sidewalk, or other public place,
including but not limited to, installation of sewers, drains, waterlines, power
lines, traffic signal lines or transportation facilities; or (ii) a City project
or activity makes disconnection, removal, or relocation necessary or less
expensive for City.

 

  b. Grantee shall, on request of any Person holding a permit to move a
building, temporarily raise or lower its wires to permit the movement of such
buildings. The expense of such temporary removal or raising or lowering of wires
shall be paid by the Person requesting the same, and Grantee shall have the
authority to require such payment in advance. Grantee shall be given not less
than five (5) days advance notice to arrange such temporary wire alterations.

 

7. Emergency. Whenever, in case of fire or other emergency, it becomes necessary
in the judgment of the City Administrator, police chief, fire chief, or their
delegates, to remove or damage any of Grantee’s facilities, no charge shall be
made by Grantee against City for restoration, repair or damages.

 

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8. Tree Trimming. Grantee shall comply with all applicable provisions of the
Code of Ordinances of the City regarding the trimming of any tress on public
property or in the Rights-of-Way.

 

9. Protection of facilities. Nothing contained in this section shall relieve any
Person from liability arising out of the failure to exercise reasonable care to
avoid damaging Grantee’s facilities while performing any work connected with
grading, regrading or changing the line of any Rights-of-Way or public place or
the construction or reconstruction of any sewer or water system.

 

10. Installation records. Each Grantee shall keep accurate Installation records
of the location of all facilities in the Rights-of-Way and public ways and
furnish them to City upon reasonable request. Grantee shall cooperate with City
to furnish such information in an electronic mapping format, if reasonably
possible compatible with the then-current City electronic mapping format. Upon
completion of new or relocation construction of underground facilities in the
Rights-of-Way and public ways, Grantee shall provide City with Installation
records in an electronic format, if reasonably possible compatible with the
then-current City electronic mapping format showing the location of the
underground and above ground facilities.

 

11. Locating facilities.

 

  a. If, during the design process for public improvements, City discovers a
potential conflict with proposed construction, Grantee shall either: (a) locate
and, if necessary, expose its facilities in conflict or (b) use a location
service under contract with City to locate or expose its facilities. Grantee is
obligated to furnish the location information in a timely manner, but in no case
longer than thirty (30) days.

 

  b. City reserves the prior and superior right to lay, construct, erect,
install, use, operate, repair, replace, remove, relocate, regrade, widen,
realign, or maintain any Rights-of-Way and public ways, aerial, surface, or
subsurface improvement, including but not limited to water mains, traffic
control conduits, cable and devices, sanitary or storm sewers, subways, tunnels,
bridges, viaducts, or any other public construction within the Rights-of-Way of
City limits.

 

12. City’s rights. Subject to Applicable Laws, when City uses its prior superior
right to the Rights-of-Way and public ways, Grantee shall move its property that
is located in the Rights-of-Way and public ways, at its own cost, to such a
location as City directs. Nothing in this Franchise shall be construed to
prevent City from constructing, maintaining, repairing or relocating sewers;
grading, paving, maintaining, repairing, relocating and/or altering any
Right-of-Way; constructing, laying down, repairing, maintaining or relocating
any water mains; or constructing, maintaining, relocating, or repairing any
sidewalk or other public work.

 

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13. Relocation delays.

 

  a. Subject to Grantee’s compliance with Section 3.12 above, if Grantee’s
relocation effort so delays construction of a public project causing City to be
liable for delay damages, Grantee shall reimburse City for those damages
attributable to the delay created by Grantee. In the event Grantee should
dispute the amount of damages attributable to Grantee, the matter shall be
referred to the City engineer for a decision. In the event that Grantee
disagrees with the City engineer’s decision, the matter shall be submitted to
the Mayor for determination, whose decision shall be final and binding upon
Grantee as a matter of City review, but nothing herein waives any right of
appeal to the courts.

 

  b. In the event City becomes aware of a potential delay involving Grantee’s
facilities, City shall promptly notify Grantee of this potential delay.

 

14. Interference with City Facilities. The Installation, use and maintenance of
the Grantee’s facilities within the Rights-of-Way and public ways authorized
herein shall be in such a manner as not to interfere with City’s placement,
construction, use and maintenance of its Rights-of-Way and public ways,
Rights-of-Way lighting, water pipes, drains, sewers, traffic signal systems or
other City systems that have been, or may be, installed, maintained, used or
authorized by City.

 

15. Interference with Utility Facilities.

 

  a Grantee agrees not to install, maintain or use any of its facilities in such
a manner as to damage or interfere with any existing facilities of another
utility located within the Rights-of-Way and public ways of City and agrees to
relocate its facilities, if necessary, to accommodate another City facility
relocation.

 

  b Nothing in this section is meant to limit any rights Grantee may have under
Applicable Laws to be compensated for the cost of relocating its facilities from
the utility that is requesting the relocation.

 

16. Collocation. To maximize public and employee safety, to minimize visual
clutter of aerial plant, and to minimize the amount of trenching and excavation
in and along City Rights-of-Way and sidewalks for underground plant, Grantee
shall make every commercially reasonable effort to collocate compatible
facilities within the Rights-of-Way subject to the engineering requirements of
the owners of utility poles and other facilities.

 

17. Safety Requirements.

 

  a. Grantee shall at all times employ ordinary and reasonable care and shall
install and maintain in use nothing less than commonly accepted methods and
devices for preventing failures and accidents which are likely to cause damage
or injuries.

 

  b.

Grantee shall install and maintain its System and other equipment in accordance
with City’s codes and the requirements of the National Electric Safety Code and

 

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all other applicable FCC, state and local regulations, and in such manner that
they will not interfere with City communications technology related to health,
safety and welfare of the residents.

 

  c. Cable System structures, and lines, equipment and connections in, over,
under and upon the Rights-of-Way of City, wherever situated or located, shall at
all times be kept and maintained in good condition, order, and repair so that
the same shall not menace or endanger the life or property of City or any
Person.

SECTION 4.

DESIGN PROVISIONS

 

1. System Upgrade/Construction: Minimum Channel Capacity.

 

  a. Grantee shall operate and maintain for the term of this Franchise a System
providing a minimum of 750 MHz capacity. Design specifications found in Exhibit
E attached hereto are hereby incorporated as part of this Franchise.

 

  b. The System will utilize a hybrid fiber-coaxial architecture. In addition,
the System will be designed with the capability to transmit return signals
upstream in the 5-40 MHz spectrum. In conjunction with the upgrade/construction,
Grantee shall replace any existing headend equipment with state-of-the-art
standard frequency headend equipment which is technically necessary to meet FCC
technical standards.

 

  c. Grantee shall operate and maintain a System capable of providing non-video
services such as high-speed data transmission, Internet access, and Other
Programming Services.

 

  d. All final programming decisions remain the discretion of Grantee in
accordance with this Franchise, provided that Grantee notifies City and
Subscribers in writing thirty (30) days prior to any Channel additions,
deletions, or realignments, and further subject to Grantee’s signal carriage
obligations hereunder and pursuant to 47 U.S.C. § 531-536, and further subject
to City’s rights pursuant to 47 U.S.C. § 545. Location and relocation of the PEG
Channels shall be governed by Section 6 and Exhibit B.

 

2. System Construction.

On or about thirty (30) days prior to any system construction, affected
Subscribers will receive a letter notifying them of same, which letter shall
include Grantee’s telephone number that Subscribers can use to contact Grantee
with any questions or concerns they may have. No less than forty-eight
(48) hours before construction, all affected houses will receive written
notification regarding Grantee’s construction schedule which will also include
the scope of work to be performed and Grantee’s telephone number. Nothing shall
prohibit Grantee from consolidating the notices required in this subparagraph.

 

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3. Interruption of Service. Grantee shall interrupt Service only for good cause
and for the shortest time possible. Such interruption shall occur during periods
of minimum use of the System. If Service is interrupted for a total period of
more than twenty-four (24) continuous hours in any thirty (30) day period,
Subscribers shall be credited pro rata for such interruption.

 

4. Emergency Alert Capability. Grantee shall immediately provide the System
capability to allow the City to transmit from the Emergency Operation Center,
911 Communications Parkway, or other said location at City’s discretion, an
emergency alert signal to all participating Subscribers, in the form of an audio
message on all Channels within the City simultaneously in the event of disaster
or public emergency. The City shall be solely responsible for the content of any
message which the City generates on the emergency alert system. Grantee shall
only be responsible for the proper functioning of the emergency alert system. In
addition, Grantee shall at all times comply with the Emergency Alert System
standards pursuant to Title 47, Section 11, Subparts A-E of the Code of Federal
Regulations, as may be amended or modified from time to time.

 

5. Technical Standards. The technical standards used in the operation of the
System shall comply, at minimum, with the technical standards promulgated by the
FCC relating to Cable Systems pursuant to Title 47, Section 76, Subpart K of the
Code of Federal Regulations, as may be amended or modified from time to time,
which regulations are expressly incorporated herein by reference. In addition,
Grantee is subject to the technical standards outlined in Exhibit E attached
hereto.

 

6. Special Testing.

 

  a. City shall have the right to inspect and test all construction or
Installation work performed pursuant to the provisions of the Franchise. In
addition, City may require special testing of a location or locations within the
System as desired at any time during the term of this Franchise. Demand for such
special tests may be made on the basis of complaints received or other evidence
indicating an unresolved controversy or noncompliance or for routine
verification of Grantee’s compliance with FCC technical standards. City shall
endeavor to so arrange its request for such special testing so as to minimize
hardship or inconvenience to Grantee or to the Subscribers caused by such
testing.

 

  b. Before ordering such tests, Grantee shall be afforded thirty (30) days
advance written notice. City shall meet with Grantee prior to requiring special
tests to discuss the need for such and, if possible, visually inspect those
locations which may be the focus of concern. If, after such meetings and
inspections, City wishes to require special tests and the thirty (30) days have
elapsed, the tests shall be conducted by Grantee at Grantee’s expense and may be
observed by a qualified engineer selected by City. Grantee shall participate and
cooperate in such testing and shall not assess City or Subscribers any
additional fees or costs associated with time or labor Grantee may incur as a
result of its participation in such testing.

 

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7. FCC Reports. The results of any tests required to be filed by Grantee with
the FCC shall upon request of City also be filed with City or its designee
within ten (10) days of the date of request.

 

8. Interconnection. At the request of the City, Grantee shall interconnect with
adjacent Cable Systems to facilitate the two-way distribution of PEG Access
Channels and/or Institutional Network. All decisions regarding whether to
interconnect and the terms and conditions of any such interconnect shall be a
matter of agreement between the cable operators involved. If the cable operators
are unable to reach agreement the City shall, in its sole discretion, have
authority to impose reasonable interconnection requirements and the costs of
such interconnection shall be proportionately divided between the cable
operators.

 

9. Annexation. Upon the annexation of any additional land area by the City, if
the annexed area is not currently served by a cable operator it will be subject
to the other provisions of this Section 4. If the annexed area is served by a
cable operator, Grantee has the option to extend its Cable System to the newly
annexed area if Grantee determines that it is economically feasible to do so.
Upon the annexation of any additional land area by the City, the annexed area
shall be subject to all the terms of this Franchise upon sixty (60) days of
written notification by the City to Grantee. A cable operator other than Grantee
whose Cable System already passes homes in an annexed area shall not extend its
Cable System beyond those homes which it passes at the time the annexation
occurs unless it otherwise obtains a franchise from the City.

 

10. Line Extension.

 

  a. Grantee shall construct and operate its Cable System so as to provide
Service to all parts of its Franchise area as provided in this Franchise and
having a density equivalent of thirty (30) residential units per cable mile of
System, as measured from the nearest tap on the Cable System.

 

  b. Where the density is less than that specified above, Grantee shall inform
Persons requesting Service of the possibility of paying for Installation or a
line extension and shall offer to provide them with a free written estimate of
the cost, which shall be provided within fifteen (15) working days of such a
request. The charge for Installation or extension for each Person requesting
Service shall not exceed a pro rata share of the actual cost of extending the
Service.

 

  c. Any residential and/or commercial unit located within one hundred fifty
(150) feet of the nearest tap on Grantee’s System shall be connected to the
System at no charge other than the Standard Installation charge. Grantee shall,
upon request by any potential Subscriber residing in City beyond the one hundred
fifty (150) foot limit, extend Service to such Subscriber provided that the
Subscriber shall pay the net additional Drop costs.

 

  d.

Under Normal Operating Conditions, if Grantee cannot perform Installations
within the times specified in applicable customer standards, the Subscriber may

 

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request and is entitled to receive a credit equal to the charge for a Standard
Installation. For any Installation that is not a free Installation or a Standard
Installation, Grantee shall provide the Subscriber with a written estimate of
all charges within seven (7) days of a request by the Subscriber. Failure to
comply will subject Grantee to appropriate enforcement actions. This section
does not apply to the introduction of new products and services when Grantee is
utilizing a phased introduction.

 

11. Lockout Device. Upon the request of a Subscriber, Grantee shall make
available by sale or lease a Lockout Device allowing Channels on the System to
be blocked.

SECTION 5.

SERVICE PROVISIONS

 

1. Regulation of Service Rates. City may regulate rates for the provision of
Cable Service, equipment, or any other communications service provided over the
System in accordance with applicable federal law, in particular 47 C.F.R. Part
76 subpart N. In the event the City has the legal authority to regulate rates
and chooses to regulate rates it shall, in accordance with 47 C.F.R. § 76.910,
obtain certification from the FCC, if applicable. The City shall follow all
applicable FCC rate regulations and shall ensure that appropriate personnel are
in place to administer such regulations. City reserves the right to regulate
rates for any future Services to the extent permitted by law.

 

2. Non-Standard Installations. Grantee shall install and provide Cable Service
to any Person requesting other than a Standard Installation provided that said
Cable Service can meet FCC technical specifications and all payment and policy
obligations are met. In such case, Grantee may charge for the incremental
increase in material and labor costs incurred beyond the Standard Installation.

 

3. Sales Procedures. Grantee shall not exercise deceptive sales procedures when
marketing any of its Services within City. In its initial communication or
contact with a non-Subscriber or current Subscriber seeking alternative options,
Grantee shall inform the non-Subscriber of all levels of Service available,
including the lowest priced Basic Cable Service tier and free Service tiers.
Grantee shall have the right to market door-to-door during reasonable hours
consistent with local ordinances and regulation.

 

4. Consumer Protection and Service Standards. Grantee shall maintain a
convenient local customer service and bill payment location in the City for
receiving Subscriber payments, handling billing questions, equipment replacement
and customer service information. The Grantee shall comply with the standards
and requirements for customer service set forth below and shall comply with all
applicable regulations relating to customer service obligations, including any
amendments to 47 C.F.R. § 76.309 during the term of this Franchise.

 

  a. Cable System office hours and telephone availability.

 

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  i. Grantee will maintain a local, toll-free or collect call telephone access
line which will be available to its Subscribers twenty-four (24) hours a day,
seven (7) days a week.

 

  (1) Trained Grantee representatives will be available to respond to customer
telephone inquiries during Normal Business Hours.

 

  (2) After Normal Business Hours, the access line may be answered by a service
or an automated response system, including an answering machine. Inquiries
received after Normal Business Hours must be responded to by a trained Grantee
representative on the next business day.

 

  ii. Under Normal Operating Conditions, telephone answer time by a customer
representative, including wait time, shall not exceed thirty (30) seconds when
the connection is made. If the call needs to be transferred, transfer time shall
not exceed thirty (30) seconds. These standards shall be met no less then ninety
percent (90%) of the time under Normal Operating Conditions, measured on a
quarterly basis.

 

  iii. Grantee shall not be required to acquire equipment or perform surveys to
measure compliance with the telephone answering standards above unless an
historical record of complaints indicates a clear failure to comply.

 

  iv. Under Normal Operating Conditions, the customer will receive a busy signal
less than three percent (3%) of the time.

 

  v. Customer service center and bill payment locations will be open at least
during Normal Business Hours and will be conveniently located.

 

  b. Installations, Outages and Service Calls. Under Normal Operating
Conditions, each of the following standards will be met no less than ninety-five
percent (95%) of the time measured on a quarterly basis.

 

  i. Standard Installations will be performed within seven (7) business days
after an order has been placed. “Standard” Installations are those that are
located up to one hundred fifty (150) feet from the existing distribution
system.

 

  ii. Excluding conditions beyond the control of Grantee, Grantee will begin
working on “Service Interruptions” promptly and in no event later than
twenty-four (24) hours after the interruption becomes known. Grantee must begin
actions to correct other Service problems the next business day after
notification of the Service problem.

 

  iii. The “appointment window” alternatives for Installations, Service calls,
and other Installation activities will be either a specific time or, at maximum,
a four (4) hour time block during Normal Business Hours.

 

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(Grantee may schedule Service calls and other Installation activities outside of
Normal Business Hours for the express convenience of the customer.)

 

  iv. Grantee may not cancel an appointment with a customer after the close of
business on the business day prior to the scheduled appointment.

 

  v. If Grantee’s representative is running late for an appointment with a
customer and will not be able to keep the appointment as scheduled, the customer
will be contacted. The appointment will be rescheduled, as necessary, at a time
which is convenient for the customer.

 

  c. Communications between Grantee and Subscribers.

 

  i. Notifications to Subscribers:

 

  (1) Grantee will provide written information on each of the following areas at
the time of Installation of Service, at least annually to all Subscribers, and
at any time upon request:

 

  (a) Products and Services offered;

 

  (b) Prices and options for programming Services and conditions of subscription
to programming and other Services;

 

  (c) Installation and Service maintenance policies;

 

  (d) Instructions on how to use the Cable Service;

 

  (e) Channel positions of programming carried on the System; and

 

  (f) Billing and complaint procedures, including the address and telephone
number of the City’s cable office.

 

  (2) Subscribers will be notified of any changes in rates, programming Services
or Channel positions as soon as possible in writing. Notice must be given to
Subscribers a minimum of thirty (30) days in advance of such changes if the
change is within the control of the Grantee. In addition, the Grantee shall
notify Subscribers thirty (30) days in advance of any significant changes in the
other information required by Section 5.4(c)(i)(l).

 

  (3)

In addition to the requirement of subparagraph (2) of this section regarding
advance notification to Subscribers of any changes in rates, programming
services or Channel positions, Grantee shall give thirty (30) days written
notice to both Subscribers and the

 

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City before implementing any rate or Service change. Such notice shall state the
precise amount of any rate change and briefly explain in readily understandable
fashion the cause of the rate change (e.g., inflation, change in external costs
or the addition/deletion of Channels). When the change involves the addition or
deletion of Channels, each Channel added or deleted must be separately
identified. For purposes of the carriage of digital broadcast signals, the
Grantee need only identify for Subscribers, the television signal added and not
whether that signal may be multiplexed during certain dayparts.

 

  (4) To the extent Grantee is required to provide notice of Service and rate
changes to Subscribers, the Grantee may provide such notice using any reasonable
written means at its sole discretion.

 

  (5) Notwithstanding any other provision of this section, Grantee shall not be
required to provide prior notice of any rate change that is the result of a
regulatory fee, Franchise Fee, or any other fee, tax, assessment, or charge of
any kind imposed by any federal agency, state, or City on the transaction
between the Grantee and the Subscriber.

 

  ii. Billing:

 

  (1) Consistent with 47 C.F.R. § 76.1619, bills will be clear, concise and
understandable. Bills must be fully itemized, with itemizations including, but
not limited to, Basic Cable Service and premium Service charges and equipment
charges. Bills will also clearly delineate all activity during the billing
period, including optional charges, rebates and credits.

 

  (2) In case of a billing dispute, the Grantee must respond to a written
complaint from a Subscriber within thirty (30) days.

 

  iii. Refunds: Refund checks will be issued promptly, but no later than either:

 

  (1) The Subscriber’s next billing cycle following resolution of the request or
thirty (30) days, whichever is earlier, or

 

  (2) The return of the equipment supplied by Grantee if Service is terminated.

 

  iv. Credits: Credits for Service will be issued no later than the Subscriber’s
next billing cycle following the determination that a credit is warranted.

Grantee shall provide City with a quarterly compliance report specific to the
System in the Service Area, which report information shall describe in detail
Grantee’s compliance with each and every term and provision of this section.

 

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5. Subscriber Contracts. Grantee shall file with City any standard form
residential Subscriber contract utilized by Grantee. If no such written contract
exists, Grantee shall file with the City a document completely and concisely
stating the length and terms of the Subscriber contract offered to customers.
The length and terms of any Subscriber contract(s) shall be available for public
inspection during Normal Business Hours. A list of Grantee’s current Subscriber
rates and charges for Cable Service shall be maintained on file with City and
shall be available for public inspection.

 

6. Refund Policy. If a Subscriber’s Cable Service is interrupted or discontinued
without cause, for twenty-four (24) or more consecutive hours, the Grantee
shall, upon request by Subscriber, credit such Subscriber pro rata for such
interruption. For this purpose, every month will be assumed to have thirty
(30) days.

 

7. Late Fees. Grantee shall comply with all applicable state and federal laws
with respect to any assessment, charge, cost, fee or sum, however characterized,
that the Grantee imposes upon a Subscriber for late payment of a bill. The City
reserves the right to enforce Grantee’s compliance with all Applicable Laws to
the maximum extent legally permissible.

 

8. Local Office Policy.

 

  a. Grantee shall maintain a location in City for receiving Subscriber
inquiries, bill payments, and equipment transfers. The location must be staffed
by a Person capable of receiving inquiries and bill payments and the location
shall be open a minimum of forty (40) hours per week. In addition, Grantee shall
maintain a drop box locations within the Service Area for receiving Subscriber
payments after hours.

 

  b. Payments at Grantee’s drop box locations shall be deemed received on the
date such payments are picked up by Grantee which shall occur no less than
twenty- four (24) hours after each and every due date for Subscriber bills.

SECTION 6.

ACCESS CHANNEL(S) PROVISIONS

 

1. Grantee Support for PEG Access. Grantee shall provide the following support
for PEG access usage within the Service Area:

 

  a. Provision of the Channels designated in Exhibit B of this Agreement for
local PEG programming and access use at no charge in accordance with the
requirements of Exhibit B.

 

  b. Support of PEG programming to the extent specified in Exhibit B of this
Agreement.

 

  c. Provision of free public building Installation and Cable Service and a
fiber connection to City’s network as more clearly specified in Exhibit B.

 

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2. Compliance with Federal Law. Grantee and City agree that the PEG access
support fee referenced in Exhibit B will not be deemed to be “Franchise Fees”
within the meaning of Section 622 of the Cable Act (47 U.S.C. §542), and such
obligations shall not be deemed to be (i) “payments in kind” or any involuntary
payments chargeable against the Franchise Fees to be paid to the City by Grantee
pursuant to Section 7 hereof or (ii) part of the Franchise Fees to be paid to
City by Grantee pursuant to Section 7 hereof.

SECTION 7.

OPERATION AND ADMINISTRATION PROVISIONS

 

1. Administration of Franchise. The City Administrator or other designee shall
have continuing regulatory jurisdiction and supervision over the System and the
Grantee’s operation under the Franchise; provided, however, that the City
Council shall retain the sole authority to take enforcement action pursuant to
this Franchise.

 

2. Delegated-Authority. The City may appoint a citizen advisory body or may
delegate to any other body or Person authority to monitor the performance of
Grantee pursuant to the Franchise. Grantee shall cooperate with any such
delegates of City.

 

3. Franchise Fee.

 

  a. During the term of the Franchise, Grantee shall pay quarterly to City a
Franchise Fee in an amount equal to five percent (5%) of its quarterly Gross
Revenues, or such other amounts as are subsequently permitted by federal
statute.

 

  b. Any payments due under this provision shall be payable quarterly. The
payment shall be made within forty-five (45) days of the end of each of
Grantee’s fiscal quarters together with a report showing the basis for the
computation in form and substance substantially the same as Exhibit F attached
hereto. In the event that a Franchise Fee payment or other sum due is not
received by the City on or before the date due, or is underpaid, Grantee shall
pay in addition to the payment, or sum due, interest from the due date at an
annual rate equal to prune plus two percent (2%).

 

  c. All amounts paid shall be subject to audit and recomputation by City and
acceptance of any payment shall not be construed as an accord that the amount
paid is in fact the correct amount. In the event the City should conduct a
review of Grantee’s books and records pursuant to Section 7.6 of this Franchise
and such review indicates a Franchise Fee underpayment of two percent (2%) or
more, the Grantee shall assume all reasonable documented costs of such audit,
and pay same upon demand by the City.

 

4. Discounted Rates. If Grantee’s Subscribers are offered what is, in effect, a
discount for “bundled” services (i.e. Subscribers obtain Cable Services and some
other, non-cable goods or service) then for the purpose of calculating Gross
Revenues, the discount shall be applied proportionately to cable and non-cable
goods and services, in accordance with the following example:

 

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Assume a Subscriber’s charge for a given month for Cable Service alone would be
$40, for local telephone service alone would be $30, and for high-speed service
alone would be $30, for a total of $100. In fact, the three (3) services are
offered in effect at a combined rate where the Subscriber receives what amounts
to a twenty percent (20%) discount from the rates that would apply to a service
if purchased individually (i.e. $80 per month for all three (3) services). The
discount (here, $20) for Gross Revenue computation purposes would be applied pro
rata so that Gross Revenues for Cable Service are deemed to be $32 ($40 less 20%
of $40). The result would be the same if the Subscriber received a $20 discount
for telephone service on the condition that he or she also subscribes to Cable
Service at standard rates.

In no event shall Grantee be permitted to evade or reduce applicable franchise
fee payments required to be made to City due to discounted bundled services.

 

5. Not Franchise Fees.

 

  a. Grantee acknowledges and agrees that the Franchisee Fees payable by Grantee
to City pursuant to this section shall take precedence over all other payments,
contributions, services, equipment, facilities, support, resources or other
activities to be provided or performed by Grantee pursuant to this Franchise and
that the Franchise Fees provided for in this section of this Franchise shall not
be deemed to be in the nature of a tax, and shall be in addition to any and all
taxes of general applicability and other fees and charges which Grantee shall be
required to pay to City and/or to any other governmental authority, all of which
shall be separate and distinct obligations of Grantee.

 

  b. Grantee shall not apply or seek to apply or make any claim that all or any
part of the Franchisee Fees or other payments or contributions to be made by
Grantee to City pursuant to this Franchise shall be deducted from or credited or
offset against any taxes, fees or assessments or general applicability levied or
imposed by City or any other governmental authority, including any such tax, fee
or assessment imposed on both utilities and cable operators or their services.

 

  c. Grantee shall not apply or seek to apply all or any part of any taxes, fees
or assessments or general applicability levied or imposed by the City or any
other governmental authority (including any such tax, fee or assessment imposed
on both utilities and cable operators or their services) as a deduction or other
credit from or against any of the Franchise Fees or other payments or
contributions to be paid or made pursuant by Grantee to City to this Franchisee
which shall be deemed to be separate and distinct obligations of Grantee.

 

6.

Access to Records. The City shall have the right to inspect, upon reasonable
notice and during Normal Business Hours, or require Grantee to provide within a
reasonable time copies of any records maintained by Grantee which relate to
System operations including specifically Grantee’s accounting and financial
records. City acknowledges that some of

 

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the records which may be provided by Grantee may be classified as confidential
and therefore may subject Grantee to competitive disadvantage if made public.
City shall therefore maintain the confidentiality of any and all records
provided to it by Grantee which are not required to be made public pursuant to
Applicable Laws. Grantee shall produce such books and records for City’s
inspection at Grantee’s local office within the Service Area or at such other
mutually agreed upon location within the City. To the extent it is necessary for
City to send representatives to a location outside of the City to inspect
Grantee’s books and records, Grantee shall be responsible for all travel costs
incurred by City representatives.

 

7. Reports and Maps to be Filed with City.

 

  a. Grantee shall file with the City, at the time of payment of the Franchise
Fee, a report of all Gross Revenues in form and substance as Exhibit F attached
hereto.

 

  b. If required by City, Grantee shall provide City a written or
computer-stored record of all service calls and interruptions or degradation of
Service experienced for the preceding two (2) years, provided that such
complaints result in or require a service call, subject to the Subscriber’s
right of privacy.

 

  c. City and Grantee shall mutually agree, at the times and in the form
prescribed, such other reasonable reports with respect to Grantee’s operations
pursuant to this Franchise.

 

  d. If required by City, Grantee shall furnish to and file with City
Administrator the maps, plats, and permanent records of the location and
character of all facilities constructed, including underground facilities, and
Grantee shall file with City updates of such maps, plats and permanent records
annually if changes have been made in the System.

 

8. Periodic Evaluation.

 

  a. City may require evaluation sessions at any time during the term of this
Franchise, upon fifteen (15) days written notice to Grantee.

 

  b. Topics which may be discussed at any evaluation session may include, but
are not limited to, application of new technologies, System performance,
programming offered, access Channels, facilities and support, municipal uses of
cable, Subscriber rates, customer complaints, amendments to this Franchise,
judicial rulings, FCC rulings, line extension policies and any other topics City
deems relevant.

 

  c. As part of any periodic evaluation proceeding the City shall have the right
to visit and/or inspect the Grantee’s headend facility, customer service center
and any other facilities of Grantee whether or not located in the City to the
extent such facilities are in any way related to Grantee’s ability to provide
Cable Services to the City.

 

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  d. As a result of a periodic review or evaluation session, upon notification
from City, Grantee shall meet with City and undertake good faith efforts to
reach agreement on changes and modifications to the terms and conditions of the
Franchise which are both economically and technically feasible as measured over
the remaining life of the Franchise.

SECTION 8.

GENERAL FINANCIAL AND INSURANCE PROVISIONS

 

1. Letter of Credit

 

  a. In the event that the City has reason to believe that the Grantee has
defaulted in the performance of any provision of this Franchise, except as
excused by force majeure, the City shall notify the Grantee in writing, by
certified mail, of the provision or provisions of which the City believes
Grantee to be in default and the details relating thereto (“Alleged Default
Notice”).

 

  b. Within ten (10) days of receipt of an Alleged Default Notice from the City,
Grantee shall provide the City with an irrevocable letter of credit in the sum
of Seventy-Five Thousand and No/100 Dollars ($75,000.00). The letter of credit
shall insure the faithful performance by the Grantee of all the provisions of
this Franchise, and compliance with all orders, permits and directions of the
City and the payment by Grantee of any claim, penalties, damages, liens and
taxes due the City related thereto or which arise by reason of the construction,
operation or maintenance of the Cable System. The letter of credit shall be
provided by Grantee regardless of whether Grantee disputes the alleged
violation. Any failure by Grantee to provide the letter of credit as required
herein shall constitute a separate breach of this Franchise. Once the proceeding
addressing the alleged violation has been completed the Grantee shall be
relieved of maintaining the letter of credit until such time as another alleged
violation notification is received by Grantee at which time the process shall
begin again.

 

  c. The Grantee shall have thirty (30) days from the receipt of an Alleged
Default Notice to:

 

  i. Respond to the City in writing, contesting the City’s assertion of default
and providing such information or documentation as may be necessary to support
the Grantee’s position; or

 

  ii. Cure any such default. The time for Grantee to correct any violation or
liability shall be extended by City if the necessary action to correct such
violation or liability is of such a nature or character as to require more than
thirty (30) days within which to perform, provided Grantee provides written
notice that it requires more than thirty (30) days to correct such violations or
liability, commences the corrective action within the thirty (30) day period and
thereafter uses reasonable diligence to correct the violation or liability.

 

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  d. In the event that the City finds that Grantee failed to respond to such an
Alleged Default Notice to cure the default or to take reasonable steps to cure
the default, the City shall promptly schedule a public hearing to consider that
matter. The City shall provide written notice at least fourteen (14) days prior
to the date of the hearing. The Grantee shall be provided reasonable opportunity
to offer evidence and be heard at such public hearing.

 

  e. In the event that the City, after public hearing, determines that a
continuing state of default exists and that its cure is unlikely or untimely,
the City may determine to pursue one (1) of the following:

 

  i. assess liquidated damages in accordance with the schedule set forth in
Section 8.2 below;

 

  ii. determine the amount of actual damages to the City of the default and draw
upon all or any appropriate part of the letter of credit provided herein;

 

  iii. seek specific performance of any provision in this Franchise which
reasonably lends itself to such remedy, as an alternative to damages;

 

  iv. pursue a separate action for damages in a court of competent jurisdiction;

 

  v. pursue the procedures for revocation of the Franchise under Section 9.2
herein; or

 

  vi. invoke any other lawful remedy available to the City.

 

  f. If the City draws upon the letter of credit or any subsequent letter of
credit delivered pursuant hereto, in whole or in part, the City shall provide
written notice of such draw to Grantee and Grantee shall replace or replenish to
its full amount the same within ten (10) days after such notice. This shall be a
continuing obligation for any draws upon the letter of credit.

 

  g. If the City determines that a default exists after a public hearing, the
Grantee shall have the right to a review of such decision in any court of
competent jurisdiction.

 

2. Liquidated Damages

 

  a. For the violation of any of the following provisions of this Franchise,
liquidated damages shall be paid by the Grantee to the City, subject to the due
process provisions of Section 8.1 above. Any such liquidated damages shall be
assessed as of the date the Grantee received the Alleged Default Notice.

 

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  i. For failure to provide documents, reports, maps or information required by
the terms of this Franchise, One hundred and No/100 Dollars ($100.00) for each
day that such failure occurs or continues.

 

  ii. For failure to provide the Cable Services Grantee has agreed to provide,
including the requirements to maintain and operate the Cable System in
accordance with Section 4 herein, One hundred and No/100 Dollars ($100.00) per
day, for each day that such failure occurs or continues

 

  iii. For failure to comply with Section 6 and Exhibit B regarding PEG
Channels, One hundred fifty and No/100 Dollars ($150.00) per day for each day
that such violation exists.

 

  iv. For failure to materially comply with Customer Service Standards set forth
in Section 5 herein, one hundred and No/100 Dollars ($100.00) per day for each
day the violation continues, except where compliance is measured quarterly, in
which case liquidated damages shall be as follows: (a) Franchisee shall be
liable for liquidated damages in the amount of two thousand and No/100 Dollars
($2,000.00) for the first offence for each quarter in which such standards were
not met; four thousand and No/100 Dollars ($4,000.00) for the second offence for
each quarter in which such standards were not met; and six thousand and No/100
Dollars ($6,000.00) for the third offence for each quarter in which such
standards were not met.

 

  b. Each of the above-mentioned cases of non-compliance result in damage to the
City, its residents, businesses and institutions, compensation for which will be
difficult or impossible to ascertain. The Grantee agrees that the liquidated
damages in the amounts set forth above are fair and reasonable compensation for
such damage. The Grantee agrees that said foregoing amounts are liquidated
damages not a penalty or forfeiture, and are within one (1) or more exclusions
to the term “Franchise Fee” provided by Section 622(g)(2)(A)-(D) of the Cable
Act.

 

  c. Payment of liquidated damages mandated by the City in accordance with the
terms of this Franchise shall be considered a cure and full and final resolution
of the alleged violation for the time period specified and shall not thereafter
be considered, for any purpose, as an event of noncompliance for such specified
period. Nothing herein shall prevent the City from initiating another violation
proceeding pursuant to the terms of this Franchise in the event another alleged
violation of such provision of the Franchise should arise.

 

3. Liability Insurance.

 

  a.

Upon the effective date, Grantee shall, at its sole expense take out and
maintain during the term of this Franchise commercial general liability
insurance with a company licensed to do business in the State of Alabama with a
rating by A.M. Best & Co. of not less than “B” that shall protect the Grantee,
City and its

 

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officials, officers, directors, employees and agents from claims which may arise
from operations under this Franchise, whether such operations be by the Grantee,
its officials, officers, directors, employees and agents or any subcontractors
of Grantee. This liability insurance shall include, but shall not be limited to,
protection against claims arising from bodily and personal injury and damage to
property, resulting from Grantee’s vehicles, products and operations. Grantee
shall maintain, throughout the term of the Franchise, liability insurance
insuring Grantee and the City in the minimum amounts of:

 

  i. Three Million and No/100 Dollars ($3,000,000.00) for bodily injury or death
to any one (1) Person;

 

  ii, Three Million and No/100 Dollars ($3,000,000.00) for bodily injury or
death resulting from any one accident;

 

  iii. Five Million and No/100 Dollars ($5,000,000.00) in the form of an
umbrella policy.

 

  b. The following endorsements shall be attached to the liability policy:

 

  i. The policy shall provide coverage on an “occurrence” basis.

 

  ii. The policy shall cover personal injury as well as bodily injury.

 

  iii. The policy shall cover blanket contractual liability subject to the
standard universal exclusions of contractual liability included in the carrier’s
standard endorsement as to bodily injuries, personal injuries and property
damage.

 

  iv. Broad form property damage liability shall be afforded.

 

  v. City shall be named as an additional insured on the policy.

 

  vi. An endorsement shall be provided which states that the coverage is primary
insurance and that no other insurance maintained by the City will be called upon
to contribute to a loss under this coverage.

 

  vii. Standard form of cross-liability shall be afforded.

 

  viii. An endorsement stating that the policy shall not be canceled without
thirty (30) days notice of such cancellation given to City.

 

  c. Grantee shall submit to City documentation of the required insurance,
including a copy of the policy showing that the City is an additional insured,
as well as all properly executed endorsements.

 

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4. Indemnification

 

  a. Grantee shall indemnify, defend and hold City, its officers, boards,
commissions, agents and employees (collectively the “Indemnified Parties”)
harmless from and against any and all lawsuits, claims, causes or action,
actions, liabilities, demands, damages, judgments, settlements, disability,
losses, expenses (including attorney’s fees and disbursements of counsel) and
costs of any nature that any of the Indemnified Parties may at any time suffer,
sustain or incur arising out of, based upon or in any way connected with the
Grantee’s operations, the exercise of the Franchise, the breach of Grantee of
its obligations under this Franchise and/or the activities of Grantee, it
subcontractors, employees and agents hereunder. Grantee shall be solely
responsible for and shall indemnify, defend and hold the Indemnified Parties
harmless from and against any and all matters relative to payment of Grantee’s
employees, including compliance with Social Security and withholdings. Grantee
shall not be required to provide indemnification to City for programming
cablecast over the PEG access Channels administered by City. Grantee shall not
be required to indemnify City for negligence or misconduct on the part of City
or its officials, boards, commissions, agents, or employees.

 

  b. The indemnification obligations of Grantee set forth in this Franchise are
not limited in any way by the amount or type of damages or compensation payable
by or for Grantee under Workers’ Compensation, disability or other employee
benefit acts, acceptance of insurance certificates required under this Franchise
or the terms, applicability or limitations of any insurance held by Grantee.

 

  c. City does not, and shall not, waive any rights against Grantee which it may
have by reason of the indemnification provided for in this Franchise, because of
the acceptance by City, or the deposit with City by Grantee, of any of the
insurance policies described in this Franchise.

 

  d. The indemnification of City by Grantee provided for in this Franchise shall
apply to all damages and claims for damages of any kind suffered by reason of
any of the Grantee’s operations referred to in this Franchise, regardless of
whether or not such insurance policies shall have been determined to be
applicable to any such damages or claims for damages.

 

5. Grantee’s Insurance.

Grantee shall not commence any Cable System reconstruction work or permit any
subcontractor to commence work until all insurance required under this Franchise
has been obtained. Said insurance shall be maintained in full force and effect
until the expiration of this Franchise.

 

  a. In order for City to assert its rights to be indemnified, defended, and
held harmless, City must, with respect to each claim:

 

  i. Promptly notify Grantee in writing of any claim or legal proceeding which
gives rise to such right;

 

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  ii. Afford Grantee the opportunity to participate in and fully control any
compromise, settlement or other resolution or disposition of any claim or
proceeding; and

 

  iii. Fully cooperate with reasonable requests of Grantee, at Grantee’s
expense, in its participation in, and control, compromise, settlement or
resolution or other disposition of such claim or proceeding subject to
subparagraph (ii) above.

SECTION 9.

SALE, ABANDONMENT, TRANSFER AND REVOCATION OF FRANCHISE

 

1. City’s Right to Revoke.

 

  a. In addition to all other rights which City has pursuant to law or equity,
City reserves the right to commence proceedings to revoke, terminate or cancel
this Franchise, and all rights and privileges pertaining thereto, if it is
determined by City that after notice and an opportunity to cure as reordered
herein;

 

  i. Grantee has violated material provisions(s) of this Franchise and has not
cured; or

 

  ii. Grantee has attempted to evade any of the provisions of the Franchise; or

 

  iii. Grantee has practiced fraud or deceit upon City.

 

  b. City may revoke this Franchise without the hearing otherwise required
herein if Grantee is adjudged a bankrupt.

 

2. Procedures for Revocation.

 

  a. City shall provide Grantee with written notice of a Franchise violation
consistent with Section 8 of this Franchise and shall allow Grantee thirty
(30) days subsequent to receipt of the notice in which to correct the violation
or to provide adequate assurance of performance in compliance with the
Franchise.

 

  b. Should City determine to proceed with a revocation proceeding, Grantee
shall be provided the right to a public hearing affording due process before the
City Council prior to the effective date of revocation. City shall provide
Grantee with written notice of its decision together with written findings of
fact supplementing said decision.

 

  c. Only after the public hearing and upon written notice of the determination
by City to revoke the Franchise may Grantee appeal said decision with an
appropriate state or federal court or agency.

 

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  d. During the appeal period, the Franchise shall remain in full force and
effect unless the term thereof sooner expires or unless continuation of the
Franchise would endanger the health, safety and welfare of any Person or the
public.

 

3. Abandonment of Service. Grantee may not abandon the System or any portion
thereof without having first given three (3) months written notice to City.
Grantee may not abandon the System or any portion thereof without compensating
City for damages resulting from the abandonment, including all costs incident to
removal of the System.

 

4. Removal After Abandonment, Termination or Forfeiture.

 

  a. In the event of termination or forfeiture of the Franchise or abandonment
of the System, City shall have the right to require Grantee to remove all or any
portion of the System from all Rights-of-Way and public property within City.

 

  b. If Grantee has failed to commence removal of System, or such part thereof
as was designated by City, within thirty (30) days after written notice of
City’s demand for removal is given, or if Grantee has failed to complete such
removal within twelve (12) months after written notice of City’s demand for
removal is given, City shall have the right to apply funds secured by the letter
of credit and performance bond toward removal and/or declare all right, title,
and interest to the System to be in City with all rights of ownership including,
but not limited to, the right to operate the System or transfer the System to
another for operation by it.

 

5. Sale or Transfer of Franchise.

 

  a. No sale or transfer of the Franchise, or sale, transfer, or fundamental
corporate change of or in Grantee, including, but not limited to, a fundamental
corporate change in Grantee’s parent corporation or any entity having a
controlling interest in Grantee, the sale of a controlling interest in the
Grantee’s assets, a merger including the merger of a subsidiary and parent
entity, consolidation, or the creation of a subsidiary or affiliate entity,
shall take place until a written request has been filed with City requesting
approval of the sale, transfer, or corporate change and such approval has been
granted or deemed granted; provided, however, that said approval shall not be
required where Grantee grants a security interest in its Franchise and/or assets
to secure an indebtedness.

 

  b. Any sale, transfer, exchange or assignment of stock in Grantee, or
Grantee’s parent corporation or any other entity having a controlling interest
in Grantee, so as to create a new controlling interest therein, shall be subject
to the requirements of this Section 9.5. The term “controlling interest” as used
herein is not limited to majority stock ownership, but includes actual working
control in whatever manner exercised. In any event, as used herein, a new
“controlling interest” shall be deemed to be created upon the acquisition
through any transaction or group of transactions of a legal or beneficial
interest of fifteen percent (15%) or more by one (1) Person. Acquisition by one
(1) Person of an interest of five percent (5%) or more in a single transaction
shall require notice to City.

 

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  c. The Grantee shall file, in addition to all documents, forms and information
required to be filed by Applicable Laws, the following:

 

  i. All contracts, agreements or other documents that constitute the proposed
transaction and all exhibits, attachments, or other documents referred to
therein which are necessary in order to understand the terms thereof; and

 

  ii. A list detailing all documents filed with any state or federal agency
related to the transaction including, but not limited to the FCC, the FTC, the
FEC, the SEC or applicable state departments and agencies. Upon request, Grantee
shall provide City with a complete copy of any such document; and

 

  iii. Any other documents or information related to the transaction as may be
specifically requested by the City.

 

  d. City shall have such time as is permitted by Applicable Laws in which to
review a transfer request.

 

  e. The Grantee shall reimburse City for all the legal, administrative, and
consulting costs and fees associated with City’s review of any request to
transfer. Nothing herein shall prevent Grantee from negotiating partial or
complete payment of such costs and fees by the transferee. Grantee may not
itemize any such reimbursement on Subscriber bills, but may recover such
expenses in its Subscriber rates.

 

  f. In no event shall a sale, transfer, corporate change, or assignment of
ownership or control pursuant to subparagraph (a) or (b) of this section be
approved without the transferee becoming a signatory to this Franchise and
assuming all rights and obligations thereunder, and assuming all other rights
and obligations of the transferor to the City including, but not limited to, any
adequate guarantees or other security instruments required by the City.

 

  g. In the event of any proposed sale, transfer, corporate change, or
assignment pursuant to subparagraph (a) or (b) of this section, City shall have
the right to purchase the System.

 

  h. City shall be deemed to have waived its right to purchase the System
pursuant to this section only in the following circumstances:

 

  i. If City does not indicate to Grantee in writing, within sixty (60) days of
receipt of written notice of a proposed sale, transfer, corporate change, or
assignment as contemplated in Section 9.5 (g) above, its intention to exercise
its right of purchase; or

 

  ii. It approves the assignment or sale of the Franchise as provided within
this section.

 

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  i. No Franchise may be transferred if City determines Grantee is in
noncompliance of the Franchise unless an acceptable compliance program has been
approved by City. The approval of any transfer of ownership pursuant to this
section shall not be deemed to waive any rights of City to subsequently enforce
noncompliance issues relating to this Franchise even if such issues predated the
approval, whether known or unknown to City.

SECTION 10.

PROTECTION OF INDIVIDUAL RIGHTS

 

1. Discriminatory Practices Prohibited. Grantee shall not deny Service, deny
access, or otherwise discriminate against Subscribers or general citizens on the
basis of race, color, religion, national origin, sex, age, status as to public
assistance, affectional preference, or disability. Grantee shall comply at all
times with all other Applicable Laws, and all executive and administrative
orders relating to nondiscrimination.

 

2. Subscriber Privacy.

 

  a. No signals may be transmitted from a Subscriber terminal for purposes of
monitoring individual viewing patterns or practices without the express written
permission of the Subscriber. Such written permission shall be for a limited
period of time not to exceed one (1) year which may be renewed at the option of
the Subscriber. No penalty shall be invoked for a Subscriber’s failure to
provide or renew such authorization. The authorization shall be revocable at any
time by the Subscriber without penalty of any kind whatsoever. Such permission
shall be required for each type or classification of activity planned for the
purpose of monitoring individual viewing patterns or practices.

 

  b. No lists of the names and addresses of Subscribers or any lists that
identify the viewing habits of Subscribers shall be sold or otherwise made
available to any party other than to Grantee or its agents for Grantee’s service
business use or to City for the purpose of Franchise administration, and also to
the Subscriber subject of that information, unless Grantee has received specific
written authorization from the Subscriber to make such data available. Such
written permission shall be for a limited period of time not to exceed one
(1) year which may be renewed at the option of the Subscriber. No penalty shall
be invoked for a Subscriber’s failure to provide or renew such authorization.
The authorization shall be revocable at any time by the Subscriber without
penalty of any kind whatsoever.

 

  c. Written permission from the Subscriber shall not be required for the
conducting of system wide or individually addressed electronic sweeps for the
purpose of verifying System integrity or monitoring for the purpose of billing.
Confidentiality of such information shall be subject to the provision set forth
in subparagraph (b) of this section.

 

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  d. Subscribers and non-Subscribers may request to be put on a list to prevent
solicitations from Grantee.

 

  e. Grantee shall not include any mandatory arbitration provisions of any kind
in any Subscriber contracts.

SECTION 11.

UNAUTHORIZED CONNECTIONS AND MODIFICATIONS

 

1. Unauthorized Connections or Modifications Prohibited. It shall be unlawful
for any firm, Person, group, company, corporation, or governmental body or
agency, without the express consent of the Grantee, to make or possess, or
assist anybody in making or possessing, any unauthorized connection, extension,
or division, whether physically, acoustically, inductively, electronically or
otherwise, with or to any segment of the System or receive Services of the
System without Grantee’s authorization.

 

2. Removal or Destruction Prohibited. It shall be unlawful for any firm, Person,
group, company, or corporation to willfully interfere, tamper, remove, obstruct,
or damage, or assist thereof, any part or segment of the System for any purpose
whatsoever,

 

3. Penalty. Any firm Person, group, company, or corporation found guilty of
violating this section may be fined not less than Twenty and No/100 Dollars
($20.00) and the costs of the action nor more than Five Hundred and No/100
Dollars ($500.00) and the costs of the action for each and every subsequent
offense. Each continuing day of the violation shall be considered a separate
occurrence.

SECTION 12.

MISCELLANEOUS PROVISIONS

 

1. Franchise Renewal. Any renewal of this Franchise shall be performed in
accordance with Applicable Laws. The term of any renewed Franchise shall be
limited to a period not to exceed fifteen (15) years.

 

2. Work Performed by Others. All applicable obligations of this Franchise shall
apply to any subcontractor or others performing any work or services pursuant to
the provisions of this Franchise, however, in no event shall any such
subcontractor or other performing work obtain any rights to maintain and operate
a System or provide Cable Service. Grantee shall provide notice to City of the
name(s) and address(es) of any entity, other than Grantee, which performs
substantial services pursuant to this Franchise.

 

3. Amendment of Franchise Ordinance. Grantee and City may agree, from time to
time, to amend this Franchise. Such written amendments may be made subsequent to
a review session pursuant to Section 7 or at any other time if City and Grantee
agree that such an amendment will be in the public interest or if such an
amendment is required due to changes in federal, state or local laws; provided,
however, nothing herein shall restrict City’s exercise of its police powers.

 

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4. Compliance with Federal, State and Local Laws.

 

  a. If any federal or state law or regulation shall require or permit City or
Grantee to perform any service or act or shall prohibit City or Grantee from
performing any service or act which may be in conflict with the terms of this
Franchise, then as soon as possible following knowledge thereof, either party
shall notify the other of the point in conflict believed to exist between such
law or regulation. Grantee and City shall conform to state and federal laws and
regulations and rules regarding cable communications as they become effective.

 

  b. If any term, condition or provision of this Franchise or the application
thereof to any Person or circumstance shall, to any extent, be held to be
invalid or unenforceable, the remainder hereof and the application of such term,
condition or provision to Persons or circumstances other than those as to whom
it shall be held invalid or unenforceable shall not be affected thereby, and
this Franchise and all the terms, provisions and conditions hereof shall, in all
other respects, continue to be effective and complied with provided the loss of
the invalid or unenforceable clause does not substantially alter the agreement
between the parties. In the event such law, rule or regulation is subsequently
repealed, rescinded, amended or otherwise changed so that the provision which
had been held invalid or modified is no longer in conflict with the law, rules
and regulations then in effect, said provision shall thereupon return to full
force and effect and shall thereafter be binding on Grantee and City.

 

5. Nonenforcement by City. Grantee shall not be relieved of its obligations to
comply with any of the provisions of this Franchise by reason of any failure or
delay of City to enforce prompt compliance. City may only waive its rights
hereunder by expressly so stating in writing. Any such written waiver by City of
a breach or violation of any provision of this Franchise shall not operate as or
be construed to be a waiver of any subsequent breach or violation.

 

6. Rights Cumulative. All rights and remedies given to City by this Franchise or
retained by City herein shall be in addition to and cumulative with any and all
other rights and remedies, existing or implied, now or hereafter available to
City, at law or in equity, and such rights and remedies shall not be exclusive,
but each and every right and remedy specifically given by this Franchise or
otherwise existing or given may be exercised from time to time and as often and
in such order as may be deemed expedient by City and the exercise of one or more
rights or remedies shall not be deemed a waiver of the right to exercise at the
same time or thereafter any other right or remedy.

 

7. Grantee Acknowledgment of Validity of Franchise. Grantee acknowledges that it
has had an opportunity to review the terms and conditions of this Franchise and
that under current law Grantee believes that said terms and conditions are not
unreasonable or arbitrary, and that Grantee believes City has the power to make
the terms and conditions contained in this Franchise.

 

8. Force Majeure. Neither party shall be liable for any failure of performance
hereunder due to causes beyond its reasonable control including but not limited
to; acts of God, fire, explosion, vandalism, storm or other similar
catastrophes; national emergencies; insurrection; riots or wars.

 

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SECTION 13.

PUBLICATION EFFECTIVE DATE; ACCEPTANCE AND EXHIBITS

 

1. Publication, Effective Date. This Franchise shall be published in accordance
with applicable local and state law. The effective date of this Franchise shall
be the date of acceptance by Grantee in accordance with the provisions of
Section 13.2.

 

2. Acceptance.

 

  a. Grantee shall accept this Franchise within thirty (30) days of its
enactment by the City Council, unless the tune for acceptance is extended by
City. Such acceptance by the Grantee shall be deemed the grant of this Franchise
for all purposes; provided, however, this Franchise shall not be effective until
all City ordinance adoption procedures are complied with and all applicable
timelines have run for the adoption of a City ordinance. In the event acceptance
does not take place, or should all ordinance adoption procedures and timelines
not be completed, this Franchise and any and all rights granted hereunder to
Grantee shall be null and void.

 

  b. Upon acceptance of this Franchise, Grantee and City shall be bound by all
the terms and conditions contained herein.

 

  c. Grantee shall accept this Franchise in the following manner:

 

  i. This Franchise will be properly executed and acknowledged by Grantee and
delivered to City.

 

  ii. With its acceptance, Grantee shall also deliver any insurance certificates
as required herein that have not previously been delivered.

Passed and adopted by the City Council this 6th day of November, 2007.

 

ATTEST:     CITY OF MONTGOMERY, ALABAMA By:  

/s/ Brenda Sue Blalock

    By:  

/s/ Bobby Bright

Its:   City Clerk     Its:   May or 11/7/07

ACCEPTED: This Franchise is accepted, and we agree to be bound by its terms and
conditions.

 

35

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    KNOLOGY OF MONTGOMERY, INC. Date: 16th, November 2007     By:  

Illegible

    Its:   SVP Operations

 

SWORN TO BEFORE ME this

16th day of November, 2007.

Cynthia S. Alsabrook

NOTARY PUBLIC

 

36

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EXHIBIT A

OWNERSHIP

 

A-1

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EXHIBIT B

GRANTEE COMMITMENT TO

PEG ACCESS FACILITIES AND EQUIPMENT

 

1. PUBLIC, EDUCATIONAL AND GOVERNMENT (PEG) ACCESS CHANNELS Grantee shall make
two (2) video Channels available exclusively for PEG use (“PEG Channels”).
Initially the two (2) Channels shall be provided by Grantee for shared PEG
access as designated in City’s sole discretion. At least one (1) of the two
(2) shared PEG Channels will be located at Channel 96 throughout the term of the
Franchise. Grantee shall also make available one (1) additional Channel for PEG
use (for a total of three (3) PEG Channels) upon ninety (90) days advance
written notice from the City. One (1) of the three (3) Channels shall, upon
request of the City, be scrambled for City’s exclusive internal use at no cost
to the City. Grantee shall be responsible for all costs associated with said
scrambled Channel. The PEG Channels shall be dedicated for PEG use for the term
of the Franchise, provided that Grantee may upon written request to City,
utilize any PEG Channels for commercial or non-commercial programming when they
are not scheduled for PEG use. City and Grantee shall establish rules and
procedures for such scheduling in accordance with Section 611 of the Cable Act
(47 U.S.C. § 531).

 

2. PEG OPERATIONS. City may, in its sole discretion, negotiate agreements with
neighboring jurisdictions served by the same Cable System, educational
institutions or others to share the expenses of supporting the PEG Channels.

 

3. TITLE TO PEG EQUIPMENT. City shall retain title to any PEG equipment
currently in use for PEG purposes which was purchased by Grantee during the
preceding Franchise term.

 

4. RELOCATION OF PEG CHANNELS. Grantee shall not relocate any PEG access Channel
to a different Channel number unless specifically required by Applicable Laws or
unless otherwise agreed to in writing by City. Grantee shall provide City and
all Subscribers with at least sixty (60) days prior written notice of any
legally required relocation. In the event any PEG access Channel(s) is
relocated, Grantee shall reimburse City up to Fifteen Thousand and No/100
Dollars ($15,000.00) for all costs associated with such move including change of
letterhead, promotion of new Channel location and promotional spots for the new
location and inform Subscribers of the new Channel location through bill inserts
and newspaper advertisements.

 

5.

PROMOTION OF PEG ACCESS. To the extent permitted by Grantee’s billing process,
Grantee shall allow the City to place bill stuffers in Grantee’s Subscriber
statements at a cost to the City not to exceed Grantee’s cost, no less
frequently than once per year upon the written request of the City and at such
times that the placement of such materials would not materially and adversely
effect Grantee’s cost for the production and mailing of such statements. The
City agrees to pay Grantee in advance for the actual cost of such bill stuffers.
Grantee shall also make available PEG access information provided by City in
Subscriber packets at the time of Installation and at the counter in the
System’s business office serving the Service Area. Grantee shall also
distribute, at no charge to City, through advertising insertion equipment,
twenty-five (25) weekly promotional and

 

B-1

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awareness commercial spots, on a “run of schedule” basis, produced at the City’s
cost and submitted by the City in a format compatible with such advertising
insertion equipment once Grantee has acquired and activated such capability.
Grantee shall also include a listing of the known programming to be cablecast on
PEG access Channels in or on any electronic program guide of Services for the
Cable System.

 

6. PEG ACCESS SUPPORT. Grantee shall remit to the City a per Subscriber fee of
twenty-five cents ($0.25) per month to fund capital expenditures related solely
to public, educational and governmental access (hereinafter “Access Fee”). The
Access Fee may be used in City’s sole discretion for PEG capital expenditures.
In year five (5) of the term of this Franchise Grantee may require that the City
undertake a review of the Access Fee to determine whether such fee should be
reduced or eliminated. If so requested the City shall schedule a public hearing
to consider the matter and Grantee shall have an opportunity to be heard at such
hearing. The City Council shall have sole discretion to determine whether any
change to the Access Fee is appropriate. In no event may the Access Fee be
increased to more than twenty-five cents ($0.25). Any and all payments by
Grantee to City in support of PEG access programming including the Access Fee
shall not be deemed “Franchise Fees” within the meaning of Section 622 of the
Cable Act (47 U.S.C. Section 542).

The Grantee may, on an annual basis, upon 60 days written request to City, seek
verification that the Access Fee has been used for capital purchases related to
PEG access. The City shall be permitted to hold all or a portion of the Access
Fee from year to year as a designated fund to permit the City to make large
capital expenditures, if necessary. Moreover, if City chooses to borrow from
itself or a financial institution revenue for large PEG access capital purchases
or capital expenditures, City shall be permitted to make periodic repayments
using the Access Fee. If Grantee believes City has failed to demonstrate
compliance with the expenditure limitations of the Access Fee, Grantee shall
provide City with written notice of its objections. The parties shall thereafter
meet at the reasonable request of either party to address the objections
identified by Grantee. If Grantee reasonably concludes that City has expended
Access Fees in a manner inconsistent with the limitations imposed herein, the
Grantee may, after thirty (30) days written notice to the City, advise the City
of its intention to terminate payment of the Access Fee. If the City disputes
Grantee’s allegation the City may commence a franchise violation proceeding
against Grantee pursuant to the terms of this Franchise . In the event the City
commences a franchise violation proceeding against Grantee, the Grantee shall
continue to collect the Access Fee and hold the disputed monies in a separate
interest bearing account until a final order is issued and any appeals
exhausted. Any monies so held shall be distributed in accordance with any final
order (after exhaustion of any and all appeals) or as City and Grantee might
agree.

 

7. DIGITIZATION OF ANALOG CHANNELS. Grantee may, at its own discretion, move
analog PEG Channels to digital format, if and when all Subscribers who wish to
receive the Channels already have the necessary equipment to view programs in
digital format. Grantee shall enter into good-faith negotiations with the City
over the frequency allocation, Channel assignment and menu placement of new PEG
digital television Channels prior to making such assignments.

 

B-2

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8. DROPS TO DESIGNATED BUILDINGS.

 

  a. Grantee shall provide free of charge throughout the term of this Franchise,
Installation of one (1) network Drop, one (1) cable outlet, and one
(1) Converter, if necessary, and the highest level of Cable Service offered by
Grantee, excluding pay-per-view, pay-per-channel (premium) programming,
high-speed data services or newly created non-video Cable Services, without
charge to the institutions identified on Exhibit C attached hereto and made a
part hereof, and such other public institutions subsequently designated by City
as determined in City’s sole discretion. This requirement shall not include any
digital tier of Services Grantee may offer unless and until such time as
Grantee’s digital programming reduces the amount of spectrum available for
analog programming to less than approximately sixty (60) Channels of analog
programming. Grantee shall be responsible for the costs of extension to
subsequently designated institutions for the first five hundred (500) feet as
measured from Grantee’s nearest active plant. The institution shall pay the net
additional Drop or extension costs beyond the five hundred (500) feet.

 

  b. In the event Grantee provides cable modem service in the City and passes a
location not already receiving cable and cable modem service, Grantee shall
provide the public schools (K-12) and the library (and its branches) with free
cable modem, free Installation and free monthly cable modem/high-speed data
service throughout the term of this Franchise.

 

  c. Additional Subscriber network Drops and/or outlets in any of the locations
identified on Exhibit C will be installed by Grantee at the lowest actual cost
of Grantee’s time and material. Alternatively, said institutions may add outlets
at their own expense, as long as such Installation meets Grantee’s standards and
approval which shall not be unreasonably withheld. Grantee shall have three
(3) months from the date of City designation of additional accredited schools or
public institutions or relocations to complete construction of the Drop and the
outlet unless weather or other conditions beyond the control of Grantee requires
more time.

 

9. LIVE BROADCAST FACILITIES AND TWO-WAY NETWORK.

 

  a. Grantee shall, at no cost to City unless otherwise specified herein,
provide a return connection to facilitate the exchange of programming, including
live cablecasting of programming from those locations identified in Exhibit D,
attached hereto and made a part hereof.

 

  b. The City and Grantee agree that Grantee shall, on or before April 1, 2008,
complete all construction work to facilitate a fiber path for live cablecasting
from the City Hall to Grantee’s headend.

 

B-3

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EXHIBIT C

SERVICE TO PUBLIC AND PRIVATE BUILDINGS

 

1. Woodcrest Park Community Center (off Thornwood Dr)

2. Intermodal Facility (Molton Street)

3. Fire Department Training Facility (North Court Street)

4. Gateway Park Lodge

 

** Other Buildings owned by the City of Montgomery that are newly constructed or
newly purchased subsequent to the effective date of the franchise that are
within 300 feet of the Knology cable system

 

C-1

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EXHIBIT D

ADDITIONAL TWO-WAY CONNECTIONS TO PUBLIC INSTITUTIONS

 

1. From Cramton Bowl to Troy University (Studio facility)

2. From Lagoon Park to established City owned fiber network

3. From Gateway Park to established City owned fiber network

4. From Museum of Fine Arts to established City owned fiber network

5. From City Fire Stations to established City owned fiber network

 

D-1

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EXHIBIT E

DESCRIPTION OF SYSTEM

 

1. The Cable System shall be designed, constructed, routinely inspected, and
maintained to guaranty the Cable System meets or exceeds the requirements of the
most current additions of the National Electrical Code (NFPA 70) and the
National Electrical Safety Code (ANSI C2). In all matters requiring
interpretation of either of these codes, the City’s interpretation shall control
over all other sources and interpretations.

 

2. General Requirements. Grantee shall use equipment used in high-quality,
reliable, modern Cable Systems of similar design.

 

3. General Description. The Cable System shall provide Subscribers with a
technically advanced and reliable Cable System. The System shall operate with
750 MHz of bandwidth, capable of delivering a minimum of seventy-five
(75) Channels of programming. The design will provide the benefits of proven
seventy-five (75) Channel electronics while positioning the System for expansion
of bandwidth and Channel capacity as technology and future services develop.

 

4. Technical Specifications. The System shall meet or exceed FCC requirements.
In no event shall the System fall below the following standards:

 

  a. The System shall be capable of meeting the following distortion parameters:

 

1.    Carrier to RMS Noise    48 dB    2.    Carrier to Second Order    53 dB   
3.    Carrier to Cross Modulation    51 dB    4.    Carrier to Composite Triple
Beat    53 dB   

 

  b. The frequency response of a single Channel as measured across any 6 MHz
analog Channel shall not exceed +/- 2 dB.

 

  c. The frequency response of the entire passband shall not exceed N/10+ 2 dB
for the entire System where N is the number of amplifiers in cascade.

 

  d. The System shall be designed such that at a minimum all technical
specifications of this Franchise Agreement are met.

 

  e. The System shall be designed such that no noticeable degradation in signal
quality will appear at the Subscriber terminal.

 

E-1

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EXHIBIT F

FRANCHISE FEE PAYMENT WORKSHEET

TRADE SECRET – CONFIDENTIAL

 

    

Month/Year

  

Month/Year

  

Month/Year

  

Total

Basic Cable Service

           

Installation Charge

           

Bulk Revenue

           

Expanded Basic Service

           

Pay Service

           

Pay-per-view

           

Guide Revenue

           

Franchise Fee Revenue

           

Advertising Revenue

           

Home Shopping Revenue

           

Digital Services

           

Inside Wiring

           

Other Revenue

           

Equipment Rental

           

Processing Fees

           

Bad Debt

           

REVENUE

           

Fee Calculated

           

Fee Factor: 5%

 

F-1