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HomeMy WebLinkAboutAgenda - 11-02-2005-5dORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: November 2, 2005 Action AgeS~ Item No. SUBJECT: First Reading -Ordinance Granting Franchise to Time Warner Entertainment/Advance-Newhouse Partnership, to Own, Operate, and Maintain Cable System in Unincorporated Orange County DEPARTMENT: County Manager PUBLIC HEARING: (Y/N) No ATTACHMENT(S): A. Chapel Hill Franchise Agreement Excerpt B. Proposed (Negotiated) Cable Television Franchise Ordinance/ Agreement INFORMATION CONTACT: Michael Patrick, Chair, Cable Advisory Committee Gwen Harvey, Assistant County Manager, 245-2307 PURPOSE: To consider approval of the first reading of a cable franchise renewal ordinance (agreement) with Time Warner Entertainment/Advance-Newhouse Partnership (TWC), as recommended by the Orange County Cable Advisory Committee. BACKGROUND: In the fall of 2003, the Cable Advisory Committee, Triangle J Cable Consultant, and County staff brought forward a proposed cable television franchise ordinance/agreement that was adopted by the BOCC after a second reading. TWC officials challenged the ordinance/agreement and declined to sign, calling upon the BOCC to re- establish informal negotiations and allow further opportunity to reconcile remaining differences, The BOCC granted this request and authorized staff to retain the services of Andy Sachs of the Dispute Settlement Center to facilitate new negotiation sessions. TWC and the County shared equally in the cost of facilitation services, A series of facilitated sessions were conducted between June 2004 and August 2005. The negotiating team was comprised of: (TWC) Brad Phillips, Vice President/Governmentand Public Affairs; Andi Curtis, Assistant to the VP/GPA; Trish McCausland, Assistant Chief Counsel, Regulatory; and (County) Cable Advisory Committee Chair Michael Patrick and Assistant County Manager Gwen Harvey. Additional County staff -Legal, Finance, Purchasing, Clerk's Office -provided technical support and guidance as needed throughout the process, along with the entire Cable Advisory Committee and Bob Sepe, Action Audits, LLC. Commissioner Steve Halkiotis is the current BOCC liaison to the Cable Advisory Committee, BOCC Questions A preliminary report and preview of the proposed Franchise Ordinance/Agreement was provided to the BOCC at the meeting on September 7~", In response to questions raised by the BOCC at that time: The Cable Advisory Committee Chair and County staff met with TWC and The People's Channel (TPC) representatives on October 5 to clarify concerns about the technical equipment (Exhibit A of the Franchise Ordinance/Agreement) needed to livecast BOCC meetings from both meeting facilities, Minor modifications within the project scope remain under evaluation by TWC and should be confirmed by the second reading, County staff will continue to work with both TWC and The People's Channel on preparations for "going live" with the broadcast of BOCC meetings and other implementation measures, In a presentation before the BOCC at the work session on October 17, Corley Redfoot Zack, the architects for the expanded Justice Facilities, indicated that no change is being recommended for the F. Gordon Battle Courtroom where the BOCC presently meets, County staff retains the ability to postpone outfitting the F. Gordon Battle Courtroom for livecasting should the BOCG state its preference for outfitting a different space in the expanded facility for its public meetings in the future, Close communication will be maintained with Pam Jones, Central Services/Purchasing, and the Justice Facilities workgroup in this regard. • Exhibit B of the Franchise Ordinance/Agreement has been amended to include the Northern Human Services Center at Cedar Grove. Free Basic Cable Services for the Chapel Hill-Carrboro City Schools District is covered under the Chapel Hill cable franchise ordinance, See excerpt Attachment A, The Carrboro Board of Aldermen and the BOCC typically meet on the same night and time of the month, and the town airs its Board meetings on existing cable channel 18. Under the proposed Franchise Ordinance/Agreement, cable subscribers in Carrboro would have the ability to watch either the Town Board meeting on cable channel 18 or the BOCC meeting on a channel to be determined on the cable digital tier, or both by utilizing the split screen feature on their television. Subscribers throughout the County, regardless of township, will be able to request a free digital converter box in order to receive the County transmission signal if they presently do not have one, The proposed Cable Franchise Ordinance/Agreement in Attachment B represents the "best effort" of both parties to address key objectives within a "good faith" negotiation process as authorized by the BOCC, County staff and TWG officials recommend that the BOCC accept ahd approve the proposed 15-year agreement. The Cable Advisory Committee met on October 5 and discussed the proposed Ordinance/Agreement. It voted unanimously to recommended approval by the BOCC. While not a formal member of the negotiation team, Bob Sepe, Triangle J COG Cable Consortium consultant has advised the County on technical matters as needed. He attended the CAC meeting and expressed his opinion that the proposal represented "a very~ood deal" for the County. Upon execution of an approved Franchise Ordinance/Agreement, TWC expects to extend cable television services for news, weather and information to the Government Services Center that would enable the County to discontinue its contract for satellite services,. Highlights of the Proposed Franchise Ordinance/Agreement Requires the grantee to extend services to any household where the number of occupied homes, and homes for which certificates of occupancy been issued, equals at least 18 homes per street mile. TWC had objected to this density level under the proposed 2003 ordinance/agreement. Differences have been resolved and agreement reached to a density of 18 households per street mile. Requires the grantee to designate a PEG (Public, Educational, Government) access channel for sole use by the County for live and recorded telecasts of Board meetings and other government access programming. PEG access was another area of contention under the 2003 ordinance/agreement. TWC has agreed to provide the County with a digital channel on the cable system for PEG access. Cable subscribers without the digital tier will be provided, upon request, with a free digital box to enable them to view programming on the County access channel. Requires the grantee to design and install a system of equipment that would provide signal transportation for County Board meeting telecasts on a designated PEG channel that originate from Southern Human Services Center or the F. Gordon Battle Courtroom. The BOCC has held a longstanding interest in the "capitalization" of County facilities used for public meetings, particularly those of the legislative process. TWC has now agreed to purchase and install the requisite capital equipment (cameras, monitors, scan converters, switchers, recorders, etc.) to allow for livecasting of BOCC meetings from both locations at its up-front expense. These capital improvements should bring greater efficiency and enhanced quality of output to the current process under contract with The People's Channel. Staff contemplate that TPG would continue on as principal operator of these facilities on behalf of the BOCC. Upon implementation of the proposed Franchise Ordinance/Agreement, cable subscribers in unincorporated Orange would see a "surcharge" on their monthly cable bill, consistent with FCC rules, so that TWC can recover its capital investment over a period of 10 years. Preliminary estimates indicate an annual cost per subscriber of roughly 25 cents per month. Next Steams If approved at first reading, this item would return for the required second reading and adoption as recommended by the Cable Advisory Committee at the BOCC meeting on November 15. FINANCIAL IMPACT: Cable franchise revenues are calculated as an "annual fee of five percent (5%) of the grantee's grass revenues". In Fiscal 2004-2005, Orange County received a total of $247,065 in franchise fees from Time Warner Cable. Under the proposed Franchise Ordinance/Agreement, cable subscribers in unincorporated Orange County would see a small surcharge on their monthly cable bill in order to amortize the TWC debt far installation of capital equipment necessary for signal transmission from the two BOCC meeting locations over a period of ten years. RECOMMENDATION(S): The Manager recommends that the BOCC consider approval of the first reading of the proposed Cable Television Franchise Ordinance/Amendment EXI-IIBIT G 1. Public buildings to be provided with free cable TV connections and highest level of basic service: a. Town of Chapel Hill buildings: Town Hall Police Headquazters, Airport Road Fire Headquarters Fire Station 2 (Hamilton Road in Glen Lennox) Fire Station 3 (Elliott Road and East Franklin) Fire Station 4 (Weaver Dairy Road and Airport Road) Public Housing administration office, Caldwell Street Extension * Plant Road Parks and Recreation Offices * Community Center, South Estes Drive Hazgraves Center, Roberson Street * Lincoln Arts Center, Merritt Mill Road * Old Chapel Hill Public Library, Franklin and Boundary Streets * New Library * East Rosemary Sfreet pazking deck * Old Town Hall (Rosemary and Columbia) * Post Office/District Court Building (East Franklin Street) All buildings acquired, built, relocated or leased by the Town during future yeazs of the franchise and passed by cable Town facilities requiring more than 125 feet of service drop and passed by cable * Public Works Operating Center, Airport Road * Transportation Operations/Administration Center, Airport Road * Umstead Center, Umstead Drive b. City Schools Administration/Lincoln Center, Merritt Mill Road Seawell Elementary, Seawell Road Ephesus Road Elementary, Ephesus Church Road Glenwood Elementary, Prestwick Road (in Glen Lennox area) Estes Hills Elementary, Estes Drive Frank Porter Graham Elementary, Fordham Blvd. and Smith Level Road Phillips Middle School, Estes Road Culbreth Middle School, Culbreth Road Chapel Hill High School, High School Road * Cultural Arts Center, High School Road * East Chapel Hill High School, Weaver Dairy Road All buildings acquired, built, relocated or leased by the City Schools during future years of the franchise and passed by cable * does not have cable service as of effective date of Franchise G-2 2, The Grantor may designate locations as provided above from which access programm;ng may be originated and provided to Grantee for distribution on the designated access channel(s), subject to the following conditions: (a) There may be one origination location for each access channel, /Ki~i~S/CI4i~ORD17'R~AMCH-FRORD. WI'D ~o (b) Grantee shall not be obligated to extend its facilities more than 125 feet to reach t$e origination location, ox furnish any internal wiring, modulator(s) or associated equipment. (e) A change in origination location may be requested by the Grantor upon giving 120 days' written notice, approval of which shall not be unreasonably withheld. (d) Grantee shall be entitled to recover any of its costa associated with the provision of public, educational and government access services and facilities as pernutted by Federal law. G-3 /KWSJC{WORD{TVV&AJV{CH-FRORD. WPD tTZ:~c{,~,-~- STATE OF NORTH CAROLINA ORANGE COUNTY ORDINANCE 2005 - ~o~ ~'~~, CABLE TELEVISION FRANCHISE 7 An Ordinance granting a Franchise to Time Warner Entertainment-Advance/Newhouse Partnership, a New Yor°Ic general partnership (the "Grantee") to own, operate and maintain a Cable System in Orange County, North Carolina, WHEREAS, Orange County, (the "Grantor"), desires to asstrre the widespread availability of Cable Services within the County; WHEREAS, the Grantor has, following reasonable notice, and after consideration, analysis and deliberation conduc,Ced public proceedings, during which proceedings the technical ability, financial condition, legal qualificatiort and general character of the Gra~~tee were determined acceptable to receive a renewal of its Fr°anchise; WHEREAS, the Grantor also has considered and analyzed the plans of the Grantee for the construction and operation of its Cable System and fotmd the same to be adequate and feasible in view of the needs and requirements of the area to he served by the Cable System; WHEREAS, the Grantor has determined that it is in the best interest of and consistent with the public convenience and necessity of its residents to grant a Franchise to the Grantee to operate a Cable System within the County on the terms and conditions hereinafter set forth; and WHEREAS, the Grantee desires to operate a Cable System consisting of fiber optic and coaxial cables along state and private right-of=way within the Grantor°'s jurisdiction. NOW, THEREFORE, the parties agree as follows: Section 1. Nature and Terms of Grant A. The Grantor hereby grants the Grantee a County-wide Franchise to construct and operate a Cable System, using owned and/or leased facilities, which may be located in state or private Rights-of Way within its,jurisdiction. B. Notwithstanding Section lA, the Grantee may, in its sole discretion, elect to lease fiber optic and coaxial cable and other cable conununication facilities from other conrrnunication compatries to support the operation of its Cable System. C. The Franchise gr°anted herein is for a terns of fifteen (15) years from the effective date, of this Franchise, which shall be the date of acceptance by the Grantee of the Franchise teens, and conditions as set forth in Section 39. Section 2. Definitimrs For the purposes of this Franchise, the following teens, pleases, words, and abbreviations shall have the following meanings. Words used in the present tense include the firture tense, words in the plural include the singular, and words in a particular gender shall. include the other gender. The words `"shall" and "must" are always mandatory and not merely directory. A. "Access or Public, Education or Government Access" shall mean the availability of chamrel capacity on the Cable System for non-commercial public, education or government use by agencies, institutions, organizations, groups and individuals in the community, including the Grantor and its designees for the distribution of non- conmlercial programming not under the Grantee's editorial control and consistent with applicable law. B. "Affiliate", when used in relation to any Grantee, shall mean another person who owns or controls, is owned or controlled by, or is tinder conunon ownership or control with, Grantee. C. "Basic Cable Service" or "Basic Service" shall mean any cable service ties; that includes the retransmission of local television broadcast signals. This defnition shall be deemed to change consistent with any changes in the definition of this term by the Federal Communications Conunission. D. "County Board" shall mean the Board of County Conunissioners of Orange County, North Carolina. E. "Cable Operator" shall mean any person or group of persons who: 1. provide Cable Service over a Cable System and directly or through one or more afFliates owns a significant interest in such Cable System, or 2. otherwise control or ue responsible for, tluough any arrangement, the management and operation of such a Cable System under a Franchise with the Grantor. F. "Cable Service" shall mean: 1. The transmission Yo Customers of (i) video pr~ogr'anmring, or (ii) other programming service, and 2. Customer interaction, if any, which is required for the selection or use of such video progranuning or other programming services. G. "Cable System" shall mean a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and conrirol equipment that is designed to provide Cable Service to nnrltiple Customers within a conununity, but such term does not include: 1. A facility that serves only to reh°az~smit the television signals of one (1) or more television broadcast stations; 2. A facility that serves Customers without using any Public Rights-of--Way; 3 A facility of a common carrier which is subject, in whole or in part, to the provisions of 47 U.S.C, §201-226, 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 a facility is used in the transmission of video pr~ograrmning directly to Customers; and 4. Any facilities of an electric utility used solely for operating its electric utility system. H. "Channel" shall mean a portion of fire electromagnetic frequency spectrum, which is capable of delivering both the audio and video portions of a television signal. Such capability generally requires a bandwidth of 6 MHz.. I "County" shall mean Orange Comity. J. "Customer" shall mean any person or entity lawfully receiving Cable Service from the Grantee pursuant to this Fr°ai7cbise. K. "Customer Service Standards" shall mean those standards adopted by the FCC, which govern the mamier iu which the Grantee interacts with the public and its customers. L ">Jducation Access" shall mean nonconunercial access where local schools are the designated progrannners having editorial control over their prograrmning, wlrich shall concern their educational functions. M. "I+CC" shall mean the Federal Conununications Conunission. N. "Franchise" shall mean an initial authorization, or renewal thereof, (including a renewal of an authorization which has been granted subject to 47 U.S.C. §546), issued by the Grantor, whether such authorization is designated as a Franchise, Ordinance, permit, license, resolution, contract, certificate, agreement, or otherwise, which authorizes the construction or operation of a Cable System. 3 to O. "Franchise Fee" shall mean an amoral fee of fve percent (5%) of the Grantee's Gross Revenues paid for Grantor's authorization to construct and operate a Cable System within its jur°isdiction. P. "Government Access" shall mean noncommercial access where government institutions or their designees are the primary or° designated programmers or users having editorial control over their° programming, which shall concern their goverunerrtal functions. Q. "Grantee" or "Franchisee" or "Company" shall mean the person, firm, or corporation to whom a Franchise, as hereinabove defined, is granted by the Grantor and any lawfirl successor, transferee or assignee of said person, firm, or corporation. R. "Gross Revenues" shall mean all revenue received by the Grantee, which is derived fiom the operation of the Cable System to prrovide Cable Service which includes but is not limited to: fees charged to Customers for Basic Cable Service; fees charged to Customers for an optional video or audio service; fees charged to Customers for any tier of video or audio program service other than Basic Cable Service; installation, discomieetion and re-connection fees for the provision of video or audio program services; leased Channel fees; and equipment rentals and revenues. Gross Revenues shall also include an allocated portion of revenues received by the Grantee For the carriage of home shopping channels on the Cable System; marketing, launch and carriage revenues, which exceed reimbursement for expenses; and revenues from advertising on the Cable System sold by the Grantee or its agents. The allocation shall be a percentage of such revenues determined by dividing the number of Customers in the Grantor's Franchise area by the total number Customers served by the Cable System. This sum shall be the basis for computing the fee imposed pursuant to Section 8A hereof The term "Gross Revenues" shall not include: converfee or other equipment deposits; bad debts; any sales, excise or any other taxes collected by the Grantee on behalf of any state, city or other govenmrental unit; Franchise Fees; refunds to Customers by the Grantee; reimbursement for expenses (including late fees, returned check fees, copy expenses and similar items); or items excluded by local, state or federal law.. Gross Revenues shall be computed in accordance with Generally Accepted Accounting Principles ("GAAP"). S. "Initial Service Area" shall mean that geographical area within the unincorporated portions of the County as it exists on the date of acceptance by the Grantee. T. "Institutional Network" m• "I-Net" shall mean capacity on the Cable System used for- the provision of services to the Grantor pursuant to the temis and conditions set forth in Section 15. 4 U. "Other- Communications Services" shall mean any lawful service other than Cable Service that Cable Operator makes available for purchase. V. "PRG Access" shall mean Public Access, Education Access and Government Access, collectively,. W. "Person" shall mean an individual, partnership, limited partnership association, limited liability company, joint stock company, trust, corporation, or govermnental entity; X. "Public Access" shall mean access where organizations, groups, or individual members of the general public are the designated progr°anuners having editorial control over their° progranuning pursuant to rules promulgated by the Grantor; Y. "Public Buildings" shall mean public K-12 schools, and buildings owned or leased by the County for governmental use. Z. "Public, Education, or Government Access Facilities" shall mean: 1, Chamrel capacity designated for PEG Access use; and 2. Equipment used for PEG Access. AA. "Public Rights-of--Way and Rights-of-Way" shall include the surface, the air space above the surface, and the area below the surface of any public street, avenue, highway, lane, path, alley, sidewalk, boulevard, drive, bridge, tumrel, park, parkway, square, viaduct, waterway, greenway, utility easement, acid other public property now or hereafter held by the state which shall entitle the Grantee to the use thereof for the purpose of installing and maintaining the Grantee's Cable System. BB. "Reasonable Notice" shall mean fourteen (14) calendar days for all non-financial related matters and thirty (30) calendar days for financial matters, unless otherwise specifically defined herein. CC. "Residential Customer" shall mean a Customer who lawfully receives Cable Service in an individual dwelling unit or multiple unit dwelling, where the service is not to be used in cormection with a business, trade or profession. DD "Service Tier" shall mean a category of Cable Service provided by a Cable Operator and for which a separate rate is charged by the Cable Operator.. EE. "Year" shall mean a calendar year. Sectimr 3. System Capacity 5 ~a Grantee's Cable System is a 750 MHz hybrid fiber coaxial, two way capable system. Grantee shall install and maintain the Cable System in accordance with industry standards and shall upgrade the Cable System to meet its business ol?jectives, Section 4. Service Area The Grantee's Service Area shall consist of the unincorporated areas located within the County as may be amended from time to time as the result of amiexation of territory by incorporated municipalities located within the County. Section 5. Cable System Service Area );xtension A The Grantee shall extend service within the County to any household where the number of occupied homes, and homes for which certificates of occupancy have been issued equals at least eighteen (18) homes per mile with the measurement starting from the closest usable active point on the Cable System. The Grantee shall apply for all necessary permits within ninety (90) days of confrmation that the required density is met. Such extensions shall be completed within six (6) months of notification and receipt of all necessary utility permits and other right of way permits. The Grantor may apprrove additional time suUject to a written request by the Grantee that delineates the case for additional time. B. If the number of households per mile is less than eighteen (18), the requesting Customers(s) may obtain service by paying a share of the incremental cost of the extension as follows: The Grantee shall pay a share of costs calculated as the fraction derived from the existing density as calculated above divided by eighteen (18) homes per mile; requesting Customer(s)' share shall equal the r°emainder, For example, if the line extension density is nine (9) homes per mile, the Grantee shall pay fifty percent (50%) of the extension cost and the requesting Customer(s) shall pay the remaining fifty percent (50%). C. Upon receipt of a written request for a Cable Service extension from the Grantor, the Grantee shall, within thirty (30) days, respond in writing with its calculation of the density- If the density is less than eighteen (18) homes per mile, the Grantee shall also provide a f rm price good for ninety (90) days reflecting the proportional share which requesting resident(s) must pay on a cost sharing basis to obtain Cable Service, Wiflrin ninety (90) days from payment of the cost share by prospective Customer(s) and receipt of all necessary utility permits or other Right-of--Way permits, the Grantee shall complete the extension of Cable Service. D. As the household density increases in an area where service is extended on a cost sharing basis, the Grantee shall, upon request, annually refiutd a proportionate share of the Customer(s)' contributions commensurate with the increase in C l3 density. Such refunds shall not be due to requesting parties after two (2) years from the date of completion of a Cable Service extension.. Section 6. Customer Service Standards A Grantee agrees to operate its Cable System in a mamier consistent with the FCC Customer Service Standards. B. When calling in person on Customers or other residents, all employees or authorized representatives of the Grantee are required to display an employee identification card with their name artd photograph that can be used for verification of the representative's relationship with the Grantee. The Grantee's vehicles shall display the name or identity of the cable company. The Grantee shall make a reasonable effort to cause its subcontractors' vehicles to be identified in a like fashion. C. The Grantee shall be responsible for adopting and implementing Customer complainC procedures, and for advising Customers of the availability of these procedures. The procedures shall be designed to resolve Customer complaints in a timely satisfactory manner; to develop sensitivity and responsiveness to Customer needs by the Grantee and its management; and to improve the quality and dependability of services to Customers by the Grantee. D. The Grantee shall render efficient service, make r°epairs prromptly and interrupt service only for' good cause and for the sbor'test time possible. Franchise wide planned interruptions not within the midnight to 6:00 A.M. period, insofar as possible, shall be preceded by notice to Customers. E. Grantee shall upon customer request credit the Customer's accounts for verifiable outages within its control of twenty-four (24) hours or' more for the levels of service affected by such outage. Credits for outages will be issued no later than the Customers next billing cycle following the determination that a credit is warranted. Section 7. Customer Privacy In accordance with 47 U.S.C. § 551, the Grantee shall, no less than aruwally, provide a privacy notice in the form of a separ°ate written statement to Customers as required by the provisions of the Act. Section 8. Compensation, Auditing and Other Payments A The Grarttee shall pay the Grantor throughout the term of this Franchise, as compensation, an annual Franchise Fee of five percent (5%) of the Grantee's Gross Revenues. 7 ~~' B. The Grantee, on an annual Uasis, shall furnish Hre Grantor a statement within ninety (90) days of the close of the calendar year, certified Uy an official of the Grantee responsible for the Cable System's financial statements, reflecting the total amounts of Gross Revenues, and all pa}nnents, and computations for the previous calendar year. Upon ten (10) calendar days prior written notice, the Grantor shall have the right to conduct an independent audit of the Grantee's records for the most recent sixty (60) months to determine whether proper Franchise Fees have been paid. If, after resolving any dispute arising from such audit, the Grantee has made a Franchise Fee underpayment of tluee percent (3.0%) or mor°e, the Grantee shall reimburse the Grantor- for all reasonable costs actually expended in conducting any such audit. In other events, the Grantor shall Uear all costs and fees, associated with any such audit, C. All of the Grantee's Uooks and records concerning its Gross Revenues and its calculation of payments to the Grantor; shall be availaUle for inspection Uy an appropriate officer of the Grantor, or its designee, at reasonable times to determine the amount of compensation due to the Grantor from the Grantee under this Franchise. Such records shall Ue kept so as to accurately show the same, The Grantee shall prepare and make available to the Grantor at times reasonably requested by the Grantor and in the form prescribed by the Grantor after consultation with the Grantee, such reports with respect to its Cable System, and the Gross Revenues derived there fiom, as the Grantor may deem reasonably necessary or appropriate. D. hr the event the Grantee makes an underpa}mrent or in the event the Grantee fails to make any paytnent on or Uefore the date it is due, the Grantee shall pay interest at a rate of one percent (1%) per month on any such under payment and/or late payment. E. Consistent with federal requirements, the Grantee shall file no Less frequently than amrually any tariffs, amendments, or modifications affecting the sale of its services and Customer terminal equipment and shall provide written notifcation to Hie Grantor within thirty (30) days of any proposed changes. The Grantee shall provide notice to the Grantor of all filings, reports and petitions to local, state, or federal regulatory agencies concerning the Franchise, which are required by 47 CFR § 76.1700 of the FCC's rules to be maintained in flee Grantee's public inspection file. Upon request, the Grantee shall provide copies of said filings to the Grantor. Section 9. Franchise -Not Exclusive A. This Franchise is not exclusive. The Grantor reserves the right to grant Franchises to other persons, as well as the right in its own name, to operate a Cable System for similar or different purposes allowed the Grantee hereunder. 8 ~5 B. The material teens, provisions and conditions of any Frauclrise granted to third parties by the Grantor shall conform with federal and state law related to cable television and shall be non-discriminatory, Material ternis, provisions and conditions shall include at a minimum, those relating to Franchise Fees, PEG Access support in any form or mamter provided, the provision of hlstitutional Networks, liquidated damages, insurance, bonds, letters of credit and similar instnmients, reports, Customer Service Standards, computation of Gross Revenues, service area, service to public buildings, build out r-equirements, Rights-of--Way use cmrditions and inspection requirements. Construction may be phased in over a reasonable period of time pursuant to federal law. Section 10. No-Waiver A. The failure of the Grantor or the Grantee, upon one or more occasions, to exercise a right or to require compliance or performance under this Franchise or any applicable law shall not be deemed to constitute a waiver of such sight or a waiver of compliance or performance, unless such right has been specifically waived in writing. B. Waiver of a particular breach of this Franchise shall not be construed as a waiver of any other breach. No pr°ovision of Phis Franchise shall operate as a waiver by the Grantor or the Grantee of any right guaranteed by the federal or state constitutions or other applicable law. Section 11. Regulation A The Grantor shall be vested with the power and authority to reasonably regulate the exercise of the privileges permitted by this Franchise in the public interest. Any failure by the Grantor to promptly enforce compliance with this Franchise in accordance with federal, state and local laws and ordinances shall not relieve the Grantee of its obligation to comply with any provision of this Franchise. B The Grantee's rights, pursuant to the Conununications Act of 1934, as amended, the U.S. Constitution, the Constitution and laws of North Carolina, or any other subsequently adopted federal or state law, shall not be abrogated or otherwise Limited by the Grantor. C_ Following Reasonable Notice, the Grantor° reserves the right to inspect the installation and maintenance of the Cable System. D. The Grantee shall comply with all current federal and state regulations, applicable to its Cable System, such as the National Electrical Code and National Electrical Safety Code and generally applicable nondiscriminatory local regulations such as traffic safety/lane closure rules and construction requirements promulgated by the Grantor. 9 ~~o Section 12. Public Rights-of--Way Use Conditions A. The Grantor reserves the right, upon Reasonable Notice, to require the Grantee at its expense to protect, support, temporarily disconnect, relocate or' remove from the Public Rights-of--Way any property of the Grantee by reason of traffic conditions, public safety, sheet construction or excavation, change or establislunent of street grade, installation of sewers, drains, water pipes, power or communication lines, or other types of structure or improvements by governmental agencies for governmental purposes. Reasonable Notice for purposes of this Section shall be construed to mean at least ninety (90) days, except in the case of emergencies where no specific notice period shall be required. Tlie Grantor shall endeavor to notify and seek continent fiom the Grantee, with respect to minimizing disruption to the Cable System, where public works projects may affect the Grantee's Cable System. In the event Grantor reimburses any other user of the right of way for' such relocation, Grantee shall be similarly reimbursed. B The Grantee shall relocate its facilities and appliances that are in conflict with County or state projects to upgrade or construct roadways, or other public infrastructure in accordance with the governing law regarding reimbursement of such expenses by the state,. C. Whenever a Public Right-of-Way exists to acconnnodate the Grantee's Cable system, the Grantee shall make every effort to locate its facilities, other than Customer drops, within the Grantor's Rights-of--Way, unless there are legitimate legal, technical, operational, or economic reasons to do otherwise. D. The Grantee shall adhere to all federal, state and generally applicable nondiseriminator~y local regulations regarding the location, construction, and maintenance of its facilities within the Public Rights-of--Way. The Grantee shall take reasonable preventative measures to protect existing facilities within the Public Rights-of-Way, L. The Grantee shall r°estore and replace landscaped areas within the Public Right-of Way, pavement, pedestrian lighting, sidewall<s, curbs, gutters or other facilities damaged by the Grantee or its contractors with like material to their former condition at the Grantee's expense, and shall thereafter, from time to time, but no longer than one (I) year from the completion of the job, readjust, fill and finish the same as may be necessary due to settling of the earCh associated with the Grantee's disruption of the Public Rights-of--Way. Section 1:3. Initial and Continuing Tests A. The Grantee, shall perform all tests necessary to demonstrate compliance with the requirements of 47 C.F.R §76, subpart IC All tests shall be conducted in accordance with the FCC's rules at the Grantee's expense. 10 ~~ B. Upon request, the Grantor shall be provided maps designating the location of Grantees cable plant (strand) in the Public Rights-of--Way. Such maps should designate the location of the Grantee's facilities in a nnrtually acceptable form. Section 14. Public, Education and Government Access Provisions A. The Grantee shall provide the County with a digital charnel on the Cable System for PEG access use.. In addition, the Grantee shall continue to provide the PEG access chamlels currently cablecast in neighboring conununities for so long as such charnels are cablecast in neighboring communities located in the County.. hz order to allow access to the County PEG channel, the Grantee shall make available a digital box without charge to those customers who do not have a digital box and who specifically request the box in order to view the access prograznming available on the digital charnel. Said box shall permit the viewing of the PEG progranuning on the digital access chamrel. If a customer who has obtained a free digital box under this provision later wishes to order an additional service that requires use of the box, the Grantee may charge the customer its regular service fees for use of the box. B. The Grantee shall provide return feed capability from the: Southern Human Services Center at 2501 Homestead Road, Chapel Hill, NC and the 2. F. Gordon Battle Courtroom, Orange County New Courthouse at 106 East Margaret Lane, Hillsborough, NC. C. To facilitate coverage of county meetings, Grantee shall install the equipment outlined in Exhibit A at the above-referenced locations. If any equipment set forth in Exhibit A becomes not reasonably usable due to normal wear and tear, Grantee agrees to replace it, with comparable new equipment. Grantor shall be responsible for ongoing repair and maintenance of the equipment and Grantee shall have no obligation to replace equipment that has not been maintained in accordance with manufacturer specifications as evidenced by maintenance records or that has been damaged or stolen. D. Programs telecast on the PEG Access chamrels shall be locally produced and nonconunercial in nature. Program material to be distributed on PEG Access ehamrels shall contain no advertising or cormnercial content for which consideration of any kind is received directly or indirectly by the Grantor or by the producer or distributor of a program. The Grantor may not enter into a lease, license, contract or arrangement of any kind whereby the Grantor or its desib iee allows or requires any Person to program all or part of a PEG Access charnel in exchange for consideration of any kind. 11 1~3 E. The costs of meeting the requirements of the provisions hereof may be passed through to subscribers in accordance with federal law. Section 15. Institutional Nerivork Provisions A, So long as the Grantee offers ahigh-speed cable modem service, the Grantee shall provide such service to the Grantor, upon request, at (1) a price equal to that which the Grantee charges its most favored commercial customer in the Raleigh Division for the same level of service or (2) at a twenty percent (20%) discount off the applicable conunercial rate in the Raleigh Division, whichever rate is most beneficial to the Grantor. Any rate charged to the Grantor based upon the most favored commercial customer rate shall become effective not more than sixty (60) days from the date that the Grantee has entered into a contract with the mosC favored commercial customer in the Raleigh Division. The twenty percent (20%) discount shall not be treated as a franchise related cost in accordance with the Federal Conumurications Couunission rate regulation procedures. Support by the Grantee of the Grantor's hrstitutional Network needs shall be negotiated in a separate agreement. Section 16. Transfer of Ownership or Control A. Any Franchise granted hereunder camiot be sold, transferred, leased, assigned or disposed of, including but not limited to, by force or voluntary sale, merger, consolidation, receivership or other means without the prior consent of the Grantor, which shall not be umeasonably witlrlreld, provided that the Grantee may transfer the Franchise to an entity under common control with the Grantee withotit such consent, but notice thereof shall be provided to the Grantor. B. The Grantee shall promptly notify the Grantor of any actual or proposed change in or transfer of, or' acquisition by any other party of control of the Grantee. The word "control" as used herein is not limited to major stocld~olders, but includes actual working control in whatever manner exercised. There shall be a rebuttable presumption of a transfer of control upon the disposal by the Grantee, directly or indirectly, by gift, assignment, voluntary sale, merger, consolidation or otherwise, of twenty-five percent (25%) or more, at one time, of the ownership or controlling interest in the Cable System. The Grantor shall exercise its power to approve a transfer of ownership or control in a mamier consistent with Section 617 of the Connnunications Act (47 U.S.C.. §5.37). C. For the purpose of determining whether it shall consent to such change, transferor acquisition of control, the Grantor may inquire into the legal, financial, acid technical qualifications of the prospective controlling party. Consent shall not be unreasonably witlilreld. 12 19 D- The Grantor agrees that airy financial institution having a pledge of the Franchise or its assets for the advancement of money for the construction and/or operation of the Franchise shall have the right to notify the Grantor that it or a designee satisfactory to the Grantor will take control and operate the Cable System. Furi'her; said financial institution shall also submit a plan for such operation that will insure continued service and compliance with all Franchise obligations dm-ing the teen the financial institution exercises control over the Cable System. The financial institution shall not exercise control over the Cable System for a period exceeding one (}) year, unless extended by the Grantor and during said period of time it shall have the right to petition for transfer of the Franchise to another Grantee as provided in this Section. E. The consent or approval of the Grantor to any transfer of control of the Grantee shall not constitute a waiver or release of the rights of the Grantor and any transfer shall, by its teens, be expressly subject to the terms and conditions of this Franchise. Grantee's consent to this Section is not intended to operate as a waiver of its rights under federal or state law. F. P,iry approval by the Grantor of transfer of ownership or control shall be contingent upon the prospective franchisee accepting all the duties and responsibilities of this Franchise. Section 17. Force Majeure In the event the Grantee's performance of any of the terms, conditions, obligations or requirements of this Franchise is prevented or impaired due to any cause beyond its reasonable control or not reasonably foreseeable, such inability to perform shall be deemed to be excused and no penalties or sanctions shall be imposed as a result thereof; provided the Grantee provides notice to the Grantor in writing widrin thirty (30) calendar days of the Grantee's discovery of the occurrence of such an event or within thirty (.30) calendar days of the Grantor's notice to the Grantee of a failure to perforn occasioned by such cause, which notice explains the circumstances. Such causes beyond the Grantee's reasonable control or not reasonably foreseeable shall include, but shall not be limited to, acts of God, terrorist attacks, civil emergencies and labor unrest or strikes, untimely delivery of equipment, inability of the Grantee to obtain access to property easements, Rights-of=Way and inability of the Grantee to secure all necessazy permits to utilize poles and conduits so long as the Grantee utilizes due diligence to obtain said permits in a timely fashion. Section 18. Remedies A, In addition to any other rights set out elsewhere in this Franchise, the Grantor reserves the right to declare a forfeiture of this Franchise, and all of the Grantee's rights arising hereunder, in the event that: 1.3 a~ the Grantee is found to have violated any material provision of this Franchise; or 2. the Grazrtee is found by a court of competent jurisdiction to have practiced any fraud or deceit upon the Grantor. B. The Grantor shall give the Grantee thirty (30) calendar days written notice of its intent to exercise its rights under this Section, stating the reasons for such action. If the Grantee cures the problem within the thirty (.30) day notice period, or if the Grantee initiates substantial effort to remedy the stated problem, and the efforts continue in good faith, then the Grantor shall not have the right to declare a breach of the Franchise. If the Grantee fails to cure the stated violation within the thirty (.30) day notice period, or if the Grantee does not undertake conunercially reasonable efforts to remedy the violation, then the Grantor, upon thirty (.30) calendar days notice to the Grantee, shall schedule a public bearing to review the facts and determine whether there is a basis to declare a forfeiture of this Fr°anchise At such hearing, the Grantee shall have the right to be heard and present evidence in a fashion consistent with the rules of evidence and standards governing judicial proceedings. The Grantor shall have the burden of proof: The Grantor shall issue a written decision, based on the evidence in the record, setting forth its Endings of fact and conclusions of law. The Grantee shall have the right to appeal any such decision with respect to enors of fact or law to a court of competent ,jurisdiction. Section 19. Expiration and Renewal Applicable state and federal law shall govern renewal of'this Franchise, Section 20. Forum for Litigation Any litigation between the Grantor and the Grantee arising under or regarding this Franchise shall occur, if in the state courts, in Orange County Superior or District Court having jurisdiction thereof, or if in the federal courts, in the United States District Court for the Middle District of North Carolina. Section Zl. Notice Any notice required under this Franchse shall be sufficient if~in writing and (1) delivered personally to the following addressee; or (2) deposited in the United States Mail, postage prepaid, certified mail, return receipt requested; or° (3) delivered by a reputable overnight courier service addressed as follows, or to such other address as the receiving party hereafter shall specify in writing: To the Grantor: County Manager; Orange County; PO Box 8181, Hillsborough, NC 27278 14 a~ 2. To the Grantee: Division President; Time Wamer Cable, PO Box 568; 101 hmovation Avenue #100; Morrisville, NC 27560-0568 With a copy to: Division Vice President for Govenunent and Public Affairs; Time Warner Cable; PO Sox 568; 101 hmovation Avenue #100; Morrisville, NC 27560-0568 Section 22. Severability If any Section, subsection, sentence, clause, phrase, or other portion of this Franchise is, for arry reason, declared invalid, in whole or in part, by any court, agency, conunission, legislative body, or other authority of competent ,jurisdiction, such portion shall be deemed a separate, distinct, and independent portion. Such declaration shall not affect the validity of the remaining portions hereof; wlrich other' portions shall continue in full force and effect.. Section 2.3. Non-Discrimination The Grantee shall not discriminate in any maturer- on the basis of factors prohibited by law. Section 24. Non-Divestiture This Franchise shall not divest the Grantor of any right or interest it may hold in any Public Rights-of--Way. Section 25. Performance Bond or Letter of Credit A. Within thirty (30) calendar days following the award of fire Franchise, the Grantee shall deposit with the Grantor a letter of credit or bond from a financial institution, approved by the Grantor's Finance Director or designated representative, in the amount of $10,000 if the Grantor has up to 999 Customers, $25,000 if the Grantor has 1000 to 3,999 Customers, and $50,000 if the Grantor has over 4,000 Customers. The Grantor's attorney shall approve the form and content of the letter, that approval shall not be urneasonably witlilield. The letter of credit or bond shall be used to insure the faithful performance of the Grantee of all provisions of the Franchise, and compliance with all orders, permits and directions of any agency, commission, board, department, division or office of the Grantor exercising,jurisdiction over the Grantee's acts or defaults, and payment by the Grantee of any penalties, claims, liens, liquidated damages, fees due the Grantor.. B. If the Grantee fails to pay to the Grantor any compensation, not in dispute, due the Grantor within Che time fixed herein; or fails, af{er thirty (30) calendar days notice 15 as to pay to the Grantor any penalties, claims, liens, liquidated damages, fees due the Grantor, such failure by the Grantee can be r°emedied by demand on the letter of credit. The Grantor may immediately request payment of the amount due from the letter of credit or bond.. Upon such request for payrnent, the Grantor shall notify the Grantee of the amount and date thereof. C. The letter of credit or bond shall be maintained at the amount indicated in Section 25A above during the entire term of the Franchise unless modified in accordance with the procedures provided for in Section .34 of this Franchise. bl the event that amounts are withdrawn pursuant to this Section, the Grantee, shall take any required action to restore the letter of credit or bond to the original amount within ten (10) business days of notification by the Grantor of its withdrawal against the letter of credit. D. The rights reserved to the Grantor with respect to the letter of credit or bond are in addition to all other rights of the Grantor, whether reserved by the Franchise, or authorized bylaw, and no action, proceeding or exercise of a right with respect to such a letter shall affect any other right the Gr airtor may have,. L. The letter of credit or bond shall contain the following endorsement: "It is hereby understood and agreed that this letter of credit shall rzot be canceled 67~ the sra ety nor the intention not to renew be stated by the .sureq~ until thirty (30) calendar days after receipt by the Gr°mttor, by registered snail, of a written notice of sa~ch an intention to cancel or not to renew. " F. The Grantee shall renew the letter of credit or bond not less than thirty (.30) calendar days prior to its expiration and provide a copy of the renewal to the Grantor. Failure to comply with this provision shall entitle the Grantor to draw down the letter of credit or° bond in its entirety.. Section 26. Remedies -Liquidated Damages A. Because the Grantee's failure to comply with provisions of this Franchise will result in injury to the Grantor, and because it will be difficult to estimate the extent of such injury, the Grantor and the Grantee hereby agree to the following liquidated damages, which represent both parties' best estimate of the damages resulting from the specified injury. 1. For failure to extend service in accordance with Section 4: one lumdred dollars ($100.00) for each day such offense continues, 2. For failure to submit reports, records and provide documents or information: a one time fee of two hundred fifty dollars ($250.00) for each offense. 16 a3 3. For failure to comply with transfer provisions: a one time fee of twenty- five hundred dollars ($2,500..00) for each offense; and 4. For failure to comply with any material provision herein for which a penalty is not otherwise specifically provided: a one time fee of two hundred fifty dollars ($250.00) for each offense., B. Whenever the County finds that Grantee has allegedly violated one or more material terms, conditions or provisions of the Franchise, a written notice shall be given to Grantee. The written notice shall describe in reasonable detail the alleged material violation so as to afford the Grantee an opportunity to remedy the violation. Grantee shall have .30 days subsequent to receipt of the notice in which to correct the material violation. Grantee may, within 10 days of receipt of notice, notify the County that there is a dispute as to whether a material violation or failure has, in fact, occurred. Such notice by Gruitee shall specify with particularity the matters disputed by Grantee and shall stay the rtuming of the above-described time. 1. County shall hear Grantee's dispute at the next regularly scheduled or specially scheduled Commissioners' meeting. Grantee shall have the right to examine witnesses and appear and present its side of the dispute to the County Board. The County shall determine if Grantee has committed a violation and shall make written findings of fact relative to its detenmination- 2. If after hearing the dispute, the claim is upheld by the County, then Grantee shall have 30 days within which to remedy the violation before the County may require pa}nnent of liquidated damages. 3. The time for Grantee to correct any alleged violation shall be extended by the County if the necessary action to correct the alleged violation is of such a nature or character as to require more than 30 days within which to perform provided Gr°antee conunences corrective action within 15 days and thereafter exercises due diligence to correct the violation. No liquidated damages will be assessed for a violation period that has existed prior to the expiration of the period set by the Grantor herein for correcting the defect. C. Consistent with Section 17, the Grantor shall stay or waive the imposition of any liquidated damages set forth herein upon a Ending that any failure or delay is the result of an act of God or due to circumstances beyond the reasonable control of the Grantee. Section 27. Remedies -Election 17 The exercise of one remedy shall not foreclose use of another, nor shall it relieve the Grantee of its obligations to comply with the Franchise. Remedies maybe used singly or in combination; in addition, the Grantor may exercise any rights it has under applicable law. In no event shall the election of remedies result in a double recovery by the Grantor. Sectimr 28. Books and Recm•ds -Inspection A. The Grantor may inspect the books, records, maps, plans, and other documents, including financial documents, in the conhrol or possession of the Grantee, to evaluate compliance with the Franchise. The material shall be made available at the Grantee's facilities unless the Grantee agrees to make inspection available at some other place, Material that the Grantor requires the Grantee to produce colder this Section shall be produced upon written notice, no later than thirty (.30) calendar days after the request for production. Requests for extensions of time to respond shall not be tuu°easonably denied. B. The Grantee may request that the Grantor treat any books, records, maps, plans and other documents of the Grantee containing trade secrets or proprietary information as confidential under the North Carolina Public Records Law, To the extent authorized by the Public Records Law and other applicable state and federal law, the Grantor shall maintain the confidentiality of information designated "proprietary" by the Grantee. Should the Grantor receive a request to review the Grantee's records or books under the North Carolina Public Records Law, it will promptly notify the Grantee and provide an opportunity for the Grantee to raise an objection, demonstrate why the requested infomlatiou is proprietary and, if' necessary, seek a court order to protect its proprietary information.. However, any action taken by the Grantee to protect its records or information shall be done at no cost or liability to the Grantor. Further, Grurtor agrees to cooperate with Grantee to ensure the non-disclosure of infomlation Grantee deems confidential or competitively sensitive,. C. The Grantor shall provide prompt notice of additions or deletions to its boundaries to the Grantee. To determine whether the Grantee is remitting Franchise Fees based upon revenues received fiom its customer(s) to the proper franchising authority, the Grantee shall cooperate with the Grantor by providing such information as it has reasonably available regarding its customers' addresses consistent with 47 U.S.C. §551. Section 29. Inspection of Cable System Upon Reasonable Notice, Grantor may inspect the distribution facilities and equipment of the Cable System, If; based on Customer complaints or its own investigation, the Grantor finds that the Cable System's operation is out of cornpliatice with the Franchise or applicable federal rules, it may require the Grantee to perform tests, prepare a report and present to the Grantor the results of those tests. The Grantee shall identify any problem 18 as found, advise the Grantor of the remedy it intends to pursue to correct the problem, the action to remedy the problem, and provide copies of test data to show that the problem has been corrected. Sectimr .30. Books and Records -Reports The Grantee shall provide the following to the Grantor: A. A quarterly Franchise Fee report that itemizes revenues received. B Within ninety (90) calendar days after the close of the Grantee's fiscal year, a written annual report setting forth Gross Revenues received by category for said fiscal year cer~tif ed by an official of the Grantee. Upon request of the Grantor the Grantee shall furnish to the Grantor a copy of the most recent annual report, including a financial statement, of the Grantee or its parent entity. C, A copy of any notice of deficiency, forfeiture, or other document issued by airy state or federal agency which has instituted arry investigation or civil or criminal proceeding naming the Cable System, the Grantee, or any operator of the Cable System, to the extent the same may affect or bear on the operations of the Grantee's Cable System. D. A copy of any request for protection under bankruptcy laws, or any judgment related to a declaration of bariln-uptcy by the Grantee, any affiliate that controls or manages the Grantee, or any operator of the Cable System.. Section .31. Insurance A. Within thirty (30) calendar days after the effective date of the Franchise, the Grantee shall provide proof of the requir°ed insurance. The Grantee shall maintain this insurance throughout the Franchise term.. Insurance shall include, in amounts not less than those indicated herein: 1. Worker's compensation coverage for all employees with statutory limits in compliance with applicable state and federal laws. The policy shall include employers' liability with a limit of fve-hundred thousand dollars ($500,000) for each accident; 2. Comprehensive general liability with a minimum limit of two million dollars ($2,000,000) per occurrence [four million ($4,000,000) aggregate] combined single limit for bodily injury liability and property damage liability. This shall include premises and/or operations, independent contractors, and subcontractors and/or completed operations, broad form property damage, XCU coverage, and a contractual liability endorsement; and, 19 a~ 3. Business auto policy shall have minimum limits of one million dollars ($1,000,000) per occun'enee combined single limit for bodily injury liability and property damage liability. This shall include owned vehicles, hired and non-owned vehicles. 4. Arr umbrella policy that shall have minimum limits of five million dollars ($5,000,000) per occurrence.. B. Copies of such insurance policies (or certificates of insurance) shall be filed with the Grantor. C. The Grantor shall be named as an additional insured as its interests may appear. Sectimr 32. Emergency Alert System Participation The Grantee shall install and maintain an emergency alert system [EAS] pursuant to FCC's rules and the North Carolina Emergency Alert System Plan.. Section :3.3. Service to Public Buildings The Grantee shall, upon request, provide on one outlet, Cable Service to Public Buildings located within one hundred twenty-five feet (125') of the closest useable activated point on the Grantee's existing Cable System and capable of aerial installation; provided, however, if adequate underground conduit is provided by the requesting public agency, the Grantee shall, upon request, provide Cable Service to Public Buildings within two hundred fifty feet (250') from the closest useable activated point on the Grantee's Cable System; provided however, the Grantee shall not be required to provide internal wiring, distribution lines or facilities other than to a demarcation point for video or data distribution internal to the Public Building. All char°ges for installation and provision of Cable Services to such Public Buildings shall be at the Grantee's then current rates; provided, however, that a single, free Basic Service tier outlet shall be provided to those locations listed on Exhibit B. To the extent services are provided to Public Buildings, neither the Grantor nor any other person may resell such services. Nor shall any person, organization or other entity receiving free or reduced cost services or comrections, extend such service or connection to other persons or locations without written approval by the Grantee. Section .34. Periodic Evaluation, Review and Modification. A. The Grantor and flee Grantee aclmowledge and agree that the field of cable television is a relatively new and rapidly changing one which may see many regulatory, technical, financial, marketing and legal changes during the tens of this Franchise, Therefore, in order to provide for the maximum degree of flexibility in this Franchise, and to help achieve an advanced and modern Cable System, the following evaluation and r°eview provisions will apply: 20 a~ 1. The Grantor or the Grantee may, upon thirty (30) days notice, request evaluation and review sessions at mry time during the term of this Franchise and the other party shall cooperate in such review and evaluation; provided, however, there shall not be more than one (1) evaluation and review session during any year. 2. Topics which may be discussed at any evaluation and review session include, but are not limited to, rates, Channel capacity, the Cable System performance, PEG Access, municipal uses of cable, Customer complaints, judicial rulings, FCC rulings and any other topics the Grantor or the Grantee may deem relevant. 3. During an evaluation and review session, the Grantee shall cooperate fitlly with the Grantor and shall provide without cost such reasonable information and documents prepared by Grantee in the ordinary course of business as the Grantor may request to perform the evaluation and review. 4. If at any time during the evaluation and review the Grantor reasonably believes that the teclmical performance of the Cable System violates the terms of this Franchise, the Grantor° may require the Grantee, at the Grantee's expense, to perform appropriate tests and analyses directed toward such suspected teclmical inadequacies. h~ making such request, the Grantor shall describe and identify as specifically as possible the nature of the problem and the type of test the Grantor believes to be appropriate. The Grantee shall cooperate fiilly with the Grantor in performing such tests and shall report to the Grantor the results of the tests, which shall include: a. A description of the problem in the Cable System performance that precipitated the special tests; b. The Cable System component tested; c. The equipment used and procedures employed in testing; d. The method, if any, by which the Cable System performance problem was resolved; and e. Any other information pertinent to said tests and analyses, 5. As a result of an evaluation and review session, the Grantor or the Grantee may determine that a change to the Cable System or in the terms of the Franchise may be appropriate. hr fliaC event, either the Cn'antor or the Grantee may propose modifications to the Cable System or the Franchise. The Grantee and the Grantor shall, in good faith, review the ternis of the 21 a~ proposed change or any proposed amendment to this Franchise and seek to reach agreement on such change or amendment. B The Grantor and the Grantee shall act in good faith during such negotiations and shall be obligated to agree to the reasonable requests of the other party for changes in the Cable System or amendment to the Franchise when the change or amendment is not inconsistent with the other terms of the Franchise, or with applicable law or regulations, and the change or amendment is technically feasible, economically reasonable and will not result in a material alteration of the rights and duties of the parties under the Franchise. Sectimr .35. Reservation of Rights Nottivithstarrding any other provision of this Franchise, the Gr°antor and the Grantee reserve all rights that they may possess under the law unless expressly waived herein. Section 36. Right to Purchase Grantor shall have the right to purchase the Cable System in accordance with the provisions of 47 U.S.C. §547. Section 37. Entire Agreement This Agreement is a binding contract between the parties hereto and may be modified upon agreement of'the parties pursuant to a written agreement or amendment acknowledged by both parties. Neither party has the right to unilaterally amend or alter the obligations of the other party. Tn the event of a conflict between the provisimrs of this Agreement and the Orange County Cable Television System Ordinance, the provisions of this Agreement shall conil~ol. Section 38. Grant This Franchise is awarded to Time Warner Entertainment-Advance/Newhouse Partnership pursuant and subject to the conditions and requirements hereof and applicable federal, state and generally applicable nondiscriminatory local laws- This Franchise bestows upon the Grantee the authority to construct, maintain and operate a Cable System, utilizing the Public Rights-of-Way, to offer Cable Services and Other Conununications Services within the County. Passed on First Reading Passed and Adopted on Second Reading 22 IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed. ATTEST: ORANGE COUNTY BOARD OF COMMISSIONERS BY: BY: Cleilc Chair of Board of Conmlissioners APPROVED AS TO FORM BY: Attorney 23 Section 39. Acceptance by the Company This Franchise and all of its terms and provisions shall be accepted by the Grantee in writing in the form hereinafter set forth within thirty (30) days of the grant of this Franchise by the Gounty Board and when accepted shall be f led with the Grantor's Clerk who shall record the same in the Boolc of Ordinances. Such written acceptance may be upon or at the end of a copy of this Ordinance and it shall state and express the acceptance of the said Franchise and its terms, conditions, and provisions; and the Grantee shall agree in said written acceptance to abide by, to observe and to perform the same according to al of its terms and provisions, subject to applicable state and federal law, and shall declare that statements and recitals contained on said Franchise are correct and that it has made urd does make the agreements and statements set forth in this Franchise.. Acceptance herein referred to shall be in the following form: The undersigned, Thomas Adams, in his capacity as President of the Raleigh Division of Time Warner Entertainment-Advance/Newhouse Partnership, does hereby accept and approve the Foregoing and attached Franchise and all of its terms and conditions; and in consideration of the benefits and privileges granted to it does hereby agree to abide by, carry out, observe, and perform all of the obligations and things provided to be carried out arrd performed by it in said Franchise approved by the County Boar°d, sul?ject to applicable state and federal law. This the day of 2005.. Thomas Adams, President Raleigh Division of Time Warner Entertairunent-Advance/Newhouse Partnership STATE OF NORTH CAROLINA COUNTY OF WAKE ss.. On the day of , 2005 before me a Notary Public in and for the County and State aforesaid, personally appeared Thomas Adams, the PresidenC, Raleigh Division of Time Warner Entertainment-Advance/Newhouse Partnership and on behalf of said Company, acknowledges the signing and execution of the foregoing instrument. IN TESTIMONY WHEREOF, I have hereunto subscribed my name and affixed by notarial seal on the day and year first above written.. Notary Public My commission expires: 24 ~~ EXHIBIT A EQUIPMENT PROPOSAL FOR EACH OF THE TWO SITES REFERENCED IN SECTION 13 QTY Manufacturer/description 03 Hitachi HVD30 compact 1/3" CCD color cam 03 Hitachi T16X5,5DAR11 lens with remote zoom/focus 03 Hitachi (Eagle) PT-50G light duty pan/tilt heads Q3 Hitachi PT-CCB-50 Cam control tip Q 1 Hitachi PT-PS-T2 24DC power supply w/ 4 outputs @ 3 amps each 01 Hitachi PT-T2 power and network control splitter 01 Hitachi (Eagle) PT-C pan/tilt controller w/dual joysticks 03 Hitachi PT-WM-S small indoor wall mounts for robotic heads 01 Hitachi Eagle PT-T55 touch screen controller 01 Data Video SE-800AV 4 input switcher w/ frame sync 01 JVC SR-V101 U recorder player 01 Sony PVM14L2 13" color preview monitor 01 Sony PVM 14L2 13" 02 JVC 10" multipurpose color monitors for CG PVW and record units 01 CSI#1290 Scan do scan converter for computer input to system 03 Panasonic WV-BM990 black & white monitors 03 Kramer PT 102V Video DA w/EQ 01 Kramer 104E 1X4 video DA 01 RDL RU-DA4D 1X8 Audio DA 01 Focus Enhancements Character Generator 01 Middle Atlantic racks with locking doors, shelving units and threaded rails 10/25/2005 a In the event any of the above-referenced equipment is no longer available, Grantee may substitute the make and/or model of any identified item with a similar item of the same quality. 10/25/2005 U .33 EXHIBIT B Public Facilities To Receive Free Basic Cable Service The listing of the loeations desib sated below does not exclude the addition of additional locations during the term of the )~ranchise, consistent with the provisions ofSection.33. Site Name Location/Address Southern Human Services Center 2501 Homestead Road; Chapel Hill New County Courthouse 106 East Margaret Lane; Hillsborough Government Services Center 200 South Cameron Street; Hillsborough Government Services Annex 208 South Cameron Street; Hillsborough Whitted Complex 300 West Tryon St..; Hillsborough Solid Waste 1099 Martin Luther King, Jr. Blvd; Chapel Hill Chapel Hill Senior Center 400 S. Elliott Rd; Chapel Hill Central Orange Senior Center 515 Meadowlands Drive, Ste. 500; Hillsborough Planning & Agriculture Building 306-E Revere Road; Coop Ext Food Lab; Hillsborou h Skills Development Center 503 West Franklin Street; Chapel Hill Court Street Annex 110 East King Street; Hillsborough Purchasing & Central Services 129 East King Street; Hillsborough Emergency Management Services New Hope Church Road; Chapel Hill Pathways Elementary 431 Strouds Creek Road Hillsborou h, NC 27278 Orange High School 500 Orange High School Road Hillsborou h, NC 27278 CW Stanford 308 Orange High Rd Hillsborou h, NC 27278 Efland Cheeks Elementary 4401 Fuller Road Efland, NC 27243 Central Elementary 154 Hayes St Hillsborou h, NC 27278 Hillsborough Elementary 402 North Nash Street Hillsborou h, NC 27278 Cameron Park Elementary 240 St. Mary's Road Hillsborou h, NC 27278 AL Stanback Middle School 3700 NC #86 South Hillsborou h, NC 27278 New Hope Elementary 1900 New Hope Church Road Cha el Hill, NC 27514 Cedar Ridge High School 1125 New Grady Brown Road Hillsborou h, NC 27278 Grady A Brown Elementary 1100 New Grady Brown Road Hillsborou h, NC 27278 Orange County Schools Central Administrative Office 200E King St Hillsborou h, NC 27278 Northern Human Services Center 5800 NC 86 North Hillsborou h, NC 27278 10/25/2005