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Home My WebLink AboutAgenda - 09-02-2003-9aREVISED o9/02/03 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: September 2, 2003 Action Agenda Item No. ~ -Gt 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): Proposed Cable Television Franchise Ordinance/Agreement INFORMATION CONTACT: Michael Patrick, Chair, Cable Advisory Committee Robert Sepe, Consultant, Action Audits Dave Permar, Hatch Little and Bunn, LLP Gwen. Harvey, Assistant County Manager, 245-2307. TELEPHONE NUMBERS: Hillsborough 732-8181 Chapel Hill 968-4501 Durham 688-7331 Mebane 336-227-2031 PURPOSE: To conduct a public hearing and consider approval of the first reading of a cable franchise renewal ordinance (agreement) with Time Warner Entertainment/Advance-Newhouse Partnership, as recommended by the Orange County Cable Advisory Committee, in conjunction with the Triangle J Cable Consortium consultant collaborative. BACKGROUND: The proposed ordinance/agreement, as attached, represents the "best offer" (an offer that keeps the Board's objectives paramount) derived by the Board authorized franchise negotiation team (Michael Patrick, Cable Advisory Committee Chair and Gwen Harvey,-Assistant County Manager; with technical assistance provided by Bob Sepe, Action Audits and Dave Permar, Hatch Little and Bunn, LLP), after a year of meetings with Brad Phillips, Time Warner Entertainment Government Relations and Time Warner's consulting attorney, Mark Prak. The CAC has reviewed the proposed cable television franchise ordinance/agreement and recommends its adoption by the Board. The Chair and Commissioner liaison to the CAC have also been briefed on the content of the agreement. Time Warner has been advised that this matter is scheduled for BOCC consideration and received copies of the agenda abstract and proposed agreement. Staff fully expects Time Warner representatives to be in attendance on September 2"d REVISED 09/02/03 2 The proposed agreement incorporates the following key provisions deemed important to the BOCC. Establishes a ten (10) year term. Generally, longer terms are considered for more favorable concessions by the franchise grantee. The negotiating team believes that ten years is reasonable. and appropriate in view of Time Warner's unwillingness to yield on significant PEG, cable system extension and other issues. 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. Time Warner officials resist inclusion of housing density language and assert that the corporation should only have to extend services when and if it makes good business or economic sense to do so. Requires the grantee to designate a PEG (Public, Educational, Government) access channel for sole use by the County for countywide live and recorded telecasts of Board meetings and other government access programming. Time Warner has not been willing to provide an Orange County government access channel on its system that can be viewed by all County residents. A full time countywide government access channel would be more advantageous than a shared channel with respect to the development and promotion of government services to the greater Orange County community, not just the unincorporated areas. Requires the grantee to design and install equipment to 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 Board has had a longstanding interest in the "capitalization" of County facilities used for public meetings, particularly those of the legislative process. Time Warner has offered only to address this issue separately or "off line" of the franchise ordinance/agreement. The estimated cost for a meeting room live telecast system has previously been estimated at X145,599 (Report by Bob Sepe to the TJCOG Cable Consortium February 1999) Given the position of Time Warner and given the fact that the design and cost remain a consideration for the Board, it has been suggested that the Board consider appointing a special technical consulting committee -outside of the franchise ordinance - to take up the issue independently and report back its findings and recommendations to the Board Such a committee could be comprised of representatives from the BOCC Time Warner the Cable Advisory Committee Purchasing & Central Services Information Systems and The People's Channel Sets forth the County's option to approve a monthly PEG Access fee upon basic cable service subscribers of 25 cents for years 1-5 of the franchise, and 35 cents for years 6-10. Such a fee would be applied by the grantee to customer bills only upon request by the Board. Fees collected could be used to support PEG Access facilities and equipment. Time Warner has been disinclined to include any subscriber "pass through" fee in an Orange County franchise agreement, although similar language appears in the Carrboro and Hillsborough franchise agreements. Federal law allows the County to require the cable operator provide 3 REVISED 09/02/03 capital equipment funds, the cost of which can either be absorbed by the operator or passed on to its customers. Sets forth the County's option to approve an operating expense support fee for PEG Access of up to a maximum of $2.00 per month per subscriber. Under this provision, the Board would have the opportunity, if it chose, to have the grantee collect a monthly fee from its customers that would be used to contract with a non profit such as The People's Channel, as does the Town of Chapel Hill, to provide pubic access television programs. Time Warner has been disinclined to include any subscriber "pass through" fee in an Orange County franchise agreement. .FINANCIAL IMPACT: There is no financial cost to the County for the implementation of this franchise agreement. Cable franchise revenues are calculated as an "annual fee of five percent (5°/a) of the grantee's gross revenues". The proposed agreement does not adversely affect future franchise fee revenues. In Fiscal Year 2002-03, Orange County received a total of $223,447 in franchise fees from Time Warner Cable; a cost it has passed on to its customers since 1993. RECOMMENDATION(S): The Manager recommends that the Board: 1) .Approve the first reading of the Cable Television Franchise Ordinance as proposed by the negotiating team and approved by the Cable Advisory Committee. A second reading and formal adoption of the cable television franchise ordinance would then be scheduled for the Board next meeting on September 16tH The County Attorney has advised that the Board may elect to conduct a public hearing before it takes action on the second reading of the ordinance. If the Board elects to do so, the procedure on September 16~' would be to conduct a public hearing first, and then consider second reading with possible adoption of the ordinance/agreement as the following step. 2ZAppoint a special technical consulting committee to review and provide recommendations to the Board on a video production plan to equip both meeting rooms - Hillsborough and Chapel Hill -for live public telecasts. Baoogs, PIECE, McLENDON, gUMPHaEy & LEONAaD, L.L.P. ATTOEI~'EYS AT I,AW R ALEIGZL, N08T8 CiA.BpLII~TA MAILING ADDRESS OFFICE ADDRESS POST OFFICE BOX 1800 1600 WACHOVIA CAPITOL CENTER L.P. McLENDON, JR. ALLISON M. GRIMM - RALEIGH, N.C. 27602 150 FAYETTEVILLE ST DGAR B. FISHER, JR. ELIZABETH 5. BREWINGTON W. EDWIN FULLER. JR. H. ARTHUR BOLICK II ' JAMES T. WILLIAMS, JR. J. EDWIN TURLINGTON WADE H. HARGROYE JOHN M. CROSS JR M. DANIELMcGINN , . JENNIFER K VAN Zl.NT MICHAEL D. MEEKER KATHLEEN M. THORNTON WILLL4M G. MCNAIRY DAVID W. SAR EDWARD C. WINSLOW III BRIAN J. McMILL4N HOWARD L WILLIAMS NATALIE KAY SANDERS GEORGE W. HOUSE DAVID KUSHNER - WILLIAM P.H. CARP DEREK J. ALLEN REID L PHILLIPS ELIZABETH V. LnFOLLETTE ROBERT A SINGER GINGER 5. SHIELDS JOHN H. SMALL COE W. RAMSEY RANDALL A UNDERWOOD ROBERT W. SAUNDERS 5. LEIGH RODENBOUGH N JENNIFER T. HARROD MARK J. PRgK CHARLES E COBLE JILL R. WILSON JOHN M. DrANGELiS MARL D. BISHOP CLINTON R. PINYAN JIM W. PHIWPS,JR. KATHRYN V. PURDOM MACK SPERLING STEPHEN G, HARTZELL•JORDAN JEFFREY E OLEYNIK JESSICA M. MARLIES MARK DAVIDSON TERESA DELOATCH BRYANT JOHN W. ORMAND 111 ELIZABETH TAYLOR M6HAFFEY ROBERT J. KING III ANDREW J. HAILS V. RANDALL TINSLEY CHARLES F. MARSHALL III S. KYLE WOOSLEY J. BENJAMIN DAVIS FORREST W. CAMPBELL JR. CAROLINE R. NEIL MARCUS W. TRATHEN KATHERINE A MURPHY JEAN C. BROOKS SARA R. VIZITHUM JAMES C. ADAMS 11 E C. BCOTT MEYERS Ms. Gwen Harvey Assistant County Manager Orange County Manager's Office P.O. Box 8481 200 S. Cameron Street Hillsborough, NC 27278 Dear Ms. Harvey: REST MALL RALEIGH, N.C. 27601 - HENRY E FRYE ' TELEPHONE (919) 8390300 OF COUNSEL FACSIMILE (919) 8390304 _ J. LEE LLOYD SPECIAL COUNSEL WWW.BROOKSPIERCE.COM FOUNDED 1697 AUBREYL BROOKS (1872-1958) W.H. HOLDERNESS (19041965) L.P. McLENDON (1890-1968) KENNETH M. BRIM (1896.1974) C.T. LEONARD,JR. (1929-1983) CLAUDE C.-PIERCE (191 }Iggg) THORNTON H. BROOKS (1912-1968) G. NEIL DANIELS (1911-1997) HUBERT HUMPHREY (Ig2B-2003) GREENSBORO OFFICE Au(~,~st 29 2003 2000 RENAISSANCE PLlT.4 b" f 230 NORTH ELM STREET GREENSBORO, N.C. 27401 WASHINGTON OFFICE 601 PENNSYLVANIA AVENUE, N.W. SUITE 900,-SOUTH BUILDING WASHINGTON, D.C. 20004 WRITER'S DIRECT DIAL 919.839.0108 mprak@brooksplerDe.com This letter responds to your e-mail of August 27, 2003 to Brad Phillips. As you know, this firm is counsel to Time Warner Cable. We are disappointed in your letter and in the course of unilateral action that you have, apparently, elected to pursue. As you know, the Orange County cable television franchises expired in 1996. Time Warner gave notice to the County in 1993, as required by federal law, requesting that the County initiate the formal renewal process called for by the Communications Act. See, 47 U.S.C. Section 546, r _. For its own reasons, the County elected to pursue franchise renewal discussions through the informal negotiation process. That process has been ongoing now for some ten years. This process has, in my judgment, yet to move to a conclusion because the County and its consultants seem to think that Time Warner can be forced to provide services on anon-economic basis and for which an .ascertained need has not been demonstrated. It now appears that rather than Ms. Gwen Harvey August 29, 2003 Page 2 resolving the matter through an agreement acceptable to both parties, the County staff and Cable Advisory Committee are seeking to somehow unilaterally impose an agreement on the company. Time Warner respects the County's right to advocate its .position in the informal negotiation process. Nonetheless, Time Warner hereby respectfully notifies the County that it will not accept the agreement that has been forwarded to the Board for review. Should you wish to discuss the matter further, we will, of course, be happy to do so. Regrettably, neither Brad Phillips nor I will be able to attend, on such short notice, the Board meeting scheduled for the day after Labor Day. I will be accompanying my eldest daughter to college and Mr. Phillips has a prior commitment that could not be rescheduled. We look forward to continuing to work with Orange County and its representatives to achieve a mutually satisfactory resolution of this matter. With very best regards. Sincerely, MJP/dkb )ON, L.L.P. E.. - 79577v1 ORANGE COUNTY BOARD OF COMMISSIONERS ACTION AGENDA ITEM ABSTRACT Meeting Date: September 2, 2003 Action Agen a Item No. ~_ SUBJECT: First Reading -Ordinance Granting Franchise to Time Warner Entertainment/Advance-Newhouse Partnership, to Own, Operate, and Maintain Cable System in Unincorporated Oran e County DEPARTMENT: County Manager PUBLIC HEARING: (Y/N) No ATTACHMENT(S): Proposed Cable Television Franchise Ordinance/Agreement INFORMATION CONTACT: Michael Patrick, Chair, Cable Advisory Committee Robert Sepe, Consultant, Action Audits Dave Permar, Hatch Little and Bunn, LLP Gwen Harvey, Assistant County Manager, 245-2307 TELEPHONE NUMBERS: Hillsborough 732-8181 Chapel Hill 968-4501 Durham 688-7331 Mebane 336-227-2031 PURPOSE: To review and consider approval of the first reading of a cable franchise renewal ordinance (agreement) with Time Warner Entertainment/Advance-Newhouse Partnership, as recommended by the Orange County Cable Advisory Committee, in conjunction with the Triangle J Cable Consortium consultant collaborative. BACKGROUND: The proposed ordinance/agreement, as attached, represents the "best offer" (an offer that keeps the Board's objectives paramount) derived by the Board authorized franchise negotiation team (Michael Patrick, Cable Advisory Committee (CAC) Chair and Gwen Harvey, Assistant County Manager; with technical assistance provided by and Bob Sepe, Action Audits and Dave Permar, Hatch Little and Bunn, LLP), after a year of meetings with Brad Phillips of Time Warner Entertainment Government Relations and Time Warner's consulting attorney, Mark Prak. The CAC has reviewed the proposed cable television franchise ordinance/agreement and recommends its adoption by the Board. The Chair and Commissioner liaison to the CAC have also been briefed on the content of the agreement. Time Warner has been advised that this matter is scheduled for BOCC consideration and received copies of the agenda abstract and proposed agreement. Staff fully expects Time Warner representatives to be in attendance on September 2"d 2 The proposed agreement incorporates the following key provisions deemed important to the BOCC: Establishes a ten (10) year term. Generally, longer terms are considered for more favorable concessions by the franchise grantee. The negotiating team believes that ten years is reasonable and appropriate in view of Time Warner's unwillingness to yield on significant PEG, cable system extension and other issues. Requires the grantee to extend services to any household where the number of occupied homes, and homes for which certificates of occupancy have been issued, equals at least 18 homes per street mile. Time Warner officials resist inclusion of housing density language and assert that the corporation should only have to extend services when and if it makes good business or economic sense to do so. Requires the grantee to designate a PEG (Public, Educational, Government) access channel for sole use by the County for countywide live and recorded telecasts of Board meetings and other government access programming. Time Warner has not been willing to provide an Orange County government access channel on its system that can be viewed by all County residents. A full time countywide government access channel would be more advantageous than a shared channel with respect to the development and promotion of government services to the greater Orange County community, not just the unincorporated areas. Requires the grantee to design and install equipment to 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 Board has had a longstanding interest in the "capitalization" of County facilities used for public meetings, particularly those of the legislative process. Time Warner has offered only to address this issue separately or "off line" of the franchise ordinance/agreement. Sets forth the County's option to approve a monthly PEG Access fee upon basic cable service subscribers of 25 cents for years 1-5 of the franchise, and 35 cents for years 6-10. Such a fee would be applied by the grantee to customer bills only upon request by the Board. Fees collected could be used to support PEG Access facilities and equipment. Time Warner has been disinclined to include any subscriber "pass through" fee in an Orange County franchise agreement, although similar language appears in the Carrboro and Hillsborough franchise agreements. Federal law allows the County to require the cable operator provide capital equipment funds, the cost of which can either be absorbed by the operator or passed on to its customers. Sets forth the County's option to approve an operating expense support fee for PEG Access of up to a maximum of $2.00 per month per subscriber. Under this provision, the Board would have the opportunity, if it chose, to have the grantee collect a monthly fee from its customers that would be used to contract with a non profit such as The People's Channel, as does the Town of Chapel Hill, to provide pubic access television programs. Time Warner has been disinclined to include any subscriber "pass through" fee in an Orange County franchise agreement. FINANCIAL IMPACT: There is no financial cost to the County for the implementation of this franchise agreement. Cable franchise revenues are calculated as an "annual fee of five percent (5%) of the grantee's gross revenues". The proposed agreement does not adversely affect future franchise fee revenues. In Fiscal Year 2002-03, Orange County received a total of $223,447 in franchise fees from Time Warner Cable, a cost it has passed on to its customers since 1993. RECOMMENDATION(S): The Manager recommends that the Board approve the first reading of the Cable Television Franchise Ordinance as proposed by the negotiating team and approved by the Cable Advisory Committee. A second reading and formal adoption of the cable television franchise ordinance would then be scheduled for the Board's next meeting on September 16tH The County Attorney has advised that the Board may elect to conduct a public hearing before it takes action on the second reading of the ordinance. If the Board elects to do so, the procedure on September 16tH would be to conduct a public hearing first, and then consider second reading with possible adoption of the ordinance/agreement as the following step. STATE OF NORTH CAROLINA ORANGE COUNTY ORDINANCE 2003 - /~ ~e ®/~~ Y~ rn \~l CABLE TELEVISION FRANCHISE ~~°\ \~ 4 An Ordinance granting a Franchise to Time Warner Entertainment/Advance-Newhouse Partnership, a New York general partnership ("the Grantee") to own, operate and maintain a Cable System in Orange County, North Carolina. WHEREAS, Orange County, ("the Grantor"), desires to assure the widespread availability of Cable Services within the County; WHEREAS, the Grantor has, following reasonable notice, and after consideration, analysis and deliberation conducted public proceedings, during which proceedings the technical ability, financial condition, legal qualification and general character of the Grantee were determined acceptable to receive a renewal of its Franchise; WHEREAS, the Grantor also has considered and analyzed the plans of the Grantee for the construction and operation of its Cable System and found the same to be adequate and feasible in view of the needs and requirements of the area to be 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 aCounty-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 communication facilities from other communication companies to support the operation of its Cable System. 8/22/2003 5 C. The Franchise granted herein is for a term of ten (10) years from the effective date, of this Franchise, which shall be the date of acceptance by the Grantee of the Franchise terms, and conditions as set forth in Section 39. Section 2. Definitions For the purposes of this Franchise, the following terms, phrases, words, and abbreviations shall have the following meanings. Words used in the present tense include the future 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 channel 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- commercial programming not under the Grantee's editorial control and consistent with applicable law, including: B. "Public Access" shall mean access where organizations, groups, or individual members of the general public are the designated pro~ammers having editorial control over their programming pursuant to rules promulgated by the Grantor; C. "Education Access" shall mean access where local schools are the designated programmers having editorial control over their programming, which shall concern their educational functions; and D. "Government Access" shall mean 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 governmental functions. E. "PEG Access" shall mean Public Access, Education Access and Government Access, collectively. F. "Affiliate", when used in relation to any person, shall mean another person who owns or controls, is owned or controlled by, or is under common ownership or control with, such person. G. "Basic Cable Service" or "Basic Service" shall mean any cable service tier, which includes the retransmission of local television broadcast signals. This definition shall be deemed to change consistent with any changes in the definition of this term by the Federal Communications Commission. H. "County Board" shall mean the Board of County Commissioners of Orange County, North Carolina. 8/22/2003 6 I. "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 affiliates owns a significant interest in suc;h Cable System, or 2. otherwise control or are responsible for, through any arrangement, the management and operation of such a Cable System under a Franchise with the Grantor. J. "Cable Service" shall mean: 1. The transmission to Subscribers of (i) video programming, or (ii) other Internet Protocol video program service, and 2. Subscriber interaction, if any, which is required for the selection or use of such video programming or other programming services. K. "Cable System" shall mean 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 and Other Communications Services provided to multiple Subscribers within a community, but such term does not include: 1. A facility that serves only to retransmit the television signals of one (1) or more television broadcast stations; 2. A facility that serves Subscribers without using any Public Right-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 programming directly to Subscribers; and 4. Any facilities of an electric utility used solely for operating its electric utility system. L. "Channel" shall mean a portion of the 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. M. "County" shall mean Orange County. N. "Customer Service Standards" shall mean those standards adopted by the FCC, which govern the manner in which the Grantee interacts with the public and its customers. 8/22/2003 7 O. "FCC" shall mean the Federal Communications Commission. P. "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. Q. "Franchise Fee" shall mean an annual fee of five percent (5%) of the Grantee's Gross Revenues paid for Grantor's authorization to construct and operate a Cable System within its jurisdiction. R. "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 lawful successor, transferee or assignee of said person, firm, or corporation. S. "Gross Revenues" shall mean all revenue received by the Grantee, which is derived from the operation of the Cable System to provide Cable Service which includes but is not limited to: fees charged to subscribers for Basic Cable Service, fees charged to subscribers for an optional video or audio service; fees charged to subscribers for any tier of video or audio program service other than Basic Cable Service; installation, disconnection 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 oil revenues received by the Grantee for the carnage of home shopping channels on the Cable System; marketing, launch and carriage revenues; 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 Subscribers in the Grantor's Franchise area by the total number subscribers served by the Cable System. This sum shall be the basis for computing the fee imposed pursuant to Section 6A hereof. The term "Gross Revenues" shall not include: converter 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 governmental unit; Franchise Fees; refunds to Subscribers by the Grantee; reimbursement for expenses (including returned check fees, copy expenses and similar items); or items excluded by local, state or federal law. Revenues received for the provision of Other Communication Services including data transmission, point-to-point telecommunications, or telephone services shall not be included in the Gross Revenues but may be subject to fees imposed by the Grantor, upon the provision of such services, to the extent permitted by law. T. "Initial Service Area" shall mean that geographical area within the unincorporated portions of the County. 8/22/2003 8 U. "Institutional Network or I-Net" shall mean capacity on the System used for the provision of services to the Grantor pursuant to the terms and conditions set forth in Section 14. V. "Other Communications Services" shall mean any lawful service other than Cable Service that Cable Operator makes available for purchase. W. "Person" shall mean an individual, partnership, limited partnership association, limited liability company, joint stock company, trust, corporation, or governmental entity; X. "Public Buildings" shall mean public K-12 schools, and buildings owned or leased by the County for governmental use. Y. "Public, Education, or Government Access Facilities" shall mean: 1. Channel capacity designated for PEG Access use; and 2. Facilities and equipment used for PEG Access. Z. "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, tunnel, park, parkway, square, viaduct, waterway, greenway, utility easement, and 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. AA. "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. BB. "Residential Subscriber" shall mean a Subscriber who lawfully receives Cable Service in an individual dwelling unit or multiple unit dwelling, where the service is not to be used in connection with a business, trade or profession. CC. "Subscriber" shall mean any person or entity lawfully receiving Cable Service from the Grantee pursuant to this Franchise. DD. "Service Tier" shall mean a category of Cable Service or Other Communications Services provided by a Cable Operator and for which a separate rate is charged by the Cable Operator; EE. "Year" shall mean a calendar year. 8/22/2003 9 Section 3. Service Area A. 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 annexation of territory by incorporated municipalities located within the County. B. The Grantee shall provide Cable Service to all locations within the Service Area where the dwelling density is 18 homes per mile or greater, except as provided by Section 4A. Section 4. Cable System Service Area Extension A. The Grantee shall install its Cable System (excluding only Drops to individual dwelling units) in all new subdivisions, condominiums or developments on the earlier of the date on which electric facilities or the date on which telephone facilities are installed in such subdivisions, condominiums or developments, such that Grantee shall be able to provide Cable Service to any dwelling unit in such subdivision, condominium or development solely by the installation of a "drop wire" to the Subscriber premises after such dwelling unit has been constructed and a certificate of occupancy issued. B. The Grantee shall extend service beyond its Initial Service Area 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 street mile with the measurement starting from the closest Cable System node. 1. This extension beyond the Grantee's Initial Service Area shall be completed within three (3) years from the effective date of this Agreement. The Grantor may approve additional time subject to a written request by the Grantee that delineates the case for additional time. 2. Periodically the Grantor may direct the Grantee to extend its Cable System to serve areas, such as new housing developments, where the density standard is met. Such extensions shall be completed within twelve (12) months from the date of notification. The Grantor may approve additional time subject to a written request by the Grantee that delineates the case for additional time. B. If the number of households per street mile is less than eighteen (18), the requesting resident(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 Subscriber(s)' share shall equal the remainder. For example, if the line extension density is nine (9) homes per mile, the 8/22/2003 10 Grantee shall pay fifty percent (50%) of the extension cost and the requesting Subscriber(s) shall pay the remaining fifty percent (50%). C. Upon receipt of a request for a Cable Service extension from the Grantor, the Grantee shall, within (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 firm price good for six (6) months reflecting the proportional share which requesting resident(s) must pay on a cost sharing basis to obtain Cable Service. Within ninety (90) days from payment of the cost share by prospective Subscriber(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 refund a proportionate share of the Subscriber(s)' contributions commensurate with the increase in density. Such refunds shall not be due to requesting parties after five (5) years from the date of completion of a Cable Service extension. Section 5. Customer Service Standards Grantee agrees to operate its Cable System in a manner consistent with the Customer Service Standards attached as Exhibit A, as long as such standards are not inconsistent with those of federal law. Section 6. Compensation, Auditing and Other Payments A. The Grantee shall pay the Grantor throughout the germ of this Franchise, as compensation, an annual Franchise Fee of five percent (5%) of the Grantee's Gross Revenues. B. All such payments of Franchise Fees shall be payable quarterly by April 30, July 31, October 31 and January 31 for the preceding three (3) month period ending on March 31, June 30, September 30 and December 31, respectively. Franchise Fee payments shall be accompanied by a report itemizing by service category the Gross Revenues and the calculation of the payment due for the preceding period. C. The Grantee, on an annual basis, shall furnish the C-rantor a statement within ninety (90) days of the close of the calendar year, certified by an official of the Grantee responsible for the Cable System's financial statements, reflecting the total amounts of Gross Revenues, and all payments, 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 three percent (3.0%) or more, the Grantee shall reimburse the Grantor for all reasonable costs 8/22/2003 11 actually expended in conducting any such audit. In other events, the Grantor shall bear all costs and fees, associated with any such audit. D. All of the Grantee's books and records concerning its Gross Revenues and its calculation of payments to the Grantor, shall be available for inspection by 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 be kept so as to accurately show the same. The Grantee shall prepare an 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 therefrom, as the Grantor may deem reasonably necessary or appropriate. E. In the event the Grantee makes an under payment or in. the event the Grantee fails to make any payment on or before 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. F. Consistent with federal requirements, the Grantee shall file no less frequently than annually any tariffs, amendments, or modifications affecting eh sale of its services and subscriber terminal equipment and shall provide written notification to the 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 76.305 of the FCC's rules to be maintained in the Grantee's public inspection file. Upon request, the Grantee shall provide copies of said filings to the Grantor. Section 7. 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. B. The material terms, provisions and conditions of any Franchise granted to third parties by the Grantor shall conform with federal and state law related to cable television and shall be non discriminatory. Material terms, provisions and conditions shall include at a minimum, those relating to Franchise Fees, PEG Access support in any form or manner provided, the provision of Institutional Networks, liquidated damages, insurance, bonds, letters of credit and similar instruments, reports, Customer Service Standards, computation of Gross Revenues, service to public buildings, Right-of--Way use conditions and inspection requirements. Construction may be phased in over a reasonable period of time pursuant to federal law. 8/22/2003 12 C. This Franchise authorizes the Grantee to provide Other Communications Services within the Franchise service area subject to the receipt of appropriate licenses from the FCC and/or the North Carolina Public Utility Commission. Section 8. 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 other applicable law shall not be deemed to constitute a waiver of such right 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. Neither the grant of this Franchise nor any provision herein shall constitute a waiver or bar to the exercise of any governmental right or power of the Grantor. No provision of this 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 9. 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, without limiting the Grantor's regulatory authority, pursuant to the Communications 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, state and local regulations, applicable to its Cable System, such as the National Electrical Code, National Electrical Safety Code, traffic safety/lane closure rules and construction requirements promulgated by the Grantor. Section 10. Public Right-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 Right-of--Way any property of the Grantee by reason of traffic conditions, public safety, street construction or excavation, change or 8/22/2003 13 establishment 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 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. The Grantor shall endeavor to notify and seek comment from the Grantee, with respect to minimizing disruption to the Cable System, where public works projects may affect the Grantee's Cable System. 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 accommodate the Grantee's Cable System, the Grantee shall make every effort to locate its facilities, other than Subscriber drops, within the Grantor's Rights-of--Way, unless there are legitimate legal, technical, operational, or economic reasons to do otherwise. C. The Grantee shall locate, place and construct its facilities so as not to interfere with the construction, location and maintenance of sewer or water mains, lines or connections or other public infrastructure. D. The Grantee shall adhere to all federal, state and local regulations regarding the location, construction, and maintenance of its facilities within the Public Right-of- Way. The Grantee shall take reasonable preventative measures to protect existing facilities within the Public Rights-of--Way. E. The Grantee shall restore and replace landscaped areas within the Public Right-of Way, pavement, pedestrian lighting, sidewalks, 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 (1) year from the completion of the job, readjust, fill and finish the same as may be necessary due to settling of the earth associated with the Grantee's disruption of the Public Rights-of--Way. Section 11. Initial and Continuing Tests A. The Grantee, if requested by the Grantor, shall perform all tests necessary to demonstrate compliance with the requirements of 47 C.F.R §76 subpart K. All tests shall be conducted in accordance with the FC(:'s rules at the Grantee's expense. B. Upon request, the Grantor shall be provided engineering design, construction and "as built" documents in both hard copy (paper) and electronic (data files) formats. Such maps should designate the location of the Grantee's facilities in a mutually 8/22/2003 14 acceptable form. The electronic version must be based upon NC State Plane Coordinates. Section 12. Public, Education and Government Access Provisions A. The Grantee shall continue to provide the current number of PEG Access channels available to the Grantor as of the effective date of this Franchise. B. On October 1, 2003 or upon ninety (90) days following the effective date of this Franchise, the Grantee shall designate a PEG access channel for sole use by the County for County wide live and recorded telecasts of Orange County Board meetings and other Government Access television programs. This channel may appear on an upper or expanded basic service tier until such time, but no later than January 1, 2004, the Grantee performs channel realignment, whereupon the Orange County Government Access channel shall be placed on the Basic Service Tier. C. The Grantee shall design its system and install equipment at its sole expense to provide signal transportation for County Board meeting telecasts on a designated PEG channel that originate from the: 1. 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. D. After July 1, 2004, the Grantor may require the Grantee to designate a fifth and sixth PEG channel(s) to provide up to six (6) PEG Access channels for use by the Grantor or its designee(s). The PEG Access channels shall be used for non- commercial, public, education and government purposes. The Grantee shall select PEG Access channel number assignments. The Grantor shall determine which PEG Access channels assigned by the Grantee are to be used for which PEG Access purpose. PEG Access channels shall be made available by the Grantee for use as provided for herein, by the Grantor and its residents in accordance with the rules and procedures established by the Grantor or any lawfully designated person, group, organization or agency authorized by the Grantor for that purpose. 1. Whenever the current PEG Access channel(s) are in continuous use from 4:00 p.m. to 11:00 p.m. for six (6) weeks running, the Grantor may, with ninety (90) calendar days written notice, request the fifth and sixth PEG Access channel. The Grantee shall be required to provide additional capacity for such PEG Access channel(s) when such continuous use has existed, provided, however: 8/22/2003 15 a. That in determining whether existing use is continuous and warrants additional PEG Access channel capacity, the use of repeat programming and text or character-generated programming shall not be considered; b. That when technically and economically feasible alternatives are available, the Grantee shall be given the opportunity to accommodate further channel usage for PEG Access purposes without dedicating a specific channel for PEG Access. E. Programs telecast on the PEG Access channels shall be noncommercial in nature. Program material to be distributed on PEG Access channels shall contain no advertising or commercial 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 designee allows or requires any Person to program all or part of a PEG Access channel in exchange for consideration of any kind. Program material to be distributed on PEG Access channels shall: 1. Be produced or provided in pre-produced form by any County resident or produced or provided by any agency, public or private, serving County residents regardless of the location at which the programming originated; and 2. Allow for public expression relating to educational, political, social, or cultural interests of the residents of the County. F. The Grantor may designate locations from which PEG Access programming may be originated and provided to the Grantee for distribution on the designated PEG Access channel(s), subject to the following conditions: 1. There may be one permanent Public and Education Access origination location for each designated PEG Access channel; 2. The Grantee shall not be obligated to extend its facilities from its existing Cable System distribution plant more than one hundred twenty-five (125) feet to each Public or Education Access origination location or furnish any internal wiring, modulator(s), or associated equipment. 3. PEG Access signal transportation from the permanent PEG Access origination location(s) shall be provided without charge to the Grantor by the Grantee. 4. The Grantee may incur expenses to provide signal transportation, routing and switching attributable to PEG Access channel carnage. At its 8/22/2003 16 discretion, the Grantee shall be permitted to recover all costs from its customers to provide such capability. G. The Grantor shall establish rules and procedures under which the Grantee is permitted to use PEG Access channel capacity for the provision of other services if such channel capacity is not being used for the purposes designated by this Section H. The Grantor may direct the Grantee to use addressability (encryption) of one PEG Access channel on a partial or full-time basis to limit reception of the channel to designated locations. I. The Grantor may operate or designate one or more nonprofit Access Center(s) to manage and program the PEG Access channels. The Grantor, through any contract or PEG Access channel use agreement with Access Center(s) or other nonprofit agencies, or any other party shall ensure that all forms of audio or video programming produced with equipment or through facilities provided shall not, to the extent legally possible, be made available to any other Cable Operator or other video distribution system serving residents of the County unless such Cable Operator or video distribution system remits funds to support PEG Access that are equivalent to those paid by the Grantee and its Subscribers. Section 13. Support for "PEG" Facilities and Equipment A. PEG Access Capital Charge 1. In the event the Grantor elects to approve a monthly PEG Access fee (the "PEG Capital Fee") upon Basic Service Subscribers of the Grantee's Cable System, and likewise upon any other franchised Cable System operating within the jurisdiction of the Grantor to support PEG Access facilities and equipment capital costs, the Grantee agrees to bill and collect such charge to the extent set forth herein. Upon the terms and conditions set forth below, the Grantee shall itemize and bill in its monthly statements for the PEG Access facilities and equipment capital costs. 2. The amount of the PEG Capital Fee to be billed. by the Grantee shall be: a. 25¢ for years 1-5 of this Franchise; and b. 35¢ for years 6-10 of this Franchise per Subscriber. 3. The PEG Capital Fee shall be collected by the Grantee and paid to Grantor after (i) the Grantor approves by Resolution the collection of the fee from Subscribers, (ii) notice to Grantee's customers of such inclusion, and (iii) 8/22/2003 17 the collection of the fee from such Subscribers. The Grantor, at its election, may decrease (or eliminate) the amount of the PEG Capital Charge upon sixty (60) days written notice to the Grantee. 4. The PEG Capital Fee shall be itemized as a monthly charge to directly billed Basic Service Subscribers and shall be included by the Grantee in its statements for the provision of Basic Service. No Franchise Fee payment shall be due on such funds collected by the Grantee. The Grantee's sole obligation shall be to remit the amounts of the PEG Capital Fee it collects to the Grantor on a quarterly basis along with t:he Grantee's Franchise Fee payment. Other than as outlined in Section 13A, the Grantee shall have no obligation to attempt to collect unpaid PEG Capital Fee on behalf of the Grantor. The Grantee shall not be obligated to terminate service to any Subscriber for failure to pay all or any portion of the PEG Capital Fee. 5. The Grantee's obligation to bill and remit the PEG Capital Charge shall terminate upon the Grantee's giving thirty (30;1 days written notice to the Grantor should the funds collected through the PEG Capital Fee be used by the Grantor or an Access Center, which may include the Grantor, for purposes other than the production of Public, Education, and Government Access Programming distributed within the Grantor's Franchise area over facilities provided by the Grantee. 6. The Grantee shall be permitted to recover all costs of funding Franchise requirements in support of PEG Access equipment, facilities, and channels including a return on the funding as permitted by rules of the FCC. 7. The PEG Capital Fee described in this Section is not a Franchise Fee payment and falls within 47 U.S.C. §542(g)(2;)(C). In all other respects, all payments, contributions, services, equipment, facilities support or other resources supplied by the Grantee pursuant to Franchise requirements imposed by the Grantor shall be treated in accordance with applicable law for purposes of Franchise Fee computation. 8. The Grantee shall be permitted to pass through all Franchise commitments, obligations, or payments or recover them through adjustments to Basic Service Subscriber rates, as permitted by applicable law and FCC regulations and the Grantor shall promptly approve all such rates or adjustments submitted by the Grantee in accordance with such laws or obligations. B. Operating Expense Support Fee for PEG Access 1. During the term of this Franchise, the Grantee may collect from cable television subscribers residing within Orange County, a maximum of two dollars ($2.00) per month, per Subscriber or equivalent unit to fund the 8/22/2003 18 operating expense related to Public, Educational and/or Governmental Access, or such lesser amounts periodically authorized by Grantor. 2. The Operating Expense. Support Fee ("OESF") shall be collected by the Grantee and paid to Grantor after (i) the Grantor approves by Resolution the collection of the OESF from Subscribers, (ii) notice to Grantee's customers of such inclusion, and (iii) the collection of the OESF from such Subscribers. The Grantor, at its election, Ynay decrease (or eliminate) the amount of the PEG Capital Charge upon sixty (60) days written notice to the Grantee. 3. The Grantee's sole obligation shall be to remit the amounts of the OESF it collects to the Grantor on a quarterly basis along with the Grantee's Franchise Fee payment. Other than as outllined in Section 13B, the Grantee shall have no obligation to attempt to collect unpaid OESF on behalf of the Grantor. The Grantee shall not: be obligated to terminate service to any Subscriber for failure to pay all or any portion of the OESF. Grantor shall have discretion to allocate such payments for Access operating expenses in accordance with applicable law. C. Access Support Not Franchise Fees 1. Grantee agrees that financial support for PEG Access arising from or relating to the obligations set forth in this Section shall in no way modify or otherwise affect Grantee's obligations to pay franchise fees to Grantor. Grantee agrees that although the sum of Franchise Fees and the payments set forth in this Section may total more than five percent (5%) of Grantee's Gross Revenues in any 12-month period, the additional commitments shall not be offset or otherwise credited in any way against any franchise fee payments under this Agreement. 2. Grantor recognizes franchise fees and certain additional commitments are external costs as defined under the Federal Communications Commission rate regulations in force at the time of adoption of this Franchise and Grantee has the right and ability to state franchise fees and certain other franchise related commitments on the bills of its cable television customers. Section 14. Institutional Network 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 for the same level of service or (2) at a twenty percent (20%) discount off the applicable commercial rate, whichever rate is most beneficial to the Grantor. Any rate charged to the Grantor based upon the most favored commercial customer rate 8/22/2003 19 shall become effective not more than sixty (60) days from the date that the Grantee has entered into a contract with the most favored commercial customer. The twenty percent (20%) discount shall not be treated as a franchise related cost in accordance with the Federal Communications Commission rate regulation procedures. Support by the Grantee of the Grantor's :[nstitutional Network needs shall be negotiated in a separate agreement. Section 15. Transfer of Ownership or Control A. Transfer of Franchise. Any Franchise granted hereunder cannot 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 unreasonably withheld, provided that the Grantee may transfer the Franchise to an entity under common control with the Grantee without such consent, but notice thereof shall be provided to the Grantor. B. Transfer Threshold. 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 stockholders, 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 ten percent (10%) or more, at one time, of the ownership or controlling interest in the Cable System, or twenty percent (20%) cumulatively over the term of the Franchise of such interest to a corporation, partnership, trust or association, or person or group of persons acting in concert. The Grantor shall exercise its power to approve a transfer of ownership or control in a manner consistent with Section 617 of the Communications Act (47 U.S.C. §537). C. Process. Every change, transfer, or acquisition of control of the Grantee, except a pro forma transfer of assignment contemplated by Section 15A, shall make the Franchise subject to cancellation unless and until the Grantor shall have consented thereto, which consent shall not be unreasonably withheld. For the purpose of determining whether it shall consent to such change, transfer or acquisition of control, the Grantor may inquire into the legal, financial, and technical qualifications of the prospective controlling party, and whether or not the Grantee has materially complied with the terms of the Franchise prior to transfer, and the Grantee shall assist the Grantor in any such inquiry. Failure to provide any information reasonably requested by the Grantor as part of said inquiry shall be grounds for denial of the proposed change, transfer or acquisition of control. D. Assumption of Control. The Grantor agrees that any financial institution having a pledge of the Franchise or its assets for the advancement of money for the construction and/or operation of the Franchise shall have the right to notify the 8/22/2003 20 Grantor that it or a designee satisfactory to the Grantor will take control and operate the Cable System. Further, said financial institution shall also submit a plan for such operation that will insure continued service and compliance with all Franchise obligations during the term 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 (1) 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. Regulation of Transfer. 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 terms, 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. Signatory Requirement. Any 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 16. Interconnection For the purpose of and to the extent required to accomplish transporting PEG Access channels, the Grantee shall interconnect its Cable System with its adjacent franchised Cable Systems, upon the directive of the Grantor. 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 within 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 perform 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 necessary permits to utilize poles and conduits so long as the Grantee utilizes due diligence to obtain said permits in a timely fashion. 8/22/2003 21 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: the Grantee is found to have violated any material provision of this Franchise; or 2. the Grantee 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 efforts reasonably satisfactory to the Grantor to remedy the violation, then the Grantor, upon thirty (30) calendar days notice to the Grantee, shall schedule a public hearing to review the facts and determine whether there is a basis to declare a forfeiture of this Franchise. 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 issue a written decision, based on the evidence in the record, setting forth its findings of fact and conclusions of law. The Grantee shall have the right to appeal any such decision with respect to errors 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 21. Notice Any notice required under this Franchise shall be sufficient if in writing and (1) delivered personally to the following addressee; or (2) deposited in the LJnited States Mail, postage prepaid, certified mail, return receipt requested; or (3) delivered by a reputable overnight 8/22/2003 22 courier service addressed as follows, or to such other address as the receiving party hereafter shall specify in writing: 1. To the Grantor: County Manager; Orange County; PO Box 8181, Hillsborough, NC 27278 2. To the Grantee: Division President; Time Warner Cable, PO Box 568; 101 Innovation Avenue #100; Morrisville, NC 27560-0568 Section 22. Severability If any Section, subsection, sentence, clause, phrase, or other portion of this Franchise is, for any reason, declared invalid, in whole or in part, by any court, agency, commission, 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, which other portions shall continue in full force and effect. Section 23. Non-Discrimination The Grantee shall not discriminate in any manner 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. Letter of Credit A. Within thirty (30) calendar days following the award of'the Franchise, the Grantee shall deposit with the Grantor a letter of credit 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 Subscribers, $25,000 if the Grantor has 1000 to 3,999 Subscribers, and $50,000 if the Grantor has over 4,000 Subscribers. The Grantor's attorney shall approve the form and content of the letter, that approval shall not be unreasonably withheld. The letter of credit 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 the time fixed herein; or fails, after thirty (30) calendar days notice to pay to the Grantor any penalties, claims, liens, liquidated damages, fees due the 8/22/2003 23 Grantor, such failure by the Grantee can be remedied by demand on the letter of credit. The Grantor may immediately request payment of the amount due from the letter of credit. Upon such request for payment, t:he Grantor shall notify the Grantee of the amount and date thereof. C. The letter of credit 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 35 of this Franchise. In the event that amounts are withdrawn pursuant to this Section, the Grantee, shall take any required action to restore the letter of credit 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 are in addition to all other rights of the Grantor, whether reserved by the Franchise, or authorized by law, and no action, proceeding or exercise of a right with respect to such a letter shall affect any other right the Grantor may have. E. The letter of credit shall contain the following endorsement: "It is hereby understood and agreed that this letter of credit shall not be canceled by the surety nor the intention not to renew be stated by the surety until thirty (30) calendar days after receipt by the Grantor, by registered mail, of a written notice of such an intention to cancel or not to renew. " F. The Grantee shall renew the letter of credit 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 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. Damage amounts maybe adjusted throughout term of Franchise by the Grantor by Board resolution to track changes in the Consumer Price Index. B. For failure to extend service in accordance with Section 4: five hundred dollars ($500.00) for each offense. A separate and distinct offense shall be deemed committed each calendar day on which a violation occurs or continues; 8/22/2003 24 C. For failure to submit reports, records and provide documents or information: five hundred dollars ($500.00) for each offense. A separate and distinct offense shall be deemed committed each calendar day on which a violation occurs or continues; D. For failure to comply with material requirements of the Customer Service Standards: five hundred dollars ($500.00) for each. offense. A separate and distinct offense shall be deemed committed each calendar day on which a violation occurs or continues; E. For failure to comply with transfer provisions: five hundred dollars ($500.00) for each calendar day from the date of any unlawful transfer; and F. For failure to comply with any provision herein for which a penalty is not otherwise specifically provided: five hundred dollars ($500.00) for each offense. A separate and distinct offense shall be deemed committed each calendar day on which a violation occurs or continues. G. Penalties will commence to accumulate only for days of non-compliance that occur after the final date set by the Grantor for achieving compliance. Such date shall be set at a public hearing of which the Grantee is given at least ten (10) days notice and at which it has an opportunity to be heard. No penalties 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. H. Consistent with Section 17, the Grantor shall stay or waive the imposition of any penalties set forth herein upon a finding 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 -Cumulative All remedies provided under this Franchise shall be cumulative, unless otherwise expressly stated. 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 may be used singly or in combination; in addition, the Grantor may exercise any rights it has under applicable law. Section 28. Books and Records -Inspection A. The Grantor may inspect the books, records, maps, plans, and other documents, including financial documents, in the control or possession of the Grantee, affiliates, or any person that constitutes an operator of the Grantee's Cable System: (1) to enforce the Grantor's rights or evaluate compliance with the Franchise and applicable law or (2) in the exercise of any lawful regulatory power, or (3) as may be convenient in connection with any proceeding the Grantor may or must conduct under applicable law in accordance with the terms of this Franchise. The material maybe duplicated at the Grantor's facilities unless 8/22/2003 25 the Grantee agrees to make inspection and copying available at some other place. Material that the Grantor requires the Grantee to produce under this Section shall be produced upon Reasonable Notice, no later than thirty (30) calendar days after the request for production. Requests for extensions of time to respond shall not be unreasonably 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 CTrantor 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 information 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. 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 from 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. Books and Records -Reports A. The Grantee shall provide the following to the Grantor: 1. A quarterly Franchise Fee report that itemizes revenues received. 2. 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 certified 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. 3. A copy of any notice of deficiency, forfeiture, or other document issued by any state or federal agency which has instituted any 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. 8/22/2003 26 4. A copy of any request for protection under. bankruptcy laws, or any judgment related to a declaration of bankniptcy by the Grantee, any affiliate that controls or manages the Grantee, or any operator of the Cable System. OSection 30. Books and Records -Maintenance In addition to reports required by this Franchise, the Grantee shall maintain records of the semiannual FCC proof of performance test results and records documenting compliance with federal and local Customer Service Standards. Section 31. Inspection of Cable System Upon reasonable notice, Grantor may inspect the distribution facilities and equipment of the Cable System. If, based on Subscriber complaints or its own investigation, the Grantor finds that the Cable System's operation is out of compliance 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 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. Section 32. Insurance A. Within thirty (30) calendar days after the effective date of the Franchise, the Grantee shall provide proof of the required 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 five-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, 3. Business auto policy shall have minimum limits of one million dollars ($1,000,000) per occurrence combined single limit for bodily injury liability and property damage liability. This shall include owned vehicles, hired and non-owned vehicles. 8/22/2003 27 4. An umbrella policy that shall have minimum limits of five million dollars ($5,000,000) per occurrence. B. Insurance coverage necessary to comply with this Section shall be approved by the Grantor, (such approval shall not be unreasonably withheld) and 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. Section 33. 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. The Grantor's Public Safety Communication Center shall be provided with access to the system so that it can communicate emergency messages and alerts to residents consistent with the North Carolina Emergency Alert System Plan. The emergency alert system maybe activated by the Grantee pursuant to the North Carolina Emergency Alert System Plan. Section 34. 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 Grantee's existing Cable System; 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 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 charges for installation and provision of Cable Services and Other Communication 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 connections, extend such service or connection to other persons or locations without written approval by the Grantee. Section 35. Five -Year Review: Performance Monitoring A. During the years that commence on the fifth anniversary of the effective date of the Franchise, the Grantor may commence a review of the Grantee's performance under the Franchise. As part of this review, the Grantor may consider: 1. Whether the Grantee has complied with its obligations under the Franchise and applicable law; 8/22/2003 28 2. Whether Customer Service Standards, technical standards, or bond or security fund requirements are adequate or excessive; 3. And other issues as may be raised by the Grantee, the Grantor, or the public. B. The Grantor shall conduct public hearings to provide the Grantee and the public the opportunity to comment on the Grantee's performance and other issues considered as part of the five-year review. C. Any revisions to the Franchise which either the Grantor or the Grantee wishes to make as a result of these reviews shall be proposed under the procedures established herein. D. Periodic Evaluation, Review and Modification. 1. The Grantor and the Grantee acknowledge 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 term of this Franchise. Therefore, in order to provide for the maximum degree of flexibility in this Franchise, and to help achieve a continued, advanced and modern Cable System, the following evaluation and review provisions will apply: a) The Grantor or the Grantee may, upon thirty (30) days notice, request evaluation and review sessions at any 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. b) 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, subscriber complaints, judicial rulings, FCC rulings and any other topics the Grantor or the Grantee may deem relevant. c) During an evaluation and review session, the Grantee shall cooperate fully with the Grantor and shall provide without cost such reasonable information and documents as the Grantor may request to perform the evaluation and review. d) If at any time during the evaluation and review the Grantor reasonably believes evidence exists which substantiates that the technical performance of the Cable System violates the terms of this Franchise, the Grantor may require the Grantee, at the 8/22/2003 29 Grantee's expense, to perform appropriate tests and analyses directed toward such suspected technical inadequacies. In 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 fully with the Grantor in performing such tests and shall report to the Grantor the results of the tests, which shall include: 1. A description of the problem in the Cable System performance that precipitated the special tests; 2. The Cable System component tested; 3. The equipment used and procedures employed in testing; 4. The method, if any, by which the Cable System performance problem was resolved; and 5. Any other information pertinent to said tests and analyses. e) 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 maybe appropriate. In that event, either the Grantor or the Grantee may propose modifications to the Cable System or the Franchise. The Grantee and the Grantor shall, in good faith, review the terms of the proposed change or any proposed amendment to this Franchise and seek to reach agreement on such change or amendment. 2. 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. Section 36. Conflict with Cable Regulatory Ordinance In the event of any conflict between the terms and conditions of this Franchise and the provisions of the County's Cable Standards Ordinance in effect at the time of adoption of this Agreement, the terms of this Franchise shall prevail. 8/22/2003 30 Section 37. Reservation of Rights Notwithstanding any other provision of this Franchise, the Grantor and the Grantee reserve all rights that they may possess under the law unless expressly waived herein. Section 38. Grant This Franchise is awarded to Time Warner Cable Entertainment/Advance-Newhouse Partnership pursuant and subject to the conditions and requirements and applicable federal, state and 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 Communications Services within the County. Passed on First Reading Passed and Adopted on Second Reading 1N WITNESS WHEREOF, the undersigned have caused this Agreement to be executed. ATTEST: ORANGE COUNTY BOARD OF COMMISSIONERS BY: Clerk seal BY: Chairman APPROVED AS TO FORM BY: Attorney 8/22/2003 31 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 County Board and when accepted shall be filed with the Grantor's Clerk who shall record the same in the Book 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 and 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 and performed by it in said Franchise approved by the County Board, subject to applicable state and federal law. This the day of 2003. Thomas Adams, President Raleigh Division of Time Warner Entertainment/Advance Newhouse Partnership STATE OF NORTH CAROLINA COUNTY OF WAKE ss. On the day of , 2003 before me a Notary Public in and for the County and State aforesaid, personally appeared Thomas Adams, the President, Raleigh-Durham 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. My commission expires: Notary Public 8/22/2003 32 Exhibit A Customer Service Standards Subscriber Privacy 1.1. In accordance with 47 U.S.C. § 551, the Grantee shall, no less than annually, provide a privacy notice in the form of a separate written statement to Subscribers as required by the provisions of the Act. 2. Employee Identification 2.1. When calling in person on Subscribers or other residents, all employees or authorized representatives of the Grantee are required to display an employee identification card with their name, photograph and signature, and a telephone number that can be used for verification of the representative's capacity with the Grantee. The Grantee's vehicles shall display the name of the cable company in easily distinguishable alpha-numeric characters. The Grantee shall make a reasonable effort to cause its subcontractors' vehicles to be identified in a like fashion. 3. Office and Telephone Availability 3.1. Knowledgeable, qualified company representatives will be available to respond to customer telephone Monday through Friday during normal business hours. Additionally, based on community needs, the Grantee will staff its telephones for supplemental hours on weekdays and/or weekends. 3.2. Under normal operating conditions, telephone answer time by the Grantee's customer service representatives, including wait time required to transfer the call, shall not exceed thirty (30) seconds. This standard shall be met no less than ninety percent (90%) of the time measured on an annual basis. 3.3. Under normal operating conditions, the customer shall receive a busy signal less than three percent of the total time that the Grantee's office is open for business. 3.4. Customer service center and bill payment locations operated by the Grantee shall be open for transactions Monday through Friday during normal business hours. Additionally, based on community needs, the Grantee shall schedule supplemental hours on weekdays and/or weekends during which these centers shall be open. 3.5. The Grantee shall be responsible for adopting and implementing Subscriber complaint procedures, and for advising Subscribers of the availability of these procedures. The procedures shall be designed to resolve Subscriber complaints in a timely and satisfactory manner; to develop sensitivity and responsiveness to Subscriber needs by the Grantee and its management; and to improve the quality and dependability of services to Subscribers by the Grantee. 3.6. Established complaint procedures shall include: specific provisions permitting Subscriber repair or service complaints to be received by telephone twenty-four (24) hours each day and seven (7) calendar days each week; permitting Subscriber repair 8/22/2003 33 service complaints to be received at the Grantee's business office from 8:00 A.M. until 7:00 P.M. on Monday through Friday of each week and from 9:00 A.M. until 1:00 P.M. on Saturday; and the address of the Grantee's business office. 4. Installations, Outage and Service Calls 4.1. Under normal operating conditions, each of the following standards shall be met no less than ninety-five percent (95%) of the time measured on an annual basis. 4.2. Standard installation shall be performed within seven (7) business days after an order has been placed. "Standard" installations are up to one hundred fifty (150) feet from the existing distribution system. 4.3. Excluding those situations beyond the control of the Grantee, the Grantee shall respond to service interruptions promptly and no later than twenty-four (24) hours after the interruption becomes known to the Grantee. The Grantee must begin actions to correct other service problems the next business day after notification to the Grantee of the service problem. 4.4. The "appointment window" alternatives for installations, service calls, and other installation activities shall be two (2) hour windows during normal business hours. Additionally, based on the community needs, the Grantee shall schedule supplemental hours during which appointments can be set. 4.5. If, at any time an installer or technician is running late, an attempt to contact the customer shall be made and the appointment rescheduled as necessary at a time convenient for the customer. 4.6. The Grantee shall render efficient service, make repairs promptly and interrupt service only for good cause and for the shortest time possible. Interruptions not within the midnight to 6:00 A.M. period, insofar as possible, shall be preceded by notice to Subscribers. 4.7. The Grantee office and technical personnel, in lieu of answering devices, shall receive customer calls during business hours and respond to all customer complaint calls until 10:00 P. M. on normal business days. After 10:00 P. M. on any day, trained technicians shall respond to calls if three (3) or more complaints are received by Subscribers served by a common distribution system. 5. Communication at Time of New Service or Installation 5.1. The Grantee shall provide written information in each of the following areas at the time of installation and at any future time upon request: 5.1.1. products and services offered 5.1.2. prices and service options 5.1.3. installation and service policies 5.1.4. how to use the Cable Service 8/22/2003 34 6. Rate or Channel Changes 6.1. Customers shall be notified in writing a minimum of thirty (30) calendar days in advance of any rate or channel change. 7. Statements 7.1. Subscriber billing statements shall be clear, concise and understandable. Such statements shall reflect all services and fees in an itemized fashion. 8. Refunds and Credits 8.1. Refund checks shall be issued promptly, but no later than the earlier of thirty (30) calendar days or the customer's next billing cycle following the resolution of the request or, if service was terminated thirty (30) calendar days from the date of the return of the equipment supplied by the cable company. 8.2. The Grantee shall provide outage credit to Subscribers in accordance with the following policy. 8.3. Upon notification, should the Grantee fail to correct a service outage problem -within its control -within 24 hours after having receipt of such notice, The Grantee shall credit 1/30th of the monthly charge for the affected service for each 24-hour period or fraction thereof following the first twenty-four (24) hour period during which the Subscriber experiences service outage. Subscriber must advise the Grantee of the duration of the service interruption for which credit is sought in order to receive such credit. Reasonable Notice for the purpose of this provision shall mean written, telephonic (voice), facsimile or a-mail communication to the Grantee. 9. Late Fees 9.1. Late fees shall not be assessed earlier than thirty (30) calendar days past the billing cycle due date. 10. Complaint -Appeals 10.1. Upon notification by a Subscriber of an unresolved complaint, the Assistant County Manager shall determine the facts of the complaint by obtaining information from the Subscriber and the Grantee and shall act to resolve the complaint in a manner consistent with the Grantor's authority. 8/22/2003 35 Exhibit B Public Facilities To Receive Cable Service and Cable Modem (Data) Service This table identifies sites the Grantor has chosen to be served by the Grantee via its Cable System to provide Basic Cable Service and/or high-speed data exchanges among and between public facilities. The locations designated below are not inclusive. New sites/services may be added or decommissioned during the term of the Franchise Agreement. Farili4iPO T., L2o Qo...,,,,7 Site Name Location/Address Cable TV Cable Data Southern Human Services (Yes/No (Yes/No) Center 2501 Homestead Road; Chapel Hill Yes Yes lvew County Courthouse 106 East Margaret Lane; Hillsborough Yes Yes Government Services Center 200 South Cameron Street; Hillsborough Yes Yes Government Services Annex 208 South Cameron Street; Hillsborough Yes Yes Sheriff Department 144 East Margaret Lane; Hillsborough Yes Yes Planning/Inspections 306F Revere Road; Hillsborough Yes Yes Purchasing/Central services 129 East King Yes Yes Whiffed Complex 300 West Tryon St. Yes Yes Solid Waste 1099 Airport RD Chapel Hill Yes Yes Public Works 600 US Highway 86 North Yes Yes Senior Center 400 S. Elliott Rd Chapel Hill Yes Yes Northern Human Services Center 5800 US Highway 86 North (Cedar Grove) Yes Yes Court of Clerk Annex 112 North Churton Hillsborough Yes Yes Orange Senior Center 515 Meadowlands Dr. Hillsborough Yes Yes Orange County Land Fill 1514 Eubanks Rd. Chapel Hill Yes Yes EMS New Hope Church Rd. Chapel Hill Yes Yes Skills Development Center West Franklin St. Chapel Hill Yes Yes Orange County Schools Various Yes 8/22/2003