FINAL DRAFT _________, 20_____
GREATER METRO CABLE CONSORTIUM
CABLE TELEVISION FRANCHISE AGREEMENT
TABLE OF CONTENTS
RECITALS 1
SECTION 1. DEFINITIONS AND EXHIBITS 2
- i -
(A) DEFINITIONS 2
(B) EXHIBITS 7
SECTION 2. GRANT OF FRANCHISE 8
2.1 Grant 8
2.2 Use of Public Streets and Ways 8
2.3 Duration 8
2.4 Effective Date 9
2.5 Franchise Nonexclusive 9
2.6 Police Powers 9
2.7 Franchise Area 9
SECTION 3: FRANCHISE FEE AND FINANCIAL CONTROLS 9
3.1 Franchise Fee 9
3.2 Payments 10
3.3 Acceptance of Payment and Recomputation 10
3.4 Quarterly Franchise Fee Reports 10
3.5 Annual Franchise Fee Reports 10
3.6 Audits 10
3.7 Interest on Late Payments 10
3.8 Alternative Franchise Compensation 11
3.9 Maximum Legal Compensation 11
3.10 Additional Commitments Not Franchise Fees 11
3.11 Costs of Publication and Elections 11
3.12 Tax Liability 11
SECTION 4: ADMINISTRATION AND REGULATION 11
4.1 Authority 11
4.2 Rates and Charges 12
4.3 Rate Discrimination 12
4.4 Filing of Rates and Charges 12
4.5 Reserved Authority 12
4.6 Time Limits Strictly Construed 13
4.7 General Performance Evaluation 13
SECTION 5. FINANCIAL AND INSURANCE REQUIREMENTS 13
5.1 Indemnification 13
5.2 Insurance 14
5.3 Letter of Credit 15
SECTION 6. CUSTOMER SERVICE 16
6.1 Customer Service Standards 16
6.2 Subscriber Contracts 16
SECTION 7. REPORTS AND RECORDS 17
7.1 Open Records 17
7.2 Confidentiality 17
7.3 Records Required 17
7.4 Annual Reports 18
7.5 Plant Survey Report 18
7.6 Copies of Federal and State Reports 18
7.7 Complaint File and Reports 19
- 2 -
7.8 Inspection of Facilities 19
7.9 Failure to Report 19
7.10 False Statements 19
SECTION 8: PROGRAMMING AND CHANNEL CAPACITY 19
8.1 Grantee Compliance 19
8.2 Channel Capacity 19
8.3 Broad Programming Categories 20
8.4 Ascertainment of Programming and Customer Satisfaction20
8.5 Deletion or Reduction of Programming Categories 20
8.6 Obscenity 20
8.7 Parental Control Device 21
8.8 Leased Access Channels 21
8.9 Broadcast Channels 21
8.10 Continuity of Service 21
SECTION 9: PUBLIC, EDUCATIONAL, AND GOVERNMENTAL ACCESS 21
9.1 Designated Access Providers 21
9.2 Channel Capacity and Use 22
9.3 Access Channel Assignments 22
9.4 Relocation of Access Channels 22
9.5 Access Interconnections 23
9.6 Support for Access Capital Costs 23
9.7 Access Support Not Franchise Fees 23
9.8 Access Channels On Lowest Non - broadcast Tier 23
9.9 Change In Technology 24
9.10 Technical Quality 24
9.11 Existing or Committed Facilities 24
9.12 Access Cooperation 24
SECTION 10. GENERAL STREET USE AND CONSTRUCTION 24
10.1 Construction 24
10.2 Location of Facilities 25
10.3 Relocation 25
10.4 Restoration of Streets 25
10.5 Maintenance and Workmanship 26
10.6 Acquisition of Facilities 26
10.7 Reservation of Grantor Streets Rights 26
10.8 Use of Conduits by Grantor 27
10.9 Street Vacation 27
10.10 Common Users 27
10.11 Discontinuing Use of Facilities 28
10.12 Hazardous Substances 28
10.13 Undergrounding of Cable 28
10.14 Construction Codes 29
10.15 Construction and Use of Poles 29
10.16 Tree Trimming 29
SECTION 11. DESIGN AND CONSTRUCTION REQUIREMENTS 30
11.1 System Design 30
- 3 -
11.2 Geographical Coverage 30
11.3 System Upgrade Schedule 30
11.4 Installation of New Cable System Underground 30
11.5 Prewiring 30
11.6 Undergrounding of Multiple - Dwelling Units 30
11.7 Rights - of - Way Occupancy 30
11.8 Completion of Work by Grantor 31
11.9 Removal of Facilities 32
11.10 Stop Work 32
11.11 Grantee's Contractors 32
11.12 Private Property 32
11.13 Burial Standards 33
SECTION 12. CONSTRUCTION AND TECHNICAL STANDARDS 33
12.1 Construction Standards 33
12.2 Technical Standards 34
12.3 Test and Compliance Procedure 34
12.4 Additional Tests 34
SECTION 13: SERVICE EXTENSION, CONSTRUCTION, AND
INTERCONNECTION34
13.1 General Requirements 34
13.2 Equivalent Service 34
13.3 Service Availability 34
13.4 Interconnection With Other Cable Systems 35
13.5 Inspection of Construction 35
13.6 Quality and Workmanship 36
13.7 Connection of Public Facilities 36
13.8 Line Extension Policy 36
SECTION 14: TECHNICAL AND OPERATIONAL STANDARDS AND
REQUIREMENTS. 37
14.1 Technical and Safety Standards 37
14.2 Cable System Performance Testing 37
14.3 Specific Technical Facilities or Capabilities 37
SECTION 15: CABLE SYSTEM REBUILD/UPGRADE 38
15.1 Upgrade or Rebuild 38
15.2 Future Rebuilds or Upgrades 38
SECTION 16. FRANCHISE BREACHES; TERMINATION OF FRANCHISE 39
16.1 Procedure for Remedying Franchise Violations 39
16.2 Assessment of Monetary Damages 40
16.3 Revocation 40
16.4 Procedures in the Event of Termination or Revocation 41
16.5 Purchase of System 41
16.6 Receivership and Foreclosure 42
16.7 No Recourse Against the Grantor 42
16.8 Nonenforcement by the Grantor 42
SECTION 17. FRANCHISE RENEWAL AND TRANSFER 42
17.1 Negotiated Renewal 42
- 4 -
17.2 Transfer of Ownership or Control 43
SECTION 18. SEVERABILITY 44
18.1 Severability 44
18.2 Waiver of Challenge 44
SECTION 19. MISCELLANEOUS PROVISIONS 44
19.1 Preferential or Discriminatory Practices Prohibited 44
19.2 Notices 44
19.3 Execution 45
EXHIBIT A 46
GMCC MEMBERSHIP 46
EXHIBIT B 47
CUSTOMER SERVICE STANDARDS 47
EXHIBIT C 48
Cable System Upgrade/Rebuild and Provision of Interactive EG Access 48
EXHIBIT C 50
EXHIBIT D 54
Construction Schedule 54
EXHIBIT E 55
GMCC - Area Public Buildings 55
EXHIBIT F 56
Form of Security 56
EXHIBIT G 57
Unconditional Acceptance of Franchise Agreement 57
- 5 -
MODEL CABLE TELEVISION SYSTEM FRANCHISE AGREEMENT
This Agreement is entered into by and between the _______________, hereinafter
referred to as "Grantor," and ____________________________, a Colorado
corporation, hereinafter referred to as the "Grantee," a wholly owned subsidiary of
United Cable Television of Colorado, Inc. ("UCTC"), and doing business as TCI of
Colorado, Inc. This Franchise and this Agreement shall be known and may be cited as
the "___________________________ Franchise Agreement." The Grantor and
Grantee are sometimes referred to collectively herein as the "parties."
UCTC is a wholly owned subsidiary of United Cable Television Corporation. Pursuant to
a merger in 1989, United Cable Television Corporation became a subsidiary of United
Artists Holdings, Inc. United Artists Entertainment Company is the parent company of
United Artists Holdings, Inc. Telecommunications, Inc. owns a majority interest in United
Artists Entertainment Company.
RECITALS
(A) Pursuant to Colorado law, local Charter and ordinance, the federal Cable
Communications Policy Act of 1984 (the "1984 Cable Act") and the Cable Television
Consumer Protection and Competition Act of 1992 (the "1992 Act" or the "1992 Cable
Act"), Grantor is authorized to grant or renew franchises to construct, operate and
maintain cable systems, utilizing public rights - of - way and properties within the Grantor's
jurisdiction.
(B) Grantee has previously constructed and desires to continue to operate and
maintain, a cable system within Grantor's jurisdiction, in accordance with applicable law
and the provisions hereof.
(C) Grantor has a legitimate and necessary regulatory role in ensuring the maximum
feasible availability of cable communications service, the high technical capability and
reliability of cable systems in its jurisdiction, the availability of local programming,
including public, educational, and governmental access programming, optimum
customer service, and fair rates, subject to the limitations of applicable law.
(D) While grant of a cable franchise to Grantee is found to be in the interest of the
welfare of the inhabitants of the Grantor, it is also in the best interests of the Grantor
and its inhabitants that such grant be limited and regulated according to the terms
hereof and of applicable law.
(E) The bases for the Grantor's lawful regulatory authority to establish an enforceable
franchise agreement and associated regulatory mechanisms are the Grantee's use of
public resources for its distribution network, limited competition in the cable service
market within the franchise area, and applicable federal law authorizing the provision of
cable services only through a local franchise agreement.
(F) Diversity in cable service and local and non - local programming is an important policy
goal. Grantee's cable system should offer a wide range of programming services which
individually may not be desired by all subscribers, but collectively represent a
substantial share of the overall value of cable to current and prospective subscribers,
including local programming. Both the Grantor and the Grantee should be mindful of
existing and evolving legal constraints regarding the regulation of program content. Both
parties' actions in effectuating this Agreement should seek to maximize channel
capacity, facilities, and programming access for government and educational agencies,
- 0 -
as well as other groups and individual members of the general public, so as to promote
open government, local programming access, educational opportunity, and a diversity of
community information and opinion, with an available "marketplace" for ideas.
(G) Flexibility to respond to changes in technology, subscriber interests, and competitive
factors within the cable service market and the larger market for entertainment and
information should be an essential characteristic of this Franchise. Both the Grantor and
the Grantee will stress maximum system flexibility to take advantage of new technology
to benefit subscribers and citizens as such technology becomes available in the future.
In consideration of the mutual consideration and promises hereinafter set forth, Grantor
and Grantee agree as follows:
SECTION 1. DEFINITIONS AND EXHIBITS
(A) DEFINITIONS
For the purposes of this Agreement and all exhibits attached hereto the following terms,
phrases, words and their derivations shall have the meaning given herein. When not
inconsistent with the context, words used in the present tense include the future, words
in the plural include the singular, and words in the singular include the plural. Words not
defined shall be given their common and ordinary meaning. The word "shall" is always
mandatory and not merely directory.
The headings, titles and catchlines of the several sections of this Agreement are
intended for reference or to indicate the contents of the sections, and shall not be taken
as part of the substantive agreement or the sections to which they refer.
1.1 "Access" means the availability for use by various agencies, institutions,
organizations, groups and individuals in the community, including the Grantor and its
designees, of the cable system to acquire, create, receive, and/or distribute video, cable
service, and/or other services and signals as permitted under applicable law, including,
but not limited to:
a. "Public Access" means access where community - based, noncommercial
organizations, groups or individual members of the general public, on a
nondiscriminatory basis, are the primary users.
b. "Educational Access" means access where schools are the primary users having
editorial control over programming and services.
c. "Government Access" means access where governmental institutions or their
designees are the primary users having editorial control over programming and
services; and
d. "PEG Access" means public access, educational access, and government access,
collectively.
1.2 "Access Channel" means any channel, or portion thereof, designated for access
purposes or otherwise made available to facilitate or transmit access programming or
services.
1.3 "Access Cost(s) or Access Capital Cost(s)" means, without limitation, any costs,
expense, charge, fee, or payment of any kind incurred in any way in connection with the
purchase of equipment for, the production of, or the provision of, access programming
or service of any kind in connection with any capital expenditure related thereto. This
definition is intended to be inclusive, not exclusive or limiting, and Grantor shall
determine the usage of Access Cost payments at its sole discretion.
1.4 "Affiliated Entity" or "Affiliate," when used in connection with Grantee means any
- 1 -
corporation, person who owns or controls, is owned or controlled by, or is under
common ownership or control with, Grantee, and/or Tele - Communications, Inc., and its
successor corporations.
1.5 "Agreement" or "Franchise Agreement" means the document in which this definition
appears, i.e. , the franchise ordinance and/or contractual agreement, executed between
Grantor and Grantee, containing the specific provisions of the authorization granted,
including references, specifications, requirements and other related matters.
1.6 "Basic Service" means any service tier which includes, at a minimum, the
retransmission of local television broadcast signals, and local access programming.
1.7 "Broadcast Signal" means a television or radio signal transmitted over the air to a
wide geographic audience, and received by a cable system off - the - air by antenna,
microwave, satellite dishes or any other means.
1.8 "Cable Operator" means any person or groups of persons, including Grantee, who
provide(s) cable service over a cable system and directly or through one or more
affiliates owns a significant interest in such cable system or who otherwise control(s) or
is(are) responsible for, through any arrangement, the management and operation of
such a cable system.
1.9 "Cable Service(s)" means the one - way transmission to subscribers of video
programming or other programming services that a cable operator makes available to
all subscribers generally, and subscriber interaction, if any, which is required for the
selection of such video programming or other programming service.
1.10 "Cable System" means a facility, consisting of a set of closed transmissions paths
and associated signal generation, reception, and control equipment that is designed to
provide cable service which includes video programming and which is provided to
multiple subscribers within a community, but such term does not include (A) a facility
that serves only to retransmit the television signals of 1 or more television broadcast
stations; (B) a facility that serves only subscribers in 1 or more multiple unit dwellings
under common ownership, control, or management, unless such facility or facilities uses
any public right - of - way; (C) a facility of a common carrier which is subject, in whole or in
part, to the provisions of Title II of the federal Communications Act (47 U.S.C. 201 et
seq.), except that such facility shall be considered a cable system (other than for
purposes of section 621(c) (47 U.S.C. 541(c)) to the extent such facility is used in the
transmission of video programming directly to subscribers; or (D) any facilities of any
electric utility used solely for operating its electric utility systems.
1.11 "Channel" means a portion of the electromagnetic or electroptical frequency
spectrum which is used in a cable system and is capable of delivering a television
channel (as television channel is defined by the FCC by regulation).
1.12 "City" (County) is the City (County) of , Colorado, (a municipal corporation or
statutory municipality,) and all of the territory within its (corporate) boundaries, as such
may change from time to time.
1.13 "Closed Channel" means an upstream or downstream channel which is not
available for residential subscribers.
1.14 "Commercial Subscribers" means any subscribers other than residential
subscribers.
1.15 "Connection," with regard to connections to public buildings, means installation of
fiber optic or coaxial cable or other cable system - related facility through the outer wall of
- 2 -
the building leaving adequate excess facility to permit further connection to other
facilities, plant or cable within the building.
1.16 "Document: or "Record" means written or graphic materials, however produced or
reproduced, or any other tangible record to the extent related to the enforcement or
administration of this Franchise.
1.17 "Downstream Channel" means a channel capable of carrying a transmission from
the headend to remote points on the cable system or to interconnection points on the
cable system.
1.18 "Dwelling Unit" means any building, or portion thereof, that has independent living
facilities, including provisions for cooking, sanitation and sleeping, and that is designed
for residential occupancy. Buildings with more than one set of facilities for cooking shall
be considered multiple dwelling units unless the additional facilities are clearly
accessory.
1.19 "Facility" means any tangible component of the cable system.
1.20 "FCC" means the Federal Communications Commission.
1.21 "Fiber Optic" means a transmission medium of optical fiber cable, along with all
associated electronics and equipment capable of carrying cable service by means of
electric lightwave impulses.
1.22 "Franchise" means the non - exclusive and revocable initial authorization or renewal
thereof for the construction or operation of a cable television system such as is granted
by this Franchise Agreement, whether such authorization is designated as a franchise,
permit, license, resolution, contract, certificate, agreement, ordinance, or otherwise, and
subject to all limitations and restrictions contained herein.
1.23 "Franchise Area" means the area within the jurisdictional boundaries of the
Grantor, including any areas annexed by the Grantor during the term of this Agreement.
1.24 "Franchise Fee" means any fee or assessment of any kind imposed by a
franchising authority or other governmental entity on Grantee or a cable subscriber, or
both, solely because of their status as such. The term "franchise fee" does not include:
a. Any tax, fee or assessment of general applicability (including any such tax, fee, or
assessment imposed on both utilities and cable operators or their services, but not
including a tax, fee, or assessment which is unduly discriminatory against cable
operators or cable subscribers);
b. Access capital costs which are required under this Agreement to be incurred by
Grantee for public, educational, or governmental access facilities;
c. Requirements or charges incidental to the awarding or enforcing of the franchise,
including but not limited to, payments for bonds, letters of credit, insurance,
indemnification, penalties, or liquidated damages; or
d. Any fee imposed under Title 17, United States Code.
1.25 "Grantee" means , and its lawful successor, transferee or assignee.
1.26 "Grantor" or "City" ("County") means the City (County) of and the area within the
jurisdictional boundaries thereof. Grantor may duly appoint any employee or agent,
which may include, but need not necessarily be limited to, the Greater Metro Cable
Consortium which the Grantor as a Member, may, if lawful under applicable law,
designate as its agent to fulfill any of the obligations under, or enforce any one or more
provisions of, this Agreement.
1.27 "DRCOG Area" means all the territorial area within the boundaries of the counties
- 3 -
of Adams, Arapahoe, Boulder, Denver, Douglas, and Jefferson Counties.
1.28 "Greater Metro Cable Consortium" or "GMCC" means a Colorado agency, formed
by intergovernmental agreement between franchising authorities in the DRCOG area to
communicate with regard to, and manage, franchising matters collectively and
cooperatively. The official list of Members of the GMCC is contained in Exhibit A, which
Exhibit Grantor may update from time to time at its sole discretion as additional
franchising authorities join, or separate from, the GMCC.
1.29 "Gross Revenues" means all amounts received or accrued by the Grantee, in
whatever form and from all sources, in connection with the operation of Grantee's cable
system within the franchise area. "Gross revenues" shall include, without limitation, all
amounts for all cable services or other services, including premium and pay - per - view
services, and all other revenues derived directly or indirectly from the operation of
Grantee's cable system within the franchise area including advertising, and installation,
regardless of whether initially recorded to another entity and however characterized.
"Gross revenues" shall also include any consideration received by any affiliate of the
Grantee where such revenue in the ordinary course of business should have been paid
to Grantee in connection with the operation of its cable system within the Grantor. By
way of illustration, this definition would include revenue derived from the sale of cable
system advertising time by an affiliate of the Grantee. "Gross revenues" shall not
include bad debt, sales taxes, other similar taxes, or the public, educational, and
governmental access capital provided for in Section 9 of this Agreement, which are
collected for direct pass - through to local, state, or federal government, aside from
franchise fees.
1.30 "Headend" or "Hub" means any facility for signal reception and dissemination on a
cable system, including cable, antennas, wires, satellite dishes, monitors, switchers,
modulators, processors for television broadcast signals, equipment for the
interconnection of the cable system with adjacent cable systems and interconnection of
any separate networks which are part of the cable system, and all other related
equipment and facilities.
1.31 "I - Net" means the institutional network connecting public facilities and
organizations within the GMCC area described in greater detail in this Agreement and
the attached exhibits, specifically Exhibit C.
1.32 "Interconnect" or "Interconnection" means the provision by Grantee of technical,
engineering, physical, financial, and all other necessary components to accomplish,
complete, and adequately maintain a physical linking of Grantee's cable system and
cable services or any designated channel or signal pathway thereof, so that cable
services of technically adequate quality may be sent to and received from other
systems, in accordance with this Agreement.
1.33 "Leased Access Channel" means any channel or portion of a channel
commercially available for programming for a fee or charge by persons other than the
Grantee.
1.34 "Node" means an electroptical transmission signal distribution location or facility, or
a branching or exchange point.
1.35 "Other Services" means lawful communications services provided over the cable
system other than cable services.
1.36 "Parent Corporation(s)" means TCI of Colorado, Inc., TCI Holdings, Inc., and
- 4 -
Tele - Communications, Inc., as now or hereafter constituted, and includes any other
existing or future corporations with fifty percent or greater ownership of Grantee or with
control over Grantee.
1.37 "Person" means any individual, sole proprietorship, partnership, association, or
corporation, or any other form of organization and includes any natural person.
1.38 "Rebuild" means to replace substantially the entire cable system plant, which may
include an upgrade of the Grantee's cable system.
1.39 "Residential Services" means cable services delivered to single or multiple
dwelling units, excluding multiple dwelling units billed on a bulk - billing basis.
1.40 "Residential Subscriber" means any Subscriber receiving residential services.
1.41 "School" means any accredited educational institution, public or independent,
including primary and secondary schools, and community colleges (excluding living
facilities.)
1.42 "Section" means any section, subsection or provision of this Agreement, and
references to the Section(s) shall include each and every subsection(s), and vice versa.
1.43 "State" means the State of Colorado.
1.44 "Street" means each of the following which have been dedicated to the public or
are hereafter dedicated to the public and maintained under public authority or by others
and located within the streets, franchise area: roadways, highways, avenues, lanes,
alleys, sidewalks, easements, rights - of - way and similar public property and areas that
the Grantor shall permit to be included within the definition of street from time to time.
1.45 "Subscriber" means any person who or which elects to subscribe to, for any
purpose, a service provided by the Grantee by means of or in connection with the cable
system and whose premises are physically wired and lawfully activated to receive cable
services from the Grantee's cable system.
1.46 "Universal Service" means cable service to all residential subscribers in the
franchise area.
1.47 "Upgrade" means an improvement in channel capacity or other technical aspect of
cable system capacity, which may be accomplished with or without a rebuild of the
cable system.
1.48 "Upstream Channel" means a channel capable of carrying a transmission to the
headend from remote points on the cable system or from interconnection points on the
cable system.
1.49 "Year," "Annual" or "Annually" means the period consisting of a full calendar year,
beginning January 1 and ending December 31 unless otherwise provided in this
Franchise.
(B) EXHIBITS
In addition to all applicable laws, regulations, rules, resolutions and ordinances,
including the Charter of the Grantor, the following numbered documents, which are
occasionally referred to in this Agreement or each other, are formally incorporated and
made a part of this Franchise Agreement by this reference:
1) Exhibit A, entitled GMCC Membership, a current listing of the members of the
Greater Metro Cable Consortium, with other relevant information for the convenience of
the parties, which Exhibit may be updated by Grantor from time to time at its sole
discretion.
2) Exhibit B, entitled Customer Service Standards, a document containing the most
- 5 -
current Customer Service Standards, with which Grantee is required to comply in
accordance with Section 6 of the Agreement, which Exhibit may be amended, revised
and updated by the Grantor from time to time at its discretion, with proper notice, and in
accordance with applicable law.
3) Exhibit C, entitled Institutional Network, which contains the terms for construction of
an institutional network by Grantee.
4) Exhibit D, entitled Construction Schedule, a document which sets forth the projected
schedule for the current upgrade and rebuild of the Grantee's facilities throughout the
metro area.
5) Exhibit E, entitled Public Buildings , a list of the public buildings within the franchise
area, which public buildings must be connected to the Cable System by Grantee in
accordance with Section 13.7 of this Agreement, Exhibit C, and other provisions of this
Agreement. New public buildings may be added to this list following construction or
purchase in accordance with this Agreement.
6) Exhibit F, entitled Form of Security , which sets forth the form and terms of the
security required in the various security provisions of this Agreement and its Exhibits,
including Section 5.3 of this Agreement.
7) Exhibit G, entitled Unconditional Acceptance of Franchise Agreement, a document in
which the Grantee indicates its unconditional acceptance of all terms and obligations of
this Agreement and agrees to be bound thereby.
In the event of conflict or ambiguity between this Franchise Agreement and the
above - referenced documents (the "Exhibits"), and any other agreement between
Grantor and Grantee, this Franchise Agreement, together with the Exhibits, shall govern
and prevail.
SECTION 2. GRANT OF FRANCHISE
2.1 Grant
(A) Grantor hereby grants to Grantee a nonexclusive and revocable authorization to
make reasonable and lawful use of the public streets and public easements within the
franchise area to construct, operate, maintain, reconstruct, rebuild and upgrade a cable
system for the purpose of providing cable services and other services subject to the
terms and conditions set forth in this Agreement and in any prior utility or use
agreements entered into with regard to any individual property. This Franchise shall
constitute both a right and an obligation to provide the services required by, and to fulfill
the obligations set forth in, the provisions of this Agreement.
(B) This Franchise is subject to the general police power of Grantor. Nothing in this
Franchise shall be deemed to waive the requirements of the other codes and
ordinances of general applicability enacted, or hereafter enacted, by the Grantor.
2.2 Use of Public Streets and Ways
Subject to the Grantor's supervision and control, Grantee may erect, install, construct,
repair, replace, reconstruct, and retain in, on, over, under, upon, across, and along the
public streets, including rights - of - way and public easements within the franchise area
such wires, cables, conductors, ducts, conduit, vaults, manholes, amplifiers, appliances,
pedestals, attachments and other property and equipment as are necessary and
appurtenant to the operation of a cable system for the provision of cable service and
other services within the franchise area. Grantee shall comply with all applicable
construction codes, laws, ordinances, regulations and procedures, now in effect or
- 6 -
enacted hereafter, including those referred to in Section 12.1. Grantee, through this
Agreement, is granted extensive and valuable rights to operate its cable system for
profit using the Grantor's public rights - of - way and public utility easements within the
franchise area in compliance with all applicable Grantor construction codes and
procedures. As trustee for the public, the Grantor is entitled to fair compensation to be
paid for these valuable rights throughout the term of the franchise.
2.3 Duration
The term of this franchise and all rights, privileges, obligations and restrictions
pertaining thereto shall be fifteen (15) years from the effective date of this Agreement,
unless terminated sooner as hereinafter provided.
2.4 Effective Date
The effective date of this Agreement shall be ________ 20___ (or 30 days after
adoption of this Agreement by the Grantor, whichever occurs later), unless the Grantee
fails to file the unconditional written acceptance of this Agreement attached as Exhibit G
and post the security required hereunder, in which event this Franchise shall be null and
void, and any and all right of the Grantee to own or operate a cable system within the
franchise area under this or any other agreement is hereby terminated.
2.5 Franchise Nonexclusive
This Franchise shall be nonexclusive, and subject to all prior rights, interests,
easements or licenses granted by the Grantor or its predecessors to any person to use
any property, right - of - way, easement, right, interest or license for any purpose
whatsoever, including the right of the Grantor to use same for any purpose it deems fit,
including the same or similar purposes allowed the Grantee hereunder. The Grantor
may at any time grant authorization to use the public rights - of - way for any purpose not
incompatible with the Grantee's authority under this Agreement and for such additional
franchises for cable systems as Grantor deems appropriate, provided however, that
such additional grants shall not contain terms and conditions materially more favorable
or less burdensome than those granted to Grantee herein in the case of similar rights
granted pursuant to this Agreement.
2.6 Police Powers
Grantee's rights hereunder are subject to the police powers of the Grantor to adopt and
enforce ordinances necessary to the safety, health, and welfare of the public, and
Grantee agrees to comply with all applicable laws and ordinances enacted, or hereafter
enacted, by the Grantor or any other legally - constituted governmental unit having lawful
jurisdiction over the subject matter hereof.
Grantor reserves the right to exercise its police powers, notwithstanding anything in this
Agreement to the contrary, and any conflict between the provisions of this Agreement
and any other present or future lawful exercise of the Grantor's police powers shall be
resolved in favor of the latter.
2.7 Franchise Area
Grantee shall provide cable services, as authorized under this Franchise, within the
franchise area and the jurisdictional boundaries of the Grantor including any areas
annexed into the Grantor during the term of this Agreement in accordance with the line
extension requirements as set forth in Section 13. 8 of this Agreement.
SECTION 3: FRANCHISE FEE AND FINANCIAL CONTROLS
- 7 -
3.1 Franchise Fee
As compensation for the benefits and privileges granted under this Franchise and in
consideration of permission to use the Grantor's streets, the Grantee shall pay as a
franchise fee to the Grantor, throughout the duration of this Agreement, an amount
equal to five (5%) percent of Grantee's gross revenues. Accrual of such franchise fee
shall commence as of the effective date of this Agreement. If Grantee provides other
services through the cable system, then the franchise fee for revenues received by the
Grantee from such other services shall be five percent (5%) of gross revenues from
such services unless Grantee demonstrates that the amount paid by Grantee exceeds
the rate paid to Grantor by other providers of the same services. Grantee shall not be
required to pay to Grantor fees and taxes on revenues from a particular service that is
unduly discriminatory when compared to those paid by the providers of the same
services.
3.2 Payments
Grantee's franchise fee payments to the Grantor shall be computed quarterly for the
preceding calendar quarter ending September 30, December 31, March 31, and June
30. Each quarterly payment shall be due and payable no later than thirty (30) days after
said dates.
3.3 Acceptance of Payment and Recomputation
No acceptance of any payment shall be construed as an accord by the Grantor that the
amount paid is, in fact, the correct amount, nor shall any acceptance of payments be
construed as a release of any claim the Grantor may have for further or additional sums
payable or for the performance of any other obligation of the Grantee.
3.4 Quarterly Franchise Fee Reports
Each payment shall be accompanied by a written report to the Grantor, verified by an
officer of the Grantee, containing an accurate statement in summarized form, as well as
in detail, of the Grantee's gross revenues and the computation of the payment amount.
Such reports shall detail all gross revenues of the system and shall be drafted in
accordance with Generally Accepted Accounting Principles.
3.5 Annual Franchise Fee Reports
The Grantee shall, within sixty (60) days after the end of each calendar year, furnish to
the Grantor a statement stating the total amount of gross receipts, gross revenues, and
all payments, deductions and computations for the period covered by the payment.
Such statement shall be audited by a certified public accountant who may also be the
chief financial officer or controller of the Grantee prior to submission to the Grantor.
3.6 Audits
On an annual basis, upon thirty (30) days prior written notice, the Grantor shall have the
right to conduct an independent audit of Grantee's records reasonably related to the
administration or enforcement of this Agreement, in accordance with Generally
Accepted Accounting Principles. If the audit shows that franchise fees have been
underpaid by five percent (5%) or more, the Grantee shall pay the total cost of the audit.
Grantor shall not do an audit in connection with the City of Baltimore rate case, and any
discrepancies resulting from the Grantee's implementation of the ruling in such case
shall not be considered an underpayment of five percent (5%) or more under this
subsection, so long as TCI implements any new ruling in such case within six weeks of
such ruling being handed down on any level of appeal.
- 8 -
3.7 Interest on Late Payments
In the event any payment is not received within forty - five (45) days from the end of the
calendar quarter, Grantee shall be assessed a late fee in the additional amount of one
hundred dollars ($100.00) per day, beginning on the forty - sixth (46th) day after the end
of calendar quarter and continued every day thereafter until the seventy - fifth (75th) day
after the end of the calendar quarter, or until payment is made, whichever is earlier. If
any payment is not received within seventy - five (75) days after the end of the calendar
quarter, Grantee shall be assessed a late fee in the additional amount of five hundred
dollars $500.00) per day, beginning on the seventy - sixth (76th) day after the end of the
calendar quarter and continuing every day thereafter until paid.
3.8 Alternative Franchise Compensation
In the event the obligation of Grantee to compensate the Grantor through franchise fees
is lawfully suspended or eliminated, in whole or part, then the Grantee shall pay to the
Grantor compensation equivalent to the compensation paid to the Grantor by other
similarly situated users of Grantor's streets for Grantee's use of Grantor's Streets,
provided that in no event shall such payments exceed the equivalent of five percent
(5%) of Grantee's Gross Revenues.
3.9 Maximum Legal Compensation
The parties acknowledge that, at present, applicable federal law limits the Grantor to
collection of a maximum permissible franchise fee of five percent of gross revenues. In
the event that at any time during the duration of this Franchise, the Grantor is
authorized to collect an amount in excess of five percent of gross revenues, then this
Agreement and Section 3.1 hereof may be amended unilaterally by the Grantor to
provide that such excess amount shall be added to the franchise fee to be paid by
Grantee to Grantor hereunder, provided that Grantee has received prior written notice
from Grantor of such amendment.
3.10 Additional Commitments Not Franchise Fees
No term or condition in this Franchise shall in any way modify or affect the Grantee's
obligation to pay franchise fees. Although the total sum of franchise fee payments and
additional commitments set forth elsewhere in this Franchise may total more than five
percent of Grantee's gross revenues in any 12 - month period, Grantee agrees that the
additional commitments herein are not franchise fees as defined under any federal law,
nor are they to be offset or credited against any franchise fee payments due to the
Grantor, subject to Exhibit C, nor do they represent an increase in franchise fees to be
passed through to subscribers pursuant to any federal law.
3.11 Costs of Publication and Elections
Grantee shall pay the reasonable cost of any election required to approve or disapprove
this Agreement pursuant to Section 2.8 of this Agreement, and of publication of this
Franchise and any amendments thereto, as such publication is reasonably required by
the Grantor or applicable law.
3.12 Tax Liability
Payment of the franchise fee under this Franchise shall not exempt Grantee from the
payment of any other license fee, tax or charge on the business, occupation, property or
income of the Grantee that may be imposed by the Grantor, except as may otherwise
be provided in the ordinance or ordinances imposing such other license fee, tax, or
charge. Any other license fees, taxes or charges shall be of general applicability in
- 9 -
nature and shall not be levied against Grantee solely because of its status as a Cable
Operator as defined herein.
SECTION 4: ADMINISTRATION AND REGULATION
4.1 Authority
(A) The Grantor shall be vested with the power and right to regulate reasonably the
exercise of the privileges permitted by this Agreement in the public interest, or to
delegate that power and right, or any part thereof, to the extent permitted under state
and local law, to any agent including, but not limited to, the GMCC, in its sole discretion;
and
(B) Subject to applicable law, Grantee shall not be relieved of its obligations to comply,
promptly and completely, with any provision of this Franchise by any failure of the
Grantor to promptly enforce compliance with this Franchise.
4.2 Rates and Charges
All Grantee rates and charges related to or regarding cable services shall be subject to
regulation by the Grantor to the full extent authorized by applicable federal, state and
local laws.
4.3 Rate Discrimination
All Grantee rates and charges shall be published (in the form of a publicly - available rate
card), made available to the public and non - discriminatory as to all persons and
organizations of similar classes, under similar circumstances and conditions. Grantee
shall apply its rates in accordance with governing law and subject to the provisions of
Section 4.2 (above), with similar rates and charges for all subscribers receiving similar
services, without regard to race, color, ethnic or national origin, religion, age, sex,
sexual orientation, marital, military or economic status, or physical or mental disability or
geographic location in Grantee's franchise area. The Grantee shall provide equivalent
cable system services to all residential subscribers at similar rates and to commercial
subscribers as authorized by FCC rules. Grantee shall permit subscribers to make any
in - residence connections the subscriber chooses without additional charge nor
penalizing the subscriber therefor. However, if any in - home connection requires service
from Grantee due to signal quality, signal leakage or other factors, caused by improper
installation of such in - home wiring or faulty materials of such in - home wiring, the
subscriber may be charged appropriate service charges by the Grantee. Nothing herein
shall be construed to prohibit:
(1) The temporary reduction or waiving of rates or charges in conjunction with valid
promotional campaigns; or
(2) The offering of reasonable discounts to senior citizens or economically
disadvantaged citizens.
(3) The offering of rate discounts for either cable service generally, or data transmission
to governmental agencies, or educational institutions.
4.4 Filing of Rates and Charges
(A) Throughout the term of this Franchise, Grantee shall maintain on file with the
Grantor a complete schedule of applicable rates and charges for cable services
provided under this Franchise. Nothing in this subsection shall be construed to require
the Grantee to file rates and charges under temporary reductions or waivers of rates
and charges in conjunction with promotional campaigns; provided that Grantee shall
notify the Grantor in writing at least a day in advance, and, so far as possible, one week
- 10 -
prior to all temporary reductions, waivers of rates or promotional campaigns. As used in
this Subsection, no rate or charge shall be considered temporary if subscribers have the
ability over a period greater than four consecutive months (or such other period as may
be approved by the Grantor) to purchase cable services at such rate or charge.
(B) Grantee shall provide a complete schedule of current rates and charges for any and
all leased access channels, or portions of such channels, provided by Grantee. The
schedule shall include a description of the price, terms and conditions established by
Grantee for leased access channels.
4.5 Reserved Authority
The Grantor reserves all regulatory authority arising from the Cable Television
Consumer Protection and Competition Act of 1992, the Cable Communications Policy
Act of 1984, any amendments or superseding statutes thereto, and any other relevant
provisions of federal, state or local law.
4.6 Time Limits Strictly Construed
Whenever this Agreement sets forth a time for any act to be performed by the Grantee,
such time shall be deemed to be of the essence, and any failure of the Grantee to
perform within the allotted time may be considered a material breach of this Agreement,
and sufficient ground for the Grantor to invoke any relevant penalty provision of this
Agreement. However, in the event that Grantee is prevented or delayed in the
performance of any of its obligations under this Agreement by reason beyond the
reasonable control of the Grantee such as acts of God, floods, fires, hurricanes,
tornados, earthquakes or other unavoidable casualty, acts of public enemy, insurrection,
war, riot, sabotage, vandalism, strikes, epidemic, or unusually severe weather
conditions, or shortages of materials or qualified labor which are not reasonably
foreseeable, the Grantee shall have a reasonable time, under the circumstances to
perform the affected obligation under this Agreement or to procure a substitute for such
obligation which is satisfactory to the City. The same force majeure exception shall
apply to Grantor with regard to any of its obligations under this Agreement.
4.7 General Performance Evaluation
(A) The Grantor may hold performance evaluation sessions within thirty (30) days of the
biennial anniversary dates of the effective date of this Agreement. All such evaluation
sessions shall be conducted by the Grantor.
(B) Special evaluation sessions may be held at any time by the Grantor during the term
of this Franchise.
(C) All regular evaluation sessions shall be open to the public and announced at least
one week in advance in a newspaper of general circulation in the franchise area. The
Grantee shall notify its subscribers of all regular evaluation sessions by announcement
on at least one channel of its system between the hours of 7:00 a.m. and 9:00 p.m. for
five (5) consecutive days preceding each session. The Grantee shall also include in its
billing or on the subscriber's bill notice to subscribers for the billing period immediately
preceding the commencement of the session, written notification of the date, time, and
place of the regular performance evaluation session, and any special evaluation session
as required by the Grantor.
(D) Topics which may be discussed at any evaluation session may include, but are not
limited to, service rate structures; franchise fees; liquidated damages; free or discounted
services; application of new technologies; system performance; services provided;
- 11 -
programming offered; customer complaints; privacy; amendments to this franchise;
judicial and FCC rulings; line extension policies; and Grantor or Grantee's rules;
provided that nothing in this subsection shall be construed as requiring the renegotiation
of this Franchise Agreement.
(E) During evaluations under this Section, Grantee shall fully cooperate with the Grantor
and shall provide such information and documents as the Grantor may require to
perform the evaluation.
SECTION 5. FINANCIAL AND INSURANCE REQUIREMENTS
5.1 Indemnification
(A) General Indemnification. Grantee shall indemnify, defend and hold the Grantor, its
officers, agents and employees, harmless from any action or claim for injury, damage,
loss, liability, cost or expense, including court and appeal costs and attorney fees or
expenses, arising from any casualty or accident to person or property, including, without
limitation, copyright infringement, and defamation, and all other damages in any way
arising out of, or by reason of, any construction, excavation, operation, maintenance,
reconstruction, or any other act done under this Franchise, by or for Grantee, its agents,
or its employees, or by reason of any neglect or omission of Grantee. Grantee shall
consult and cooperate with the Grantor while conducting its defense of the Grantor.
(B) Indemnification for Relocation. Grantee shall indemnify the Grantor for any
damages, claims, additional costs or expenses assessed against, or payable by, the
Grantor arising out of, or resulting, directly or indirectly, from, Grantee's failure to
remove, adjust or relocate any of its facilities in the streets in a timely manner in
accordance with any relocation required by the Grantor.
(C) Additional Circumstances. Grantee shall also indemnify, defend and hold the
Grantor harmless for any claim for injury, damage, loss, liability, cost or expense,
including court and appeal costs and attorney fees or expenses in any way arising out
of:
1) The lawful actions of the Grantor in granting this franchise to the extent such actions
are consistent with this franchise and applicable law;
2) Damages arising out of any failure by the Grantee to secure consents from the
owners, authorized distributors or licensees/licensors of programs to be delivered by the
cable system, whether or not any act or omission complained of is authorized, allowed
or prohibited by this Franchise.
(D) Procedures and Defense. If a claim or action arises, the Grantor or any other
indemnified party shall tender the defense of the claim to the Grantee. The Grantor may
participate in the defense of a claim at Grantee's expense and, in any event, the
Grantee may not agree to any settlement of claims affecting Grantor without the
Grantor's approval.
(E) Non - waiver. The fact that the Grantee carries out any activities under this Franchise
through independent contractors shall not constitute an avoidance of or defense to
Grantee's duty of defense and indemnification under this Section.
(F) Governmental Immunity. Grantee shall, at all times, maintain and ensure the
protections of the Grantor by the Colorado Governmental Immunity Act, or any
amendments or successor statutes thereto, and any other federal, state, or local laws
that may protect the Grantor from liability for any reason, and will take no action that
may effect a waiver or exemption from said protections on behalf of, or to, Grantor.
- 12 -
5.2 Insurance
(A) Grantee shall maintain public liability and property damage insurance that protects
the Grantee and the Grantor, its officers, agents, and employees from any and all
claims for damages or personal injury including death, demands, actions, and suits
brought against any of them arising from operations under this Franchise or in
connection therewith, in accordance with the subsections below.
(B) The insurance shall provide coverage at all times for not less than $1,000,000 for
personal injury to each person, $2,000,000 aggregate for each occurrence, and
$1,000,000 for each occurrence involving property damages, plus costs of defense; or a
single limit policy of not less than $2,000,000 covering all claims per occurrence, plus
costs of defense. The insurance limits hereunder shall be revised upward in the event
the statutory maximums applicable to local governments in Colorado are raised during
the term of this Franchise. The insurance company providing insurance pursuant to this
Section shall be licensed in the State of Colorado and shall provide insurance pursuant
to this Section comparable to general liability insurance of commercial quality.
(C) The insurance shall be without prejudice to coverage otherwise existing and shall
name as additional insureds the Grantor and its officers, agents, and employees.
Notwithstanding the naming of additional insureds, the insurance shall protect each
insured in the same manner as though a separate policy had been issued to each, but
nothing herein shall operate to increase the insurer's liability as set forth elsewhere in
the policy beyond the amount or amounts for which the insurer would have been liable if
only one person or interest had been named as insured. The coverage must apply as to
claims between insureds on the policy.
(D) The insurance shall provide that the insurance shall not be cancelled or materially
altered so as to be out of compliance with the requirements of this Section without thirty
(30) days written notice first being given to the Grantor. If the insurance is cancelled or
materially altered so as to be out of compliance with the requirements of this Section
within the term of this Franchise, Grantee shall provide a replacement policy. Grantee
agrees to maintain continuous uninterrupted insurance coverage, in the amounts
required, for the duration of this Franchise.
(E) Grantee shall maintain on file with the Grantor a certificate of insurance certifying
the coverage required above, which certificate shall be subject to the approval of the
Grantor as to the adequacy of the certificate. Willful failure to maintain adequate
insurance as required under this Section shall be cause for immediate termination of
this Franchise by the Grantor.
(F) In the alternative to providing a certificate of insurance to the Grantor certifying
insurance coverage as required above, Grantee's self - insurance shall provide the same
amount and level of protection for the Grantee and the Grantor, its officers, agents, and
employees as otherwise required under this Section. The adequacy of the
self - insurance shall be subject to the periodic review and approval of the Grantor. If
Grantee elects to provide self - insurance under this Section, any failure to maintain
adequate self - insurance shall be cause for immediate termination of this Franchise by
the Grantor.
(G) Nothing herein shall be in any way construed as a waiver on behalf of the Grantor of
any of the protections or provisions of the Colorado Governmental Immunity Act, and
Grantee shall ensure that in naming the Grantor as an insured under this Section, all
- 13 -
insurance policies or agreements shall specifically contain a non - waiver provision, and
shall not impair said protections and provisions.
5.3 Letter of Credit
(A) No later than the effective date of this Agreement, Grantee shall establish and
provide to Grantor, on behalf of Grantor and all other Members of the GMCC set forth
on Exhibit A who have entered into this Agreement, as security for the faithful
performance by Grantee of all provisions of this Agreement, and of the customer service
standards prepared by the GMCC (the "Customer Service Standards"), if adopted by
Grantor, a letter of credit in the amount of $100,000.
(B) The letter of credit shall be maintained at $100,000 throughout the term of this
Agreement, provided that at intervals no more often than every five (5) years, Grantor
shall have the right to review whether this amount should be increased to reflect
increases in the Denver Metropolitan Area Consumer Price Index during the prior five
(5) year period.
(C) The letter of credit may be assessed by Grantor, in accordance with Section 16 of
this Agreement, or under the Customer Service Standards, for purposes including, but
not limited to, the following:
(1) Failure of Grantee to pay Grantor sums due under the terms of this Agreement,
(2) Reimbursement of costs borne by the Grantor to correct franchise violations not
corrected by Grantee,
(3) Monetary remedies, penalties, or damages assessed against Grantee due to default
or breach of franchise requirements, and
(4) Failure to comply with the Customer Service Standards.
(D) Grantee agrees that it shall not attempt, through litigation or otherwise, to prevent or
inhibit Grantor from drawing on the letter of credit. Grantee shall have the right to appeal
to the GMCC Board of Directors or the governing legislative body of the Grantor for
reimbursement in the event Grantee believes the letter of credit was drawn upon
improperly. Grantee shall also have the right of a de novo court appeal if Grantee
believes the letter of credit has not been properly drawn in accordance with this
Agreement. Any funds the Grantor erroneously or wrongfully withdraws from the letter of
credit shall be returned to the Grantee with interest from the date of withdrawal at a rate
equal to the prime rate of interest as quoted by the Bank of New York within 30
business days of a final determination that the withdrawal was in error or wrongful.
(E) If Grantee fails within thirty (30) days after the date of written notice to pay to the
Grantor any franchise fee, assessment, fees or taxes lawfully due and unpaid which the
Grantor determines can be remedied by a draw upon the letter of credit, the Grantor
may thereafter withdraw the amount thereof from the letter of credit. Upon such
withdrawal, the Grantor shall notify the Grantee of the amount and date thereof.
(F) The letter of credit deposited pursuant to this Section and its accrued interest shall
become the property of the Grantor in the event that the franchise is lawfully terminated
or revoked for cause by reason of the default or material breach of the Grantee, and the
Grantee has exhausted all of its remedies relating thereto. The Grantee, however, shall
be entitled to the return of the letter of credit deposited in accordance with this Section,
or any portion thereof remaining upon normal expiration of this Agreement, or upon
termination other than for breach of a material provision by the Grantee.
(G) The rights reserved to the Grantor with respect to the letter of credit are in addition
- 14 -
to all other rights of the Grantor whether reserved by this Franchise or authorized by
law, and no action, proceeding or exercise of a right with respect to such letter of credit
shall constitute a waiver of any other right the Grantor may have.
(H) Grantor shall give Grantee written notice of any withdrawal under this section upon
such withdrawal. Within seven (7) days following receipt by the Grantee of written notice
from the Grantor that any amount has been withdrawn from the letter of credit, the
Grantee shall restore such letter of credit to the amount required under this Agreement.
Failure by the Grantee to so restore the letter of credit shall be considered a material
breach of this Agreement.
(I) If more than fifty percent (50%) based on the number of subscribers of the GMCC
Members listed on Exhibit A withdraw from the GMCC, Grantee shall have the right to
renegotiate the terms of the letter of credit or reduce it by an amount equal to the
pro - rata number of subscribers whose Grantors have withdrawn from the GMCC.
SECTION 6. CUSTOMER SERVICE
6.1 Customer Service Standards
The Grantee shall comply with any applicable customer service standards, and shall
fully comply with any provisions regarding the privacy rights of subscribers contained in
federal, state, or local law.
6.2 Subscriber Contracts
Grantee shall not enter into a contract with any subscriber which is in any way
inconsistent with the terms of this Agreement, or any Exhibit hereto, or the requirements
of any applicable customer service standards.
SECTION 7. REPORTS AND RECORDS
7.1 Open Records
Grantee shall manage all of its operations in accordance with a policy of keeping its
records open and accessible to the Grantor. The Grantor shall have access to, and the
right to inspect, any books and records of the Grantee, its parent companies and
affiliated entities which are reasonably related to the administration or enforcement of
the terms of this Agreement. Grantee shall not deny Grantor access to any of Grantee's
records on the basis that Grantee's records are under the control of any parent
company, affiliated entity or a third party. The Grantor may, in writing, request copies of
any such records or books and the Grantee shall provide such copies within thirty (30)
days of the transmittal of such request. One (1) copy of all reports and records required
under this or any other Section shall be furnished to the Grantor and to the GMCC, to
the extent that the GMCC has authority to act on behalf of, or in conjunction with, the
Grantor with respect to such report or record, at the sole expense of the Grantee. If the
requested books and records are too voluminous, or for security reasons cannot be
copied or removed, then Grantee may request, in writing within ten (10) days, that the
Grantor inspect them at the Grantee's local offices. If any books or records of the
Grantee are not kept in a local metro office and not made available in copies to the
Grantor upon written request as set forth above, and if the Grantor determines that an
examination of such records is necessary or appropriate to the performance of any of
Grantor's duties, administration or enforcement of this Agreement, then all reasonable
travel and maintenance expense(s) incurred in making such examination shall be paid
by Grantee.
- 15 -
7.2 Confidentiality
Grantor agrees to treat as confidential any books and/or records that constitute
proprietary or confidential information under federal or state law, to the extent the
Grantee makes Grantor aware of such confidentiality. The Grantee shall be responsible
for clearly and conspicuously stamping the work "Confidential" on each page that
contains confidential or proprietary information, and shall provide a brief written
explanation as to why such information is confidential under state or federal law. If the
Grantor believes it must release any such confidential books and records in the course
of enforcing this Agreement, or for any other reason, it shall advise the Grantee in
advance so that Grantee may take appropriate steps to protect its interests. If the
Grantor receives a demand from any person for disclosure of any information
designated by the Grantee as confidential, the Grantor shall, so far as consistent with
applicable law, advise the Grantee and provide the Grantee with a copy of any written
request by the party demanding access to such information within a reasonable time.
Until otherwise ordered by a court or agency of competent jurisdiction, the Grantor
agrees that, to the extent permitted by state and federal law, it shall deny access to any
of Grantee's books and records marked confidential as set forth above to any person.
7.3 Records Required
(A) Grantee shall at all times maintain:
(1) A full and complete set of plans, records and "as built" maps showing the exact
location of all cable system equipment installed or in use in the franchise area, exclusive
of electronics, subscriber service drops and equipment provided in subscriber's home;
(2) A copy of all FCC filings on behalf of Grantee, its parent companies or affiliates
which relate to the operation of the cable system;
(3) All subscriber records and information;
(4) A summary of the prior year's activities, including services added or dropped,
channel changes, number of subscribers added or terminated, all construction activity,
and total homes passed;
(5) A list of company services, rates and channel line - ups;
(6) A statistical compilation of customer or subscriber complaints, action taken and
resolution, if any, and a log of service calls.
(B) Subject to Section 7.2, all information furnished to the Grantor is public information,
and shall be treated as such, except for information involving the privacy rights of
individual subscribers.
7.4 Annual Reports
Within sixty (60) days after the close of Grantee's fiscal year, the Grantee shall submit
to the Grantor a written annual report, in a form acceptable to the Grantor, which shall
include, but not necessarily be limited to, the following information for the franchise
area:
(A) A revenue statement, certified by an officer of the cable operator;
(B) A summary of the previous year's activities in development of the cable system,
including, but not limited to, services begun or discontinued during the reporting year,
and the number of subscribers for each class of service ( i.e. , basic, expanded basic, or
premium);
(C) A statement of planned construction, if any, for the next five (5) years;
(D) A list of Grantee's officers, members of its boards of directors, and other principals
- 16 -
of the Grantee; and
(E) A list of stockholders or other equity investors holding five percent (5%) or more of
the voting interest in the Grantee and its parent, subsidiary and affiliated corporations
and other entities, if any, unless the parent is a public corporation whose annual reports
are publicly available, in which case a copy of the annual report shall be submitted.
7.5 Plant Survey Report
At the Grantor's request, Grantee shall submit to the Grantor an annual plant survey
report which shall be a complete survey of the Grantee's plant within the franchise area
and a full report thereon. Said report shall include, but not be limited to, a description of
the portions of the franchise area that have been cabled and have all services available
and an appropriate engineering evaluation including suitable electronic measurements
conducted in conformity with FCC technical standards, including supervision, as the
Grantor may prescribe. Said report shall be in sufficient detail to enable the Grantor to
ascertain that the services requirements and technical standards of this Agreement
have been achieved and maintained. Grantor shall be provided the ability to inspect "as
built" maps, upon request. If Grantor has reason to believe that portions or all of the
cable system do not meet the FCC technical standards incorporated into this
Agreement, at Grantor's request, but not more often than once per year, the Grantee
and the Grantor shall agree upon the appointment of a qualified independent engineer
to evaluate and verify the technical performance of the cable system. The cos
