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HomeMy WebLinkAboutOrdinance 8291 •~ ORDINANCE NO AN ORDINANCE GRANTING A FRANCHISE TO SAMMONS OF FORT WORTH, INC , ITS SUCCESSORS OR ASSIGNS, TO OWN AND OPERATE AND MAINTAIN A CABLE COMMUNICATION SYSTEM IN FORT WORTH, TEXAS, SETTING FORTH CONDITIONS ACCOMPANYING THE GRANT OF FRANCHISE, AND PROVIDING FOR THE REGULATION AND USE OF SAID SYSTEM WHEREAS, the City of Fort Worth has, following reasonable notice, conducted a full public hearing, affording all persons reasonable opportunity to be heard, which proceeding was concerned with the analysis and consideration of the technical ability, financial condition, legal qualification and general character of the franchisee and WHEREAS, the City of Fort Worth after such consideration, analysis and deliberation, has approved and found sufficient the technical ability, financial condition, legal qualification, and character of said franchisee; and WHEREAS, the said City of Fort [worth has at the said public hearing, also considered and analyzed the plans of the franchisee for the construction and operation of the cable communication system and found the same to be adequate and feasible in view of the needs and requirements of the entire area to be served by the said system and WHEREAS, it is necessary for the City of Fort Worth to grant to franchisee the right to use the public streets, highways, alleys and thoroughfares of the City for the installation of equipment, appliances or appurtenances, either or, above or below the surface of the same, to make the intended use thereof practicable and ;~ _ ~. WHEREAS the City Council has determined that it is in the best interest of and consistent with the public necessity and convenience of the City of Fort Worth to grant a franchise to Sammons of Fort Worth to operate a cable communication system within the confines of the City of Fort Worth and on the terms and conditions hereinafter set forth NOW THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH ARTICLE I GRANT OF FRANCHISE AND GENERAL PROVISTONS SECTION 1 DEFINITIONS For the purpose of this ordinance 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 number include the singular number and words in the singular number include the plural number and the use of any gender shall be applicable to all genders whenever the sense require The word shall is mandatory and may is permissive Words not defined shall be given their common and ordinary meaning a Basic Service shall mean all subscriber services provid- ed by the Company including the delivery of broadcast signals covered by the regular monthly charge paid by all subscribers excluding optional service for which a separate charge is made b Cable Communication System or System shall mean a system of antennas cables wires lines towers waveguides or other conductors converters equipment or facilities designed and constructed for the purpose of producing receiving transmitting -2- .~ a~ amplifying and distributing audio video and other forms of electronic or electrical signals located in the City Said definition shall not include any such facility that serves or will serve only subscribers in one or more multiple unit dwellings under common ownership control or management and does not use City rights-of-way c Class IV Channel means a signaling path provided by a cable communication system to transmit signals of any type from a subscriber terminal to another point in the cable communication system d City is the City of Fort Worth a municipal corporation in the State of Texas e Company is Sammons of Fort Worth the grantee of rights under this ordinance awarding a franchise or the successor transferee or assignee f Converter means an electronic device which converts signals to a frequency not susceptible to interference within the television receiver of a subscriber and by an appropriate channel selector also permits a subscriber to view all signals delivered at designated converter dial locations g Council shall mean the governing body of the City of Fort Worth h Easement shall be limited to those rights-of-way owned by the City the terms conditions or limitations upon which are not inconsistent with the erection construction or maintenance of a cable communication system its structures or equipment -3- r ~. m i FCC shall mean the Federal Communications Commission and any legally appointed designated or elected agent or successor j Gross Revenues shall mean all revenue derived directly or indirectly by the Company its affiliates subsidiaries parent and any person in which the Company has a financial interest from or in connection with the operation of a cable communication system pursuant to this ordinance provided however all revenues shall include but not be limited to basic subscriber service monthly fees pay cable fees installation and reconnection fees leased channel fees converter rentals and advertising revenues and that this shall not include any taxes on services by the Company herein imposed directly upon any subscriber or user by the state city or other governmental unit and collected by the Company on behalf of said governmental unit k Street is a way or place of whatever nature publicly maintained and open to the use of the public for purposes of vehicu- lar travel Street shall include road highway bridge tunnel or alley 1 Installation shall mean the connection of the System from feeder cable to subscribers terminals m Sidewalk is that portion of a street other than the roadway set apart by curbs barriers markings or other delineation for pedestrian travel including parkways not on private lands SECTION 2 GRANTING OF RIGHTS AND PRIVILEGES OF COMPANY The City hereby grants to Company for the full term of 15 years from the effective date of this Ordinance a nonexclusive right privilege and franchise to have acquire erect construct -4- reconstruct maintain use and operate for the entire area of the City a System and to have acquire erect construct reconstruct maintain use and operate in over under along and across the present and future streets sidewalks and other public easements all necessary or desirable poles wires cable underground conduits manholes and other structure and appurtenances necessary for the maintenance and operation of a System for the interception sale transmission and distribution of television programs and other audio-visual electrical signals and the right to transmit the same to the inhabitants of the City on the terms and conditions hereinafter set forth SECTION 3 GRANT NONEXCLUSIVE This grant for use of City streets sidewalks and other public easements is nonexclusive and does not establish priority for use over other franchise holders permit holders and the City s own use of public property Additionally Company shall respect rights and property of the City and other authorized users of streets sidewalks and other public easements Disputes between Company and other parties over use of the streets sidewalks and other public easements shall be submitted to the City Manager or his designee for resolution SECTION 4 AGREEMENT, ACCEPTANCE AND INCORPORATION OF APPLICATION BY REFERENCE Upon adoption of this franchise and execution hereof by Com- pany Company agrees to be bound by all the terms and conditions contained herein as evidenced by filing with the City Secretary in writing within fifteen (15) days after the final passage of this -5- r franchise an unconditional acceptance of the franchise and promise to comply with and abide by all its provisions terms and condi- tions The acceptance and promise shall be sworn to by or on behalf of the Company before a notary public The Company also agrees to provide all services specifically set forth in its application to provide cable communication ser- vices within the confines of the City of Fort Worth and by its acceptance of the franchise the Company specifically grants and agrees that its application is thereby incorporated by reference and made a part of the franchise of this ordinance In the event of a conflict between such proposals and the provisions of this ordinance that provision which provides the greatest benefit to the City in the opinion of the Council shall prevail SECTION 5 TIME IS OF THE ESSENCE TO THIS AGREEMENT Whenever the franchise shall set forth any time for an act to be performed by or on behalf of the Company such time shall be deemed of the essence and any failure of the Company to perform within time allotted shall always be sufficient grounds for the City to invoke an appropriate penalty including possible revocation of the franchise SECTION 6 PAYMENT OF FRANCHISE FEE a For the reason that the streets to be used by the Company in the operation of its system within the boundaries of the City are valuable public properties acquired and maintained by the City at great expense to its taxpayers and that the grant to the Company to the said streets is a valuable property right without which the -6- „~ f~:: Company would be required to invest substantial capital in right-of-way costs and acquisitions and because the City will incur costs in regulating and administrating the franchise the Company shall pay to the City an amount equal to five percent (5%) of Company s gross annual revenue from all sources attributable to the operation of the Company within the confines of the City of Fort Worth In the event that it is determined that the FCC lacks jurisdiction to impose a limitation on franchise fees or that the limit is raised then the franchise fee will be subject to renegotiation b The franchise fee and any other cost or penalties assessed shall be payable quarterly to the City of Fort Worth not later than thirty (30) days after the end of the quarter for which said payment is made The payment shall be delivered to the Director of Finance along with a complete statement certified by an officer of the Company showing the calculations of the amount of such payment c The City shall have the right to review and audit the Company s income records and the related books and records and to recompute any amounts determined to be payable under this ordinance provided however that such audit shall take place within thirty-six (36) months following the close of the fiscal year cover- ed by such statement(s) Any additional amount due to the City as a result of the City s review or audit shall be paid within thirty (30) days following written notice to the Company by the City which notice shall include a copy of the audit report d In the event that any franchise payment or recomputed amount cost or penalty is not made on or before the applicable -7- 'I dates heretofore specified interest shall be charged daily from such date at the annual rate of ten percent (10%) SECTION 7 POLICE POWERS In accepting this franchise the Company acknowledges that its rights hereunder are subject to the police power of the City to adopt and enforce general ordinances necessary to the safety and welfare of the public and it agrees to comply with all applicable general laws and ordinances enacted by the City pursuant to such power Any conflicts between the provisions of this franchise and any other present or future lawful exercise of the City s police powers shall be resolved in favor of the latter except that any such exercise that is not of general application in the jurisdiction or applies exclusively to Company or cable communication systems which contains provisions inconsistent with this franchise shall prevail only if upon such exercise the City finds an emergency exists constituting a danger to health safety property or general welfare or such exercise is mandated by law SECTION 8 CABLE COMMUNICATION SYSTEM FRANCHISE REQUIRED No cable communication system shall be allowed to occupy or use the streets of the City or be allowed to operate without a franchise SECTION 9 USE OF COMPANY FACILITIES The City shall have the right during the life of this fran- chise to install and maintain free of charge upon the poles of the Company any wire and pole fixtures that do not unreasonably -8- .;~ interfere with the system operations of the Company The City agrees to indemnify defend and hold the company harmless from actions resulting from the City s use thereof SECTION 10 RATES The City shall by ordinance set fair and reasonable rates to both Company and subscribers which in the aggregate meet all applicable costs of service provided by company including fair return on invested capital assuming efficient and economical man- agement Initial basic subscriber rates shall be effective for a minimum of two (2) years from the date of commencing operations or until Company has completed all construction as indicated in its application for the first and second years of construction which ever is longer The procedure to change subscriber rates shall be in accordance with Article III Section 3 and 5 SECTION 11 COSTS Costs to be borne by Company shall include but shall not be limited to all costs of publication of this ordinance and any and all notices prior to any public meeting provided for pursuant to this franchise and the costs incurred by the City in its study preparation of proposal documents evaluation of all applications and examination of applicants qualifications (less the total amount of application fees received from all applicants) not to exceed Fifty Thousand Dollars ($50 000 00) SECTION 12 NOTICES All notices from Company to the City pursuant to this franchise shall be to the City Manager 1000 Throckmorton Fort Worth Texas -9- 76102, or to such officer as designated by the City Council Company shall maintain with the City, throughout the term of this franchise, an address for service of notices by mail Company shall also maintain with the City, a local office and telephone number for the conduct of matters related to this franchise during normal business hours All notices to the Company pursuant to this franchise shall be to 2630 W Freeway, Suite 130, Fort Worth, Texas 76102, or to such other officer designated by the Company SECTiON 13 LETTER OF CREDIT a Within ten (10) days after the award of this franchise, the company shall deposit with the City a letter from a financial institution in the amount of $100,000 00 The form and content of such letter and credit shall be approved by the City Attorney The letter of credit shall be used to insure the faithful performance by the Company of all provisions of this franchise and compliance with all orders, permits and directions of any agency, commission, board, department, division or office of the City having jurisdiction aver its acts or defaults under this franchise, and the payment by the Company of any claims, liens and taxes due the City which arise by reason of the construction, operation or maintenance of the system b The letter of credit shall be maintained at $100,000 00 during the entire term of this franchise, even if amounts have to be withdrawn pursuant to subdivision a or c of this section c If the Company fails to pay to the City any compensation within the time fixed herein or, fails, after ten (10) days' notice to pay to the City any delinquent ad valorem taxes due and unpaid -10- or fails to repay the City within ten (10) days any damages costs or expenses which the City is compelled to pay by reason of any act or default of the Company in connection with this franchise or fails after three (3j days notice of such failure by the City to comply with any provision of this franchise which the City reasonably determines can be remedied by demand on the letter of credit the City may immediately request payment of the amount thereof with interest and any penalties from the letter of credit Upon such request for payment the City shall notify the Company of the amount and date thereof d The rights reserved to the City with respect to the letter of credit are in addition to all other rights of the City 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 affect any other right the City may have e The letter of credit shall contain the following endorse- ment It is hereby understood and agreed that this letter of credit may not be cancelled by the surety nor the intention not to renew be stated by the surety until sixty (60) days after re- ceipt by the City by registered mail a written notice of such intention to cancel or not to renew SECTION 14 CONSTRUCTION BOND a Within thirty (30) days after the award of this franchise the Company shall obtain and maintain at its cost and expense and file with the City Secretary a corporate surety bond in a company authorized to do business in the State of Texas and found acceptable .~- ~-k -T1- by the City Attorney in the amount of One Million Dollars ($1 000 OUO 00) to guarantee the timely construction and full activation of the System The bond shall provide but not be limited to the following condition There shall be recoverable by the City jointly and severally from the principal and surety any and all damages loss or costs suffered by the City resulting from the failure of the Company to satisfactorily complete and fully activate the System throughout the franchise area where the System will be initially available to subscribers pursuant to the terms and conditions of Article II Section 3 of this ordinance b Any extension to the prescribed time limit must be autho- rized by the Council Such extension shall be authorized only when the, Council finds that such extension is necessary and appropriate due to causes beyond the control of the company c The construction bond shall be terminated only after the Council finds that the company has satisfactorily completed initial construction and activation of the System as set out in the Map and Plan submitted pursuant to Article II Section 3a(1) In addition after seventy-five (75) percent of the initial construction has been completed and activated the bond may be reduced to Five Hundred Thousand ($500 000 00) Dollars d The rights reserved to the City with respect to the con- struction bond are in addition to all other rights of the City whether reserved by this ordinance or authorized by law and no action proceeding or exercise of a right with respect to such construction bond shall effect any other rights the City may have -12- e The construction bond shall contain the following endorse- meat It is hereby understood and agreed that this bond may not be cancelled by the surety nor the intention not to renew be stated by the surety until sixty (60) days after receipt by the City by registered mail a written notice of such intent to-cancel or not to renew SECTION 15 INDEMNITY The Company agrees to indemnify defend and save harmless the City its officers and employees against and from any and all claims suits actions damages judgments expenses or costs by or on behalf of any person firm corporation arising from the conduct of or management of the franchise or from any occurrence in connection with the franchise and from any and all claims arising from any breach or default on the part of the Company in the performance of any covenant or agreement on the part of the Company to be performed pursuant to the terms of this agreement or arising from any act of negligence of the Company or any of its agents contractors or subcontractors servants employees or licensees and from and against all cost counsel fees expenses and liabili- ties including the reasonable value of any services rendered by the City Attorney his assistants or employees or agents of the City incurred in or about any claim or proceeding brought thereon SECTION 16 LIABILITY INSURANCE a The Company shall maintain throughout the term of the franchise liability insurance with an insurance company licensed to do business in the State of Texas in the minimum amount of -13- ,~ $1 000 000 00 insuring against claims for liability or damages Liability insurance under this section shall be for the protection of the public in connection with 1 Liability to persons or damages to property in any r` way arising out of or through the acts or omissions of Company its servants agents or employees or to which Company s negligence shall in any way contribute 2 Arising out of any claim for invasion of the right of privacy for defamation of any person firm or corporation or the violation or infringement of any copyright trademark trade name, service mark or patent or of any other right of any person firm or corporation (excluding claims arising out of or relating to City programming) and 3 Arising out of Company s failure to comply with the ~.-- provisions of any federal state or local statute, ordinance or regulation applicable to Company in its business hereunder b The insurance policy obtained by the Company in compliance with this section must be approved by the City Attorney and such insurance policy along with written evidence of payment of required premiums shall be filed and maintained with the City Secretary during the term of the franchise and the liability limits may be changed from time to time as required by the City The Company shall immediately advise City Attorney of any litigation that may develop that would affect this insurance c All insurance policies maintained pursuant to this fran- chise shall contain the following endorsement -14- It is hereby understood and agreed that this insurance policy may not be cancelled by the surety nor the intention not to renew be exer- cised by the surety until thirty (30) days after receipt by the City by registered mail a written notice of such intention to cancel or not to renew d All insurance plans required by this section shall be endorsed as to make the City of Fort Worth a named insured under such policies SECTION 17 FAILURE OF CITY TO ENFORCE THIS FRANCHISE, NO WAIVER OF THE TERMS THEREOF The Company shall not be excused from complying with any of the terms and conditions of this franchise by any failure of the City upon any one or more occasions to insist upon or to seek compliance with any such terms or conditions SECTION 18 RIGHTS OF INDIVIDUALS a Company shall not deny service deny access or otherwise discriminate against subscribers channel users or general citizens on the basis of race color religion national origin or sex Company shall strictly adhere to the equal employment opportunity requirements of the FCC as expressed in Title 47 of the Code of Federal Regulations Subpart H Section 76 311 Company shall comply at all times with all other applicable federal state city and county laws and all exclusive and administrative orders relating to nondiscrimination Regarding subcontracting Company shall make a positive effort to use racial minorities women and other protected groups as subcontractors if available and qualified b No signals of a Class IV cable communications channel shall be transmitted from a subscriber terminal for purposes of -15- monitoring individual viewing patterns or practices without the express written permission of the subscriber The request for such permission shall be contained in a separate document with a promin- ent statement that the subscriber is authorizing the permission in full knowledge of its provision The authorization shall be revokable at any time by the subscriber without penalty of any kind whatsoever Such authorization is required for each type or classification of Class IV cable communication activity planned for the purpose provided however that the Company shall be entitled to conduct systemwide or individually addressed sweeps for the purpose of verifying system integrity controlling return-path transmission or billing for pay services c The Company or any of its agents or employees shall not without the specific written authorization of the subscriber involved sell or otherwise make available to any party (1) lists of the names and addresses of such subscribers or (2) any list which identifies the individual viewing habits of subscribers SECTION 19 PUBLIC NOTICE Minimum public notice in addition to that required by state law of any City public meeting relating to this franchise shall be by the Company notifying its subscribers of the meeting by announcement on at least one (1) channel of its System between the hours of 7 00 p m and 9 00 p m for five (5) consecutive days unless an emergency meeting has been called in which event announcements shall be run once daily prior to the meeting -16- SECTION 20 SEVERABILITY If any section subsection sentence clause phrase or portion of this ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction such portion shall be deemed a separate distinct and independent provision and such holding shall not affect the validity of the remaining portions thereof ARTICLE II CABLE COMMUNICATION SYSTEM EXTENSION OPERATION STANDARDS AND PROCEDURES SECTION 1 SERVICE AVAILABILITY AND RECORD REQUEST The Company shall provide cable communication service which is modern and efficient throughout the entire franchise area pursuant to the provisions of this franchise and shall keep a record of all requests for service received by the Company This record shall be available for public inspection at the local office of the Company during regular office hours and shall be continously maintained to show at least the previous two (2) years of service requests SECTION 2 NEW DEVELOPMENTS The Company shall upgrade its facilities equipment and service so that its system is as advanced as the current state of technology will allow The Company shall install additional channel capacity as required to keep channel capacity in excess of the reasonable demand thereof by users At all times the cable system shall be no less advanced than any other system of comparable size excepting only systems which are experimental pilot or demonstration The City may order the Company to comply with this section in case of specific violation which it may investigate upon complaint or on its own motion -17- SECTION 3 CABLE COMMUNICATION SYSTEM CONSTRUCTION a Construction Map and Schedule (1) Map and Plan (Exhibit A) Company has submitted a construction plan which is incorporated herein by reference and made a part hereof as Exhibit A The plan consists of a map of the entire franchise area and clearly delineates the following (a) The areas within the franchise area where the cable com- munication system will be initially available to subscribers (b) Areas within the franchise area where extension of the cable communication system cannot reasonably be done due to lack of present or planned development or other similar reasons are clearly identified on the map with the reasons for not serving such areas (c) The plan shall also describe by use of reference to census tract numbers the construction timetable showing which census tracts will be built and the year in which construction and system activation will occur for each census tract Construction schedules consistent with overall system design and sound engineering practice must be developed that commit the Company to simultaneously and progressively build throughout all areas of the City in each of the construction years The objective of this requirement is to permit fair access on a timely basis to all areas of the City regardless of marketing attractiveness (d) Any changes in the plan shall require approval by the City Council and must be filed with the City Secretary -18- (2) Public Inspection of Plan The plan shall be made available for public inspection during normal business hours at the main local office of Company (3) Early Construction and Extension Nothing in this section shall prevent the Company from con- structing the system earlier than planned However any delay in the system construction beyond the times specified in the plan report timetable shall require application to and consent by the Council (4) Commencement of Construction Construction in accordance with the plan submitted by Company shall commence as soon after the grant and acceptance of the fran- chise as is reasonably possible Failure to proceed expeditiously shall be grounds for revocation of this franchise Failure to pro- ceed expeditiously shall be presumed in the event construction is not substantially in compliance with construction schedule or has not commenced within twelve (12) months of the grant and acceptance of this franchise (5) Underground and Overhead Construction In all sections of the City where the cables wires or other like facilities of public utilities are placed underground the Company shall place its cables wires or other like facilities underground to the maximum extent that the existing technology reasonably permits the Company to do so If at any time the City determines that existing wires cables or other like facilities of public utilities anywhere in the City shall be changed. from an overhead to an underground installation the Company shall also at Company s sole expense convert its system to an underground installation -19- In areas of the City where electrical or telephone systems are installed on poles above ground the Company shall have the option of installing the system in like manner above ground or underground In the construction and maintenance of the system Company shall comply with all requirements and have all the duties and liabilities imposed upon any person engaging in the business of distribution of electrical energy or any person engaging in the operation of any telephone telegraph burglar alarm or fire alarm system business (6) Extension of System Company shall extend system upon request to any area not desig- nated for extension in Exhibit A when potential subscribers can be served by extension of system past occupied dwelling units equi- valent to a density of fifty (50) homes per mile of street In areas not initially served in the original plan submitted by the Company and which do not meet the density requirements outlined above Company shall provide upon the request of a potential subscriber desiring service an estimate of the costs required to extend service to the subscriber Company shall then extend service upon request of the potential subscriber according to the rate schedule Company may require advance payment or assurance of payment satisfactory to Company The amount paid by subscriber for such extension shall be nonrefundable In cases of new construction or property development where utilities are to be placed underground the developer or property owner shall give Company reasonable notice of such construction or development and of the particular data on which open trenching will -20- be available for Company s installation of conduit pedestals and/or vaults and laterals to be provided at Company s expense Company shall also provide specifications as needed for trenching Costs of trenching and easements required to bring service to the development shall be borne by the developer or property owner except that if company fails to install its conduit pedestals and/or vaults and laterals within five (5) working days of the date the trenches are available as designated in the notice given by the developer or property owner and the trenches are closed after the five day period the cost of new trenching is to be borne by Company Except for the notice of the particular date on which trenching will be available to Company any notice provided. to Company by City of a preliminary plat request shall satisfy the requirement of reasonable notice if sent to the local general manager or system engineer of Company prior to approval of the preliminary plat request Nothing herein shall be construed to prevent Company from serving areas not covered under this section upon agreement with ,, developers property owners or residents a Areawide Interconnection of Cable Communication Systems (1) Interconnection Required The Company shall interconnect access channels of the cable communication system with any or all other systems in adjacent areas upon the directive of the City Interconnection of systems. may be done by direct cable connection microwave satellite or other appropriate method (2) Interconnection Procedure Upon receiving the directive of the City to interconnect the Company shall immediately initiate -21- negotiations with the other affected system or systems in order that all costs may be shared equally among cable companies for both construction and operation of the interconnection link (3) Relief The Company may be granted reasonable extensions of time to interconnect or the City may recind its order to inter- connect upon petition by the Company to the City The City shall grant said request if it finds that the Company has negotiated in good faith and has failed to obtain an approval regarding cost of the interconnection that would not cause an unreasonable or unacceptable increase in subscriber rates (4) Cooperation Required The Company shall cooperate with any interconnection corporation regional interconnection authority or city county state and federal regulatory agency which may be hereafter established for the purpose of regulating financing or otherwise providing the interconnection of cable systems beyond yhe boundaries of the City (5) Initial Technical Requirements to Assure Future Intercon- nection Capability (1) All cable systems receiving franchises to operate with the City shall use the standard frequency allocations for television signals (2) All cable systems are required to use signal processors at the headend for each television signal (3) The City also urges franchisees to provide local origination equipment that is compatible throughout the area so that program materials can be shared by various systems SECTION 4 COMPANY SERVICES Company shall provide at least the following services a StandGrd Installation -22- Standard installation consisting of an aerial drop, not exceed- ing one hundred fifty (150) feet, from a single pole attachment to the customer's residence Drops in excess of one hundred fifty (150) feet, concealed wiring, and all underground drops shall be charged according to the rate schedule b Project Prewiring (1) Company shall provide service to prewired projects according to the terms and conditions and at such rates provided in the rate schedule (2) Company shall review and approve methods and materials, supply specification, technical assistance and material according to the rate schedule (3) Company shall prewire a project upon request according to rate schedule c Deposits The Company may require a deposit for materials and services according to the rate schedule d Additional Outlets The Company shall provide additional outlets as customers may request according to the rate schedule e Public and Nonprofit School and Colleges, Municipal Buildings and Public Libraries Company shall provide installation ,and service to nonprofit schools and colleges, municipal buildings and public libraries according to rate schedule f Transfers When a current customer moves from one address within the fran- chised area to a second address within the franchised area there is -23- no lapse in service, Company shall transfer service at a rate according to the rate schedule g Reconnection Company shall restore service to customers wishing restoration of service provided customer shall first satisfy any previous obligations owed h Relocation or Extension of Cable When a current customer requests that an extension or relocation of said customer's cable service be made, Company shall do so according to the rate schedule i Service Calls Company shall provide cable communication system repair service to customer's premises to test and repair service, but shall not engage in the television repair business SECTION 5 CONSTRUCTION AND TECHNICAL STANDARDS a Authorization to Commence Construction Within ninety (90) days of the granting of the franchise, the Company shall apply for all necessary governmental permits, licenses, certificates and authorizations b Compliance with Construction and Technical Standards Company shall construct, install, operate and maintain its system in a manner consistent with all laws, ordinances, construc- tion standards, governmental requirements, FCC technical standards, and detailed standards submitted by Company as part of its applica- tion, which standards are hereby incorporated by reference herein In addition, Company shall provide the City, upon request, with a -24- written report of the results of Company s annual proof of perfor- mance tests conducted pursuant to FCC standards and requirements c Additional Specifications Construction installation and maintenance of the City s cable communication system sha]_1 be performed in an orderly and workman- like manner All cables and wires shall be installed where possible parallel with electric and telephone lines Multiple cable configurations shall be arranged in parallel and bundled with due respect for engineering considerations Company shall at all times comply with (1) National Electric Safety Code as prepared by the Institute of Electrical and Electronics Engineers (2) National Electrical Code of the National Fire Protection Association - Pamphlet No 10 (3) Bell Telephone System s Code of Pole Line Construction (4) Requirements of City in regard to various electrical wiring necessary to the operation of City functions in- cluding but not limited to traffic control signaliza- tion street lighting fire lines and communications lines (5) Applicable FCC or other federal state and local regula- tions and (6) Applicable Texas Electric Service Company construction standards Radio frequency leakage shall be checked at reception locations for emergency radio services to prove no interference signal combinations are possible Stray radiation shall be measured adja- cent to any proposed aeronautical navigation radio sites to prove no interference to airborne navigational reception in the normal flight patterns FCC Rules and Regulations shall govern d Standby Power The Company shall maintain equipment capable of providing standby power for headend transportation and trunk amplifiers for a minimum of two hours -25- e Emergency Override The Company shall incorporate into its cable communication system the capability which will permit the City in times of emer- gency to override the audio portion of all channels simultaneously The Company shall designate a channel which will be used for emer- gency broadcasts of both audio and video The Company shall cooper- ate with the City in the use and operation of the emergency alert override system• SECTION 6 USE OF STREETS, SIDEWALKS AND EASEMENTS a Interference with Persons and Improvements The Company s system poles wires and appurtenances shall be located erected and maintained so that none of its facilities shall endanger or interfere with the lives of persons or interfere with any improvements the City may deem proper to make or unnecessarily hinder or obstruct the free use of the streets sidewalks easements or public property b Minimum Interference with Public Ways All transmission and distribution structures lines and equip- ment erected by the Company within the City shall be so located as to cause minimum interference with the proper use of streets alleys and other public ways and places and to cause minimum interference with the rights or reasonable convenience of property owners who adjoin any of the said streets alleys or other public ways and places c Restoration to Prior Condition In case of any disturbance of pavement sidewalk driveway or other surfacing the Company shall at its own cost and expense and -26- in a manner approved by the City replace and restore all paving sidewalk driveway or surface of any street or alley disturbed in as good condition as before said work was commenced and in ac- cordance with standards for such work set by the Director of Public Works d Relocation of the Facilities In the event that at any time during the period of this fran- chise the City shall lawfully elect to alter or change the grade of any street alley or other public ways the Company upon reasonable notice by the City shall remove or relocate as necessary its poles wires cables underground conduits manholes and other fixtures at its own expense e Interference with Utilities The Company shall not place poles or other fixtures where the same will interfere with any gas electric or telephone facilities traffic control signalization street lights fire lines or communications lines or obstruct or hinder in any manner the various utilities serving the residents of the City All such poles or other fixtures placed in any street shall be placed close to the line of the lot abutting on said alley then in such manner as not to interfere with the usual travel on said streets alleys and public ways f Easements All necessary easements over and under private property shall be the responsibility of the property owner requesting such service g Cooperation with Building Movers The Company shall on the request of any person holding a building moving permit issued by the City temporarily raise or -27- lower its wires to permit the moving of buildings The expense of such temporary removal raising or lowering of wires shall be paid by the person requesting the same and the Company shall have the authority to require such payment in advance The Company shall be given not less than forty-eight (48) hours advance notice to arrange for such temporary wire changes SECTION 7 SYSTEM MAINTENANCE STANDARDS a Maintenance of System The Company shall erect and maintain all parts of the system in good condition throughout the entire franchise period b Efficient Service and Repairs The Company shall render efficient service make repairs promptly and interrupt service only for good cause and for the shortest time possible Such interruptions insofar as possible shall be preceded by notice and shall occur during period of minimum system use c Interference with. Reception Company shall not allow its cable or other operations to inter- fere with television reception of persons not served by Company d The Company shall continue through the term of the fran- chise to maintain the technical standards and quality of service set forth in this ordinance Should 'the City find that the Company has failed to maintain these technical standards and quality of service and should it specifically enumerate improvements to be made the Company shall make such improvements Failure to make such improvements within three (3) months after written notice will -28- constitute a breach of a condition for which the remedy of Article III Section 6(d) is applicable SECTION 8 CONTINUITY OF SERVICE MANDATORY a It shall be the right of all subscribers to continue receiving service insofar as their financial and other obligations to the Company are honored In the event that the Company elects to overbuild rebuild modify or sell the system or the City gives notices of intent to terminate or fails to renew this franchise the Company shall act so as to ensure that all subscribers receive continuous uninterrupted service regardless of the circumstances In the event of a change of franchise or in the event a new operator acquires the system the Company shall cooperate with the City new franchisee or operator in maintaining continuity of service to all subscribers During such period Company shall be entitled to the revenues for any period during which it operates the System and shall be entitled to reasonable costs for its services when it no longer operates the System b In the event Company fails to operate the System for four (4) consecutive days without prior approval of the City or without just cause the City may at its option operate the System or designate an operator until such time as Company restores service under conditions acceptable to the City or a permanent operator is selected If the City is required to fulfull this obligation for the Company the Company shall reimburse the City for all reasonable costs or damages in excess of revenues from the System received by the City that are the result of the Company s failure to perform -29- SECTION 9 COMPLAINT PROCEDURE a During the term of this franchise and any renewal there- of the Company shall maintain within the City a local business office for the purpose of receiving and resolving all complaints regarding the quality of service equipment malfunctions and similar matters The office must be reachable by a local toll-free telephone call and provide the City with the name address and telephone number of a person who will act as the Company s agent to receive complaints from subscribers during normal business hours and in no event less than 9 00 a m to 5 00 p m Monday through Friday excluding legal holidays Company shall provide the means to accept complaint calls twenty-four (24) hours a day seven days a week Any service complaints from subscribers shall be investigated and acted upon as soon as possible Any service complaint shall be resolved within three (3) working days Upon request by a sub- scriber the Company shall credit a subscriber s account on a pro- rata basis for loss of service commencing forty-eight (48) hours after notification The Company shall keep a maintenance service log which will indicate the nature of each service complaint the date and time it was received the disposition of said complaint and the time and date thereof This log steal]. be maintained for two years and shall be made available for periodic inspection by City b As subscribers are connected or reconnected to the system the Company shall by appropriate means such as a card or brochure furnish information concerning the procedures for making inquiries or complaints including the name address and local telephone -30- number of the employee or employees or agent to whom such inquiries or complaints are to be addressed and furnish information concerning the City office responsible for administration of the franchise with the address and telephone number of the office c When there have been similar complaints made or where there exists other evidence which in the judgment of the City casts doubt on the reliability or quality of cable service the City shall have the right and authority to require Company to test analyze and report on the performance of the System Company shall fully cooperate with City in performing such testing and shall prepare results and a report if requested within thirty (30) days after notice Such report shall include the following information (1) The nature of the complaint or problem which precipitated the special tests (2) What system component was tested (3) The equipment used and procedures employed in testing (4) The method if any in which such complaint or problem was resolved (5) Any other information pertinent to said tests and analysis which may be required City may require that tests be supervised at Company s ex- pense by a professional engineer not on the permanent staff of the Company The engineer should sign all records of special tests and forward to the City such records with a report interpreting the results of the tests and recommending actions to be taken The City s right under this action shall be limited to requir- ing tests analyses and reports covering specific subjects and -31- characteristics when the City has reasonable grounds to believe that{ said tests are necessary and useful in order to protect the public against substandard cable service SECTION 10 COMPANY RULES ANll REGULATIONS The Company shall have the authority to promulgate such rules regulations terms and conditions governing the conduct of its business as shall be reasonably necessary to enable the Company to exercise its rights and perform its obligations under this fran- chise and to assure an uninterrupted service to each and all of its customers provided however that such rules regulations terms and conditions shall not be in conflict with the provisions hereof or applicable federal state and local laws rules and regulations SECTION 11 TRANSFER OF OWNERSHIP OR CONTROL a This franchise shall not be assigned or transferred either in whole or in part or leased sublet or mortgaged in any manner nor shall title thereto either legal or equitable or any right interest or property therein pass to or vest in any person without the prior written consent of the City The proposed assignee must show financial responsibility as determined by the City and must agree to comply with all provisions of the franchise City shall be deemed to have consented to a proposed transfer or assignment in the event its refusal to consent is not communicated t in writing to Company with sixty (60) days following recQl°,pt of ~ .~ written notice of the proposed transfer or assignment b The Company shall promptly notify the City of any actual or proposed change in or transfer of or acquisition by any other party of control of the Company The word control as used herein -32- is not limited to major stockholders but includes actual working control in whatever manner exercised Every change transfer or acquisition of control of the Company shall make the franchise subject to cancellation unless and until the City shall have consented thereto which consent will not be unreasonably withheld For the purpose of determining whether it shall consent to such change transfer or acquisition of control the City may inquire into the qualification of the prospective controlling party and the Company shall assist the City in any such inquiry c The consent or approval of the City Council to any trans- fer of the Company shall not constitute a waiver or release of the rights of the City in and to the streets and any transfer shall by its terms be expressly subordinate to the terms and conditions of this franchise d In the absence of extraordinary circumstances the City will not approve any transfer or assignment of the franchise prior to completion of construction of proposed cable communication system as outlined in the construction plan (Exhibit A) e The City Council reserves the right to review the purchase price of any transfer or assignment of the cable system either in whole or in part and any assignee to this franchise expressly agrees that any negotiated sale value which the Council deems unreasonable will not be considered in the rate base for any subsequent request for rate increases f In no event shall a transfer of ownership or control be approved without successor in interest becoming a signatory to this franchise agreement -33- SECTION 12 OTHER PETITIONS AND APPLICATIONS Copies of all petitions applications communications and reports submitted by the Company to the Federal Communications Commission Securities and Exchange Commission or any other federal or state regulatory commission or agency having jurisdiction in respect to any matters affecting cable television operations autho- rized pursuant to the franchise shall be provided to City no later than the filing date for such petitions applications communica- tions and reports SECTION 13 FISCAL REPORTS The Company shall file annually with the Director of Finance no later than one hundred twenty (120) days after the end of the Company s fiscal year audited financial statements covering the operations of the Company within the confines of the City of Fort Worth These statements shall include a fiscal year-end balance sheet an income statement of retained earnings for the year a fixed asset statement showing for each account or category the original cost and accumulated depreciation balances and activity and a depreciation statement showing the detailed calculations of depreciation expense for the year These statements shall have been audited by an independent certified public accountant whose report shall accompany such statements and there shall be submitted along with them such other reasonable information as the City shall request with respect to the Company s properties and expenses relat- ed to its System operations within the City SECTION 14 REMOVAL OF SYSTEM At the expiration of the term for which this franchise is granted or upon its termination as provided herein Company shall -34- forthwith, upon notice by City, remove at its own expense all desig- nated portions of the System from all highways, sidewalks, ease- ments, dedications and public property with the City If Company fails to do so, City may perform the work at Company's expense A bond shall be furnished by Company in an amount sufficient to cover this expense SECTION 15 REQUIRED SERVICES AND FACILITIES The City and Company shall enter into a franchise agree- ment describing in detail all premises, services, facili- ties, design capabilities (actual and future), channel offerings, access channels, local production facilities, institutional network, etc , so that misunderstanding about these matters will be minimized and that promises become enforceable SECTION 16 PROHIBITED ACTIVITIES in the conduct of the business franchised hereunder, neither the company nor its officers, employees or agents shall directly or indirectly sell, lease repair, install or maintain or recommend for sale, lease, repair or maintenance television sets provided, how- ever, that nothing hereunder shall prohibit Company, at customer's request and without payment, from examining and adjusting customer's receiver set to determine whether reception. difficulties originate in the set or in the Company's System ARTICLE III ADMINISTRATION AND REGULATION SECTION 1 RULES AND REGULATIONS a In addition to the inherent powers of the City to regulate and control this franchise, and those powers expressly reserved by -35- the City or agreed to and provided for herein the right and power is hereby reserved by the City to promulgate such additional regulations as it shall find necessary in the exercise of is lawful powers and in furtherance of the terms and conditions of this franchise b The City may also adopt such regulations at the request of Company upon application SECTION 2 RECORDS, REPORTS AND INVESTIGATIONS a The Company shall keep complete and accurate books of account and records of its business and operations under and. in connection with this ordinance All such books and records shall be made available at the Company s principal office in the City b (1) The City shall have the power to require that the Company report to the City such information relating to the Company and/or the Company s affiliates as the City may consider useful in the administraion of this ordinance The City shall have the right to establish forms for all reports determine the time for reports and the frequency with which any reports are to be made and require that any reports be made under oath (2) The City shall have the right to require that all con- tracts or arrangements between the Company and any affiliated inter- est be in writing and that copies thereof be filed with the City c (1) The City shall have the right at reasonable times and for reasonable purposes to examine audit review and/or obtain copies of the papers books accounts documents maps plans and other records of the Company and/or the Company s affiliates and to -36- inspect inventory and/or appraise the plant equipment and other property of the Company within its jurisdiction The Company shall fully cooperate in making available its records and otherwise assisting in these activities (2) The City may at any time make inquiries concerned with the management and affairs of the Fort Worth System The Company shall respond to such inquiries on a timely basis SECTION 3 APPLICATION PROCEDURE Except as otherwise specifically provided for herein following the adoption and acceptance of this franchise all applications by the company for changes in rates services construction schedules transfer of ownership proposed changes in regulations or ordinances etc and as otherwise authorized by or made pursuant to this franchise shall be made and processed according to the following procedure a Applications shall be in a form containing sufficient facts and information acceptable to the City b An application may be rejected for inadequacy by City if it contains an inadequate description of what is being applied for is not in an acceptable form or contains insufficient facts and information for adequate consideration c A rejection of an application for inadequacy shall be in writing by notice which shall state the deficiencies The notice shall not be construed to limit further and different deficiencies on subsequent applications d Upon acceptance within a reasonable time consistent with law the City shall review the application and shall afford the -37- Company a fair .hearing with reference to the application and shall either approve or disapprove the proposed changes or make such order as may be reasonable e In order to ascertain any and all facts the City shall have full power and authority to inspect or cause to be inspected the books of the Company and to inventory and appraise or cause to be appraised the property of the Company and to compel the attendance of witnesses and the production of books and records Failure of Company to so cooperate or Company s unreasonable delay in providing information and documents shall be grounds for a rea- sonable extension by the City of the study period or if either the lack of cooperation or the delay substantially impairs the study the City may summarily deny the application SECTION 4 PERFORMANCE EVALUATION SESSIONS a The City and the Company shall hold scheduled performance evaluation sessions within thirty (30) days of the fifth and tenth anniversary dates of the Company s award of the franchise and as required by federal and state law All such evaluation sessions shall be open to the public b Special evaluation sessions may be held at any time during the term of the franchise at the request of the City or the Company c All evaluation sessions shall be open to the public and Company shall notify its subscribers of all evaluation sessions by announcement on at least one (1) channel of its System between the hours of 7 00 p m and 9 00 p m for five (5) consecutive days preceding each session -38- d Topics which may be discussed at any scheduled or special evaluation session may include but not be limited to service rate structures franchise fee penalties free or discounted services application or new technologies system performance services provided programming offered customer complaints privacy amendments to this ordinance judicial and FCC rulings line exten- sion policies and Company or City rules e During a review and evaluation by City Company shall fully cooperate with City and shall provide such information and documents as City may need to reasonably perform the review SECTION 5 RATE SETTING a Following the adoption of this franchise City shall adopt by ordinance a schedule for maximum rates for services which Company may charge No rate shall be set lower than the rate set for such services in the initial ordinance except with the consent of Company b Company may make application for a revision of the rate schedule at any time after two years from the date of initially providing cable communications service or until Company has com- pleted all construction as indicated in its application for first and second years whichever is longer c An application for an increase in the schedule of rates shall be filed in accordance with Section 3 of this Article The application shall be supported by statistical and other proof indi- cating that the existing rate is inadequate and unreasonable and that the proposed increases therein are required to enable the Com- pany to render service to fulfill its obligations under this ordin- ance and to derive a reasonable profit therefrom -39- The Company s petition for a rate increase shall include the following financial reports which shall reflect the operations of the Fort Worth System only (1) Balance sheet (2) Income statement (3) Statement of Sources and Applications of Funds (4) Detailed supporting schedules of expenses income assets and other items as may be required (5) Statement of current and projected subscribers and pene- tration and (6) Cash Flow Statement The Company s accounting records applicable to the Fort Worth System shall be available for inspection by the City at all reason- able times The City shall have access to records of financial transactions for the purpose of verifying burden rates or other indirect costs prorated to the Fort Worth operation The documents listed above shall include sufficient detail and/or footnotes as may be necessary to provide the City with the information needed to make accurate determination as to the financial condition of the System All financial statements shall be certified as accurate by an officer of the Company The City shall consider inter alia the following factors in approving or disapproving the petition (1) the ability of the Company to render System services and to derive a reasonable profit therefrom under the existing rate schedule and under the proposed rate schedule (2) the revenues and profits derived from System services (3) the efficiency of the Company (4) the quality of the service offered by the Company (5) the original cost of the System when initially placed in service less depreciation (6) a fair rate of return with respect to the cost of borrow- ing and the rates of return on investments having similar risks to that of cable communication (7) the extent to which the Company has adhered to the terms of this agreement and (8) fairness to City residents subscribers and users -40- The City shall not consider any valuation based upon this franchise or the Company s goodwill and these items of value shall neither be amortized as an expense nor shall a return be paid on them d Notwithstanding the provision of Rrticle III Section 3 any application by the Company for changes in rates only is subject to approval by the Council which approval shall not be unreasonably withheld SECTION 6 SUPERVISION OF THE FRANCHISE It is the intent of the City to provide day-to-day administra- tion and enforcement of the provisions of this franchise by delega- ting the responsibility to the Office of Cable Communications for the conduct of the City s responsibilities related to cable communication The Office of Cable Communications shall provide staff support to the citizens advisory cable board SECTION 7 PENALTIES For the violation of any of the following provisions of this franchise penalties shall be chargeable to the letter of credit as follows a For failure to complete system construction in accordance with the plan Exhibit A unless the Council specifically approves the delay by motion or resolution due to the occurrence of condi- tions beyond Company s control Company shall pay Two Hundred Dol- lars ($200 00) per day for each day or part thereof the deficiency continues -41- b For failure to provide data documents reports informa- tion or to cooperate with City during an application process or System review, Company shall pay Fifty Dollars ($50 00) per day each violation occurs or continues c For failure to test analyze and report on the performance of the System following a request pursuant to this franchise grantee shall pay to City Fifty Dollars ($50 00) per day for each day or part thereof that such noncompliance continues d Forty-five (45) days following adoption of a resolution of the Council determining a failure of Company to comply with operational or maintenance standards Company shall pay to City Two Hundred Dollars ($200 00) per day for each day or part thereof that such noncompliance continues e For failure to provide community origination channels and the necessary equipment and staff to activate them Company shall pay Two Hundred Dollars ($200 00) per day for each day or part thereof that such noncompliance continues f For failure to provide in a continuing manner the types of services proposed. in the accepted application Company shall pay Two Hundred Dollars ($200 00) per day for each day or part thereof that each noncompliance continues SECTION 8 FORFEITURE AND TERMINATION a In addition to all other rights and powers retained by the pity under this franchise or otherwise the City reserves the right to forefeit and terminate the franchise and all rights and privileges of the Company hereunder in the event of a substantial breach of its terms and conditions A substantial breach by Company shall include but shall not be limited to the following -42- (1) Violation of any material provision of the franchise or any material rule order regulation or determination of the City made pursuant to the franchise (2) Attempt to dispose of any of the facilities or property of its System to prevent the City from purchasing it as provided for herein (3) Attempt to evade any material provision of the franchise or practices any fraud or deceit upon the City or its subscribers or customers (4) Failure to begin or complete System construction or System extension as provided under the franchise as per Exhibit A (5) Failure to provide the types of services promised herein (6) Failure to restore service after ninety-six (96) consecu- tive hours of interrupted service except when approval of such interruption is obtained from the City or (7) Material misrepresentation of fact in the application for or negotiation of the franchise b The foregoing shall not constitute a major breach if the occurring violation is not the Company s fault or results from circumstances beyond the Company s control Company shall not be excused by mere economic hardship nor by misfeasance or malfeasance of its directors officers or employees c The City may make a written demand that the Company comply with any such provision rule order or determination under or pursuant to this franchise If the violation by the Company continues for a period of thirty (30) days following such written demand without written proof that the corrective action has been taken or is being actively and expeditiously pursued the City may place the issue of termination of the franchise before the City Council The City shall cause to be served upon Company at least twenty (20) days prior to the date of such a Council meeting a -43- written notice of intent to request such termination and the time and place of the meeting Public notice shall be given of the meeting and issue which the Council is to consider d The City Council shall hear and consider the issue and shall hear any person interested therein and shall determine in its discretion whether or not any violation by the Company has occurred e If the City Council shall determine the violation by the Company was the fault of Company and within its contro]_ the Council may declare that the franchise of the Company shall be forfeited and terminated or the Council may grant to Company a period for compliance SECTION 9 FORECLOSURE Upon the foreclosure or other judicial sale of all or a sub- stantial part of the System or upon the termination of any ].ease covering all or a substantial part of the System the Company shall notify the City of such fact and such notification shall be treated as a notification that a change in control of the Company has taken place and the provisions of this franchise governing the consent of the City Council to such change in control of the Company shall apply SECTION 10 RECEIVERSHIP The City Council shall have the right to cancel this franchise one hundred twenty (120) days after the appointment of a receiver or trustee to take over and conduct the business of the Company whether in receivership reorganization bankruptcy or other action -44- or proceeding unless such receivership or trusteeship shall have been vacated prior to the expiration of said one hundred twenty (120) days or unless a Within one hundred twenty (120) days after his election or appointment such receiver or trustee shall have fully complied with all the provisions of this ordinance and remedied all defaults thereunder and b Such receiver or trustee within said one hundred twenty (120) days shall have executed. an agreement duly approved by the court having jurisdiction in the premises whereby such receiver or trustee assumes and agrees to be bound by each and every provision of this ordinance and the franchise granted to the Company SECTION 11 BANKRUPTCY The Council shall have the right to cancel this franchise immediately should the Company liquidate become insolvent bank- rupt make a transfer for the benefit or creditors or reorganize and enter into an arrangement for the benefit of creditors or file a voluntary petition under any section or chapter of the National Bankruptcy Act as amended under any similar law or statute of the United States or state thereof or an involuntary petition in bankruptcy is filed against the Company and is not dismissed within one hundred twenty (120) days after the filing SECTION 12 COMPLIANCE WITH STATE AND FEDERAL LAWS Notwithstanding any other provisions of this franchise to the contrary the Company shall at all times comply with all laws and regulations of the state and federal government or any administra- -45- tive agencies thereof Provided however if any such state or federal law or regulation shall require the Company to perform any service or shall permit the Company to perform any service or shall prohibit the Company from performing any service in conflict with the terms of this franchise or of any law or regulation of the City then as soon as possible following knowledge thereof the Company shall notify the City Attorney of the point of conflict believed to exist between such regulation or law and the laws or regulations of the City or this franchise If the City Council determines that a material provision of this ordinance is affected by any subsequent action of the state or federal government the City Council shall have the right to modify any of the provisions herein to such reasonable extent as may be necessary to carry out the full intent and the purpose of this agreement In the event of deregulation by the FCC conformance to current FCC Rules and Regulations may continue to be required by the City ARTICLE IV PURCHASE OF CABLE COMMUNICATION SYSTEM BY CITY SECTION 1 RIGHTS TO PURCHASE In the event the Company forfeits and/or City terminates this franchise pursuant to provisions of this ordinance or at the normal expiration of the franchise term City shall have the right directly or as an intermediary to purchase the System SECTION 2 FRANCHISE VALUATION The value of the franchise shall be the aggregate of the re- placement value of tangible assets and the going concern value of the franchised System -46- SECTION 3 REPLACEMENT VALUE AND GOODWILL a Replacement value is defined as the cost of building a new and equally sized system using the latest technology and current costs less an allowance for the age anal condition of the present system b The going concern value shall mean the benefits that attach to the business as a result of its location in the City Company s reputation among franchise subscribers or potential sub- scribers for dependability and quality of service and any other circumstances resulting in probable retention of old subscribers or /i' ~acqu=isit_ion'~ f new subscribers except no value shall be assigned to either the franchise itself or any right privilege or expectancy arising to Company out of the right to transact business under the franchise and particularly no value shall be allowed for any increase in value arising out of any expectation of System revenues beyond the forfeiture and termination date or expiration date whichever is sooner SECTION 4 RELOCATION In the acceptance of this franchise Company expressly waives its rights if any to relocation costs that might otherwise be provided by law SECTION 5 DATE OF VALUATION The date of valuation shall be no earlier than the day follow- ing the date of expiration or termination and no later than the date City makes a fair and reasonable offer for the system or the date of transfer of ownership whichever occurs first -47- t SECTION 6 TRANSFER TO CITY Upon exercise of this option and the payment of the above sum by the City and its service of official notice of such action upon Company the Company shall immediately transfer to the City possession and title to all facilities and property real and per- sonal of the System free from any and all liens and encumbrances not agreed to be assumed by the City in lieu of some portion of the purchase price set forth above and the Company shall execute such warranty deeds or other instruments of conveyance to City as shall be necessary for this purpose SECTION 7 ARBITRATION OF VALUE AND COSTS a In the event City and Company cannot agree upon the value of the System either may give notice of a demand to the other for arbitration b Arbitration shall commence and proceed according to law except as follows (1) The parties shall within fifteen (15) days appoint one arbitrator each who is experienced and knowledgeable in the valuation of business property Arbitrators shall each agree upon the selection of a third arbitrator similarly qualified within fifteen (15) days (2) Within thirty (30) days after appointment of all arbitra- tors and upon ten (10) day s written notice to parties the board of arbitrators shall commence a hearing on the issue of valuation (3) The hearing shall be recorded and transcribed at the request of either party All hearing proceedings debate and deli- -48- berations shall be open to the public and at such times and places as contained in the notice or as thereafter publicly stated in the order to adjourn except as otherwise authorized by the City Attorney (4) At the close of the hearings and within thirty (30) days the board shall prepare findings and decision agreed upon by a majority of the board which shall be filed with the City and served by mail upon the Company Unless the parties extend by mutual agree- ment the time which the board has to make a decision the proceed- ings shall become null and void and shall be started anew (5) The decision of the board shall be final and binding upon the parties (6) Either party may seek judicial relief in the following circumstances (a) a party f"aifls ;.t"o .select an arbtr,ato.r, ~. (b) the arbitrators fail to select a third arbitrator (c) one or more arbitrator is unqualified (d) designated time limits have been exceeded (e) the board has not proceeded expeditiously and (f) based upon the record the board abused its discretion (7) In the event a court of competent jurisdiction determines the board has abused its discretion it may order the arbitration procedure repeated and issue findings orders and directions with costs of suit to be awarded to the prevailing party (8) Cost of arbitration shall be borne equally unless the board finds the offer of the City or the demand of Company was unreasonable in which case cost may be apportioned so that less or none of the costs may be borne by one party -49- ARTICLE V RENEWAL OF FRANCHISE SECTION 1 RENEWAL PROCEDURES a This franchise may be renewed by the City upon application of the Company pursuant to the procedure established in subsection b of this section and in accordance with the then applicable law b (1 ) At least fifteen ( 15 ) months prior to the exp~ratio~ of the franchise Company shall inform the City in writing of its intent to seek renewal of the franchise and thereupon file with the City a proposal for services (2) After giving public notice the City shall proceed to determine whether the Company has satisfactorily performed its obligations under the franchise To determine satisfactory perfor- mance the City shall consider technical developments and perfor- mance of the system programming other services offered cost of services and any other particular requirements set in the ordin- ance also the City shall consider the Company s proposal and its annual reports made to the City and the FCC industry performance on a national basis shall also be considered Provision shall be made for public comment (3) If based upon Company s performance during this franchise term the Company s new proposal and report thereon and the public hearings Council. finds a renewal of the franchise with the Company within the public interest Council may enter into a renewal of the franchise with Company under such terms and conditions and for an additional term of ten (10) years -50- (4) In the event the Company is determined by the City to have performed unsatisfactorily new applicants shall be sought and evaluated and a franchise award shall be made by the City Passed by the City Council of the City of Fort Worth on the ~~~ day of ~~~/~/~~/r/ 19 ~~ APPROVED AS TO FORM AND LEGALITY C~ `~~~F---'`- C ty Attorney ADOPTED ~q i--C~) /7, ~~~'/ EFFECTIVE ACCEPTANCE The Company accepts and hereby agrees to be bound by all the terms and conditions of this franchise Date ~~9,/21~N /~ //~/ SAMMONS OF FORT WORTH -51-