HomeMy WebLinkAboutOrd. 059 - Cable TV
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Final Franchise
Andover, Minnesota
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Prepared by:
Thomas D. Creighton
Dunkley and Bennett
1750 First Bank Place East
Pillsbury Center
200 South Sixth Street
Minneapolis, Minnesota 55402
(612) 339-1290
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TABLE OF CONTENTS
STATEMENT OF INTENT AND PURPOSE
FINDINGS
ARTICLE I. SHORT TITLE AND DEFINITIONS
Section 1. Short Title
Section 2. Definitions
ARTICLE II. GRANT OF AUTHORITY AND GENERAL PROVISIONS
Section 1. Grant of Franchise and Acceptance
Section 2. Authority Granted
Section 3. Agreement
Section 4. Franchise Term
Section 5. Area
Section 6. Police Powers
Section 7. Use of Grantee Facilities
Section 8. Written Notice
Section 9. Rights of Individuals
Section 10. Certificate of Confirmation
ARTICLE III. DESIGN OF SYSTEM
Section l. Channel Capacity-Subscriber Network
Section 2. Picture Quality and Technical
Requirements
Section 3. Two-Way Capacity
Section 4. Facilities
Section 5. Special Channel and Access
Requirements
(i)
Page
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3
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7
8
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9
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10
12
13
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15
15
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Section 6. Institutional Network 19
Section 7. Services to Public Buildings
and Educational Institutions 20
Section 8 . Interconnection 21
Section 9. Narrowcasting 21
Section 10. Regional Channel 21
ARTICLE IV. SERVICES AND PROGIDU.~ING, SUBSCRIBER
CONTRACTS, COMPLAINTS
Section 1. Services and Programming
22
Section 2. Interruption of Service and
Complaints
22
ARTICLE V. CONSTRUCTION, INITIAL SERVICE AREA,
LINE EXTENSION AND CONSTRUCTION STANDARDS
Section 1. Initial Service Area
Section 2. Line Extension Policy
Section 3. Construction Timetable
Section 4. Construction Standards
Section 5. Conditions on Use
25
25
26
28
31
ARTICLE VI. SYSTEM OPERATIONS
Section 1. Information Availability
33
Section 2. Service Contract
34
Section 3. Subscriber Practices
36
Section 4. Franchise Fees, Rates, Charges,
Changes in Fees and Procedures
38
A. Rate Change Procedures
38
B. Franchise Fee
38
C. Rates and Other Charges
39
(ii)
Page
D. Rate Changes
40
E. Periodic Reviews, Renegotiation
and Technological Update of
System 49
Section 5. Franchise Renewal
52
ARTICLE VII. (Reserved)
ARTICLE VIII. INDEMNIFICATION, INSURANCE, LETTER OF
CREDIT AND BOND
Section 1.
Section 2.
Section 3.
Section 4.
Section 5.
General
55
Indemnification and Insurance
55
Insurance
57
Letter of Credit
58
Bonds
63
ARTICLE IX. DEFAULT
Section 1. Notice and Default
65
Section 2. Cross Default
67
ARTICLE X. FORECLOSURE, RECEIVERSHIP AND ABANDONMENT
Section 1. Foreclosure
68
68
Section 2. Receivership
Section 3. Abandonment
69
ARTICLE XI. PURCHASE OF SYSTEM
Section 1. General
70
Section 2. Procedures
71
(iii)
Page
ARTICLE XII. MISCELLANEOUS
Section 1. Transfer of Ownership or Control
74
Section 2. Removal After Termination or
Revocation
77
Section 3. Work Performed by Others
78
Section 4. Interest Rate
79
Section 5. General Provision on Rights
and Remedies
79
Section 6. Applicable Laws and Court
Decisions: Severability
80
Section 7. Grantee Acknowledgment of
Validity of Franchise
81
ARTICLE XIII. ADMINISTRATION AND ADVISORY BODY
Section 1. Administrator
82
section 2. Advisory Body
82
Section 3. Delegation of Authority by City
82
ARTICLE XIV. JOINT SYSTEM, ACCEPTANCE, INCORPORATION
OF OFFERING, EXHIBITS, PUBLICATION
Section 1. Other Franchises 83
Section 2. Time of Acceptance; Guarantee;
Incorporation of Offering; Exhibits 83
(iv)
ORDINANCE NO. 59
AN ORDINANCE, INCLUDING ADDENDUM WITH EXHIBITS, GRANTING A FRAN-
CHISE TO TELEPROHPTER OF QUAD CITIES, INC., A MINNESOTA CORPORA-
TION, TO OPERATE AND MAINTAIN A CABLE COMMUNICATION SYSTEM IN THE
CITY; SETTING FORTH CONDITIONS ACCOMPANYING THE GRANT OF FRAN-
CHISE; PROVIDING FOR REGULATION, AND USE OF THE SYSTEM; AND PRE-
SCRIBING PENALTIES FOR THE VIOLATION OF ITS PROVISIONS
The City Council of the City of Andover ordains:
STATEMENT OF INTENT AND PURPOSE
The City intends, by the adoption of this Franchise, to
bring about the development of a System, and the continued opera-
tion of it. Such a development can contribute significantly to
the communication needs and desires of many. Further, the City
may achieve better utilization and improvement of public services
with the development and operation of a Cable Communications
System.
Past studies, participated in by City, have led the way for
organizing a means of procuring and securing a Cable Communica-
tions System deemed best suited to the City, in the judgment of
the Council. This has resulted in the preparation and adoption
of this Franchise.
FINDINGS
In the review of Grantee's proposal and application and as a
result of the public hearings, the City Council makes the follow-
ing findings:
A. The Grantee's technical ability, financial condition, legal
qualifications, and character were considered and approved
in a full public proceeding after due notice and reasonable
opportunity to be heard;
B. Grantee's plans for constructing and operating the System
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were considered and found adequate and feasible in a full
public proceeding after due notice and reasonable opportun-
ity to be heard;
C. The Franchise granted to Grantee by City complies with the
existing applicable Minnesota Statutes and regulations and
Franchise standards of Board; and
D. The Franchise granted to Grantee is nonexclusive.
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SECTION 1.
ARTICLE I.
SHORT TITLE AND DEFINITIONS
SHORT TITLE
This Ordinance shall be known and cited as the Cable Commun-
ications Ordinance.
SECTION 2. DEFINITIONS
For the purpose of the Franchise, 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. The words "shall" and "will" are man-
datory and "may" is permissive. Words not defined shall be given
their common and ordinary meaning.
A. "Basic Service" means all subscriber services provided by
Grantee including the delivery of broadcast signals, covered
by the regular monthly charge paid by all subscribers, ex-
cluding optional services for which a separate charge is
made.
B. "Board" means the Hinnesota Cable Communications Board.
C. "City" means City of Andover, a municipal corporation, in
the State of Minnesota.
D. "Class IV Channel" means a signaling path provided by a Sys-
tem to transmit signals of any type from a subscriber ter-
minal to another point in System.
E. "Converter" means an electronic device, which converts sig-
nals to a frequency acceptable to a television receiver of a
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subscriber, and by an appropriate channel selector permits a
subscriber to view all subscriber signals included in the
service.
G. "Council" means the governing body of the City.
H. "Drop" shall mean the cable that connects the subscriber
terminal to the nearest feeder cable of the system.
I. "FCC" shall mean the Federal Communications Commission and
any legally appointed, designated or elected agent or suc-
cessor.
J. "Grantee" is Teleprompter of Quad Cities, Inc., a Minnesota
Corporation, its agents or employees.
K. "Gross Revenues" shall mean all revenue derived directly or
indirectly by Grantee, its affiliates, subsidiaries, parent,
and any person in which Grantee has financial interest of
five percent (5%) or more from or in connection with the
operation of the System, including but not limited to, basic
subscriber service monthly fees, pay cable fees, installa-
tion and reconnection fees, leased channel fees, converter
rentals, studio rental, production equipment and personnel
fees, and advertising revenues. The term does not include
any taxes on services furnished by Grantee and imposed di-
rectly upon any subscriber or user by the State, City or
other governmental unit and collected by Grantee on behalf
of said governmental unit or any revenues derived from a
feed originating in or passing through City and destined for
a location outside City.
L. "Installation" means the connection of the System from
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feeder cable to the point of connection.
M. "Lockout Device" is an optional mechanical or electrical
accessory to a subscriber's terminal which .inhibits the
viewing of a certain program, certain channel or certain
channels provided by way of the cable communications system.
N. "Offering of Grantee" or "Offering" shall mean that certain
document dated August 19, 1981, entitled "Application for
Cable Television Franchise" and signed by Grantee, which
o.
"Public Property" is any real property owr
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document is on file with the City Clerk.
than a Street.
P.
"Scrambler/Descrambler" refers respectively
installed in the cable communication system >; ueaaena equip-
ment and subscriber terminal used to isolate pay cable and
other ancillary service channels from basic service which is
accomplished l:5y electronically distorting the signal prior
to its transmission through the cable communications system
and reconstitituting the signal at each authorized location
for subsequent display.
Q. "Sidewalk" is the portion of a street delineated for pedes-
trian travel.
R. "Street" shall mean the surface of and the space above and
below any public street, road, highway, freeway, lane, path,
public way, alley, court, sidewalk, boulevard, parkway,
drive or any easement or right-of-way now or hereafter held
by City which shall, within its proper use and meaning in
the sole opinion of City, entitle Grantee to the use thereof
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for the purpose of installing or transmitting over poles,
wires, cables, conductors, ducts, conduits, vaults, man-
holes, amplifiers, appliances, attachments and other prop-
erty as may be ordinarily necessary or pertinent to a
System.
S. "Subscriber" means any person or entity who subscribes to a
service provided by Grantee by means of or in connection
with the System regardless of whether a fee is paid for such
service.
T. "System" means a system of antennas, cables, wires, lines,
towers, waveguides or other conductors, converters, equip-
ment or facilities, designed and constructed for the purpose
of producing, receiving, transmitting, amplifying and dis-
tributing, audio, video and other forms of electronic or
electrical signals, located in City. Said definition shall
not include any system wholly internal to one or more mul-
tiple unit dwellings under common ownership, control or man-
agement, and which does not use City streets or other public
property. In any event, system as defined herein shall not
be inconsistent with the definition as set out in the rules
of the Board.
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ARTICLE II.
GRANT OF AUTHORITY AND GENERAL PROVISIONS
SECTION 1. GRANT OF FRANCHISE AND ACCEPTANCE
City hereby grants to Grantee, to be effective upon certifi-
cation by Board, a nonexclusive franchise subject to all of the
terms and conditions as herein provided:
A. Grantee shall accept this Franchise in the following manner,
and not later than the time set out in Article XIV, Section
2 :
(1) This franchise will be properly executed and acknowl-
edged by Grantee and delivered to City.
(2) At the same time as delivery of the executed Franchise,
Grantee shall deposit with City its nonrefundable ac-
ceptance fee in the sum of $14,000.00, for the purpose
of defraying the costs and expenses of developing this
Franchise and for the enforcement and administration
costs to be incurred until Franchise fees may be real-
ized. After the initial payment of the acceptance fee,
should costs in excess of the acceptance fee be in-
curred by City prior to the payment of the first Fran-
chise fee, City may charge such excess costs ~o Grantee
and Grantee sha 11 pay them on demand by City, as an
advance on the payment of Franchise fees.
(3) All security deposits, Letters of Credit, certificates
of insurance, acceptances, bonds, attorneys' opinions,
organizational and creation documents and guarantees
requirco of Grantee by this Franchise, shall be de-
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livered with the executed Franchise and in accordance
therewith.
SECTION 2.
AUTHORITY GRANTED
A. City grants to Grantee the permission to use streets for
erecting, constructing, operating and maintaining the
System. Other rights necessary for the System on other pub-
lic or private property must be obtained by Grantee, but
City shall have no obligation to give or grant or assist in
obtaining the same.
B. Grantee shall construct and maintain the System so as not to
interfere with other uses of streets. Grantee shall make
use of existing poles and other facilities available to
Grantee.
C. Notwi thstanding the above grant to use streets, no street
shall be used by Grantee if City in its sole opinion deter-
mines that such use is inconsistent with the terms, condi-
tions or provisions by which such street was created or ded-
icated, or presently used.
SECTION 3. AGREEMENT
A. Grantee agrees to be bound by all the terms and conditions
of this Franchise.
B. The Grantee also agrees to provide all services specifically
set forth in, and to comply with all provisions of, its
Offering to provide a System within the boundaries of City.
Further, failure of Grantee to provide a System as described
in its Offering, at City's option, shall be a violation of
the provisions of this Franchise. In the event of conflicts
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or discrepancies between the Offering of Grantee and the
provisions of this Franchise, the provisions which provide
the greatest benefit to City, in the opinion of the Council,
shall prevail.
SECTION 4. FRANCHISE TE~l
This Franchise shall commence upon acceptance by Grantee and
shall expire fifteen (15) years from date of acceptance.
SECTION 5. AREA
This Franchise is granted for City as it exists from time to
time during the term of this Franchise.
SECTION 6. POLICE POWERS
A. Grantee's rights are subject to the police power of City to
adopt and enforce ordinances necessary to the health, safety
and welfare of the public.
B. Any conflict between the provisions of this Franchise and
any other present or future lawful exercise of police powers
of City shall be resolved in favor of City.
SECTION 7. USE OF GRANTEE FACILITIES
City shall have the right to install and maintain, free of
charge, upon the poles and within the underground pipes and con-
duits of Grantee any wires and fixtures desired by City. Grantee
waives any claim against City arising from City I S exercise of
these rights.
SECTION B. WRITTEN NOTICE
All notices, reports or demands required to be given in
writing under this Franchise shall be deemed to be given when
delivered personally to any officer of Grantee or City's
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Administrator of this Franchise or 48 hours after it is deposited
in the United States Mail in a sealed envelope, with registered
or certified mail postage prepaid thereon, addressed to the party
to which notice is being given, as follows:
If to City:
C~^ty of Andover
1~85 Crosstown Blvd. N.W.
Andover, Minnesota 55303
If to Grantee: Teleprompter of Quad Cities, Inc.
924 F & M Bank Building
Minneapolis, Minnesota 55402
Attn: System Manager
Hith Copy to: Group W Cable, Inc.
888 Seventh Avenue
New York, New York 10106
Attn: Vice-President and
General Counsel
Such addresses may be changed by either party upon notice to the
other party given as provided in this section.
SECTION 9.
RIGHTS OF INDIVIDUALS
A. No signals, including signals of a Class IV Channel, shall
be transmitted from a subscriber terminal except as required
to provide a service authorized by this Franchise and the
subscriber. Grantee and any other person shall neither ini-
tiate nor use any procedure or device for monitoring indi-
vidual viewing patterns or practices or otherwise procuring
or storing or selling information or data from a subscrib-
er's terminals or terminal by any other means, without the
prior authorization of the affected subscriber which shall
not have been obtained from the subscriber as a condition of
service.
The request for such authorization shall be con-
tained in a separate document which prominently states that
the subscriber is authorizing with full knowledge of the
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authorization provisions and which identifies the purpose
for which the data or information is being gathered or
stored. Such authorization shall be for a limited period of
time not to exceed one year. The authorization shall be
revocable at any time by the subscriber without penalty of
any kind whatsoever. A separate authorization shall be re-
quired for each type of classification of data or informa-
tion sought from a subscriber terminal.
B. Grantee shall not, without the written authorization of the
affected subscriber, provide to anyone data identifying or
designating any subscriber. Any data authorized shall be
made available upon request by and without charge to the
authorizing subscriber in understandable fashion, including
specification of the purpose for which the information is
being gathered and to whom and for what fee the information
is to be sold.
C. Grantee shall not tap or monitor, arrange for the tapping or
moni toring, or permit any other person to tap or monitor,
any cable, line, signal input device, or subscriber outlet
or receiver for any purpose whatsoever, without the prior
written authorization of the affected subscriber as required
by paragraph A of this section.
D. Nothing herein contained shall prohibit Grantee from verify-
ing System operation and the transmission of signals to an
affected subscriber or from monitoring for the purpose of
billing. The confidentiality of the information obtained in
this subsection shall be subject to the provisions of this
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section.
SECTION 10.
CERTIFICATE OF CONFIRMATION
Grantee shall abide by the then current rules and regula-
tions of Board regarding the application, approval, and renewal
of a Certificate of Confirmation. Failure of Grantee to obtain a
Certificate of Confirmation or a renewal thereof shall result in
automatic termination of this Franchise, and this Franchise shall
cease to be of any force or effect. However, Grantee may operate
the System while the Board is considering an application for re-
newal of the Certificate of Confirmation.
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ARTICLE III.
DESIGN OF SYSTEM
SECTION 1. CHANNEL CAPACITY - SUBSCRIBER NETWORK
A. The 400 mHz System shall be capable of providing 52 down-
stream channels, four fully activated upstream channels and
a full-video information retrieval channel. The system
shall provide access to information data bases with the
capacity of such data bases to be 250,000 pages.
B. The System shall provide three tiers of subscriber service.
Tier I shall be a 25 video channel mini-basic service tier.
Tier 2 shall be a 48 video channel basic service tier.
Tier 3 shall be a 52 video channel interactive service.
SECTION 2. PICTURE QUALITY AND TECHNICAL REQUIREMENTS
A. The System shall produce a picture upon each subscriber's
television screen in black and white or color, depending
upon whether color is being telecast and provided the sub-
scriber's television set is capable of producing a color
picture, that is not materially distorted and free from
ghost images, without material degradation of color fidel-
ity. The System shall produce a sound that is not materi-
ally distorted on any receiver of a subscriber. Grantee, at
its expense, shall install and maintain the System so as not
to interfere with any subscriber's ability to receive local
broadcast stations.
B. The System shall transmit or distribute signals to all tele-
vision and radio receivers of all subscribers without caus-
ing unreasonable crossmodulation in the cables or
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unreasonably interfering with other electrical or electronic
systems or the reception of other television or radio
receivers.
C. Grantee shall construct and maintain a System that at least
meets minimum technical standards now or hereafter promul-
gated by the FCC relating to cable communication systems;
provided, however, that in no event shall the technical
standards required to be met by Grantee be less stringent
than the FCC standards in effect at the time of the adoption
of the Ordinance, nor shall Grantee be required to meet min-
imum FCC technical standards which apply solely to cable
communications systems for which franchises are granted sub-
sequent to the acceptance of this Franchise. The FCC tech-
nical standards relating to cable communications systems
contained in subpart K of part 76 of the FCC rules are
hereby incorporated by reference and made a part hereof.
D. The System shall be designed for and operated on a 24 hours
a day continuous operation basis.
E. Grantee shall initially and subsequently test the technical
capacity of the System according to the procedures delineat-
ed in the Offering. Additionally, Grantee agrees to allow
City to select a consultant if City deems it is necessary to
review and perform such testing procedure. The results of
any tests required by the FCC shall be filed within ten days
of the conduct of such tests with the City and the Board.
Other representatives of City may be present during testing.
Tests may be done annually at such times as is determined by
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City, with notice to Grantee. The expenses of any tests
required by the FCC shall be paid by Grantee. The expenses
of tests required by City in addition to FCC required tests
shall be paid by City from the Franchise fee. Should the
tests show System to be not in compliance with this Fran-
chise, Grantee shall pay upon demand of City all expenses
associated with City required tests.
SECTION 3. TWO-WAY CAPACITY
Grantee shall initially activate and thereafter maintain a
two-way capable System (audio, video and data impulse). Grantee
shall fully activate four upstream channels at the time of System
activation. This will include fully interactive service
capability supported by addressable, state-of-the-art equipment.
SECTION 4. FACILITIES
The Grantee shall construct, maintain and continue to pro-
vide all facilities and equipment set forth in the Offering in-
cluding, but not limited to, the headend, hubs, distribution sys-
tem, studios, equipment and other facilities. Grantee's plan, as
set forth in the Offering, for implementing the construction,
utilization, System performance, and maintenance of these facili-
ties, including its plans for accomodating future growth and
changing needs and desires, shall be fully and timely performed.
SECTION 5. SPECIAL CHANNEL AND ACCESS REQUIREMENTS
A. Grantee will carry broadcast stations in accordance with FCC
rules as from time to time revised.
B. Channel 10 (the Government access channel) shall be dedicat-
ed as an emergency override channel operated by City.
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C. Grantee will provide an audio/video emergency alert override
system that will permit the interruption by designated City
officials of all audio (including FM) and video programming,
instructing citizens to switch to Channel 10 for emergency
announcements.
D. Grantee shall provide at least eight (8) channels for access
use (including one for each of the following uses: public,
educational, government, leased, regional, religious chan-
nel, senior citizens access, and library access). All resi-
dential subscribers who receive all or any part of the total
services offered on the System shall also receive all of
said eight (8) access channels at no additional charge.
These channels shall be activated upon System activation and
thereafter maintained. Grantee shall establish rules and
regulations prior to Systen activation for the use of access
channels which shall be approved by City before implementa-
tion and thereafter shall not be altered or amended without
approval of City. In preparing such rules:
(1) Grantee shall provide an equal opportunity for use of
access services.
(2) Grantee will consider needs assessments prepared by
City.
(3) Grantee will comply, at a minimum, with the require-
ments of City and the Board now or hereafter adopted or
determined by City or the Board regarding access chan-
nels. Such requirements of the Board are hereby made a
part of this ordinance and include the following:
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(a) Grantee shall, to the extent of the System's
available channel capacity, provide to each of its
subscribers who receive all or any part of the
total services offered on the System, reception on
at least one specially designated noncommercial
public access channel available for use by the
general public on a first come, nondiscriminatory
basis; at least one specially designated access
channel for use by local educational authorities;
at least one specially designated access channel
for local government use; and at least one spe-
cially designated access channel available for
lease on a first come, nondiscriminatory basis by
commercial and noncommercial users (the preceding
hereinafter referred to as the "access channels").
Subscribers receiving only alarm system services
or only data transmission services for computer
operated functions shall be exempt from this re-
quirement. The VHF spectrum shall be used for at
least one of the specially designated noncommer-
cial public access channels required. No charges
shall be made for channel time or playback of pre-
recorded programming on at least one of the spe-
cially designated noncommercial public access
channels. Any fees for use of public access chan-
nels shall be consistent with the goal of afford-
ing the public a low cost means of television
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access. Access facilities, equipment and/or chan-
nel time will be made available to the general
public, any group or individual resident in City
for the production and/or cablecasting of
noncommercial programming free of charge on a
first corne, nondiscriminatory basis.
(b) Whenever any of the access channels is in use
during 80 percent of the weekdays (Monday-Friday),
for 80 percent of the time during any consecutive
three hour period for six weeks running, and there
is demand for use of an additional channel for the
same purpose, Grantee shall then have six months
in which to provide a new specially designated
access channel for the same purpose at no addi-
tional cost to subscribers, provided that provi-
sion of such additional channel(s) shall not
require the cable system to install converters.
(c) The rules and regulations established by the
Grantee and approved by City governing the access
channels shall be filed with the Board within 90
days after any such channels are put into use.
(d) Subscribers receiving programs on one or more spe-
cial service channels without also receiving the
regular subscriber services may receive only one
specially designated composite access channel
composed of the programming on access channels.
This composite channel shall not include program-
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ming from the leased access channel. Subscribers
receiving only alarm system services or only data
transmission services for computer operated func-
tions shall not be included in this requirement.
(4) The Grantee shall comply, at a minimum, with the re-
quirements of City and Board, now or hereafter adopted
by City or Board regarding public use of its equipment,
including but not limited to the following:
(a) Grantee shall make readily available for public
use at least minimal equipment necessary for the
production of programming and playback of prere-
corded programs for the specially designated non-
commercial public access channel. The Grantee
shall also make readily available upon need being
shown, the minimum equipment necessary to make it
possible to record programs at remote locations
with battery operated portable equipment.
(b) Need within the meaning of this paragraph shall be
determined by subscriber petition. Said petitions
must contain the signatures of at least 10 percent
of the subscribers of System, but in no case more
than 500 nor fewer than 100 signatures.
SECTION 6. INSTITUTIONAL NETVI0RK
The System shall include a separate institutional cable com-
munications network, interconnected with the subscriber network,
which will permit 38 separate television channels to be sent to
each institution and 16 channels to be returned from each insti-
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tution to the head-end for redistribution.
Said institutional
network shall be offered, activated, expanded, marketed, and
developed at a minimum in full compliance with the Offering.
determined in the sole discretion of City.
Need for the provision of institutional service shall be
SECTION 7.
INSTITUTIONS
SERVICE TO PUBLIC BUILDINGS AND EDUCATIONAL
Grantee shall provide, at a minimum, institutional network
service to:
Anoka Senior High
Anoka State Hospital
Anoka Vo-Tech Institute
Anoka Fred Moore Junior High
Anoka Sandberg Middle School
Anoka Franklin Elementary School
Anoka Lincoln Elementary School
Anoka Wilson Elementary School
Anoka Washington Elementary School
Anoka St. Stephen's
Anoka City Hall
Anoka Court House
Anoka Fire Station
Anoka City Library
Landscape Career Center
(Anoka Vo-Tech)
Anoka Ice Arena
Anoka Senior Citizens Drop In
Anoka Senior Citizens Highrise
Anoka Public Works Department
Anoka Liquor Store
Anoka Liquor Store
Anoka Liquor Store
Champlin Municipal Center
Champlin Elementary School
Champlin Public Library
Champlin Municipal Liquor Store
Jackson Junior High School
Crooked Lake Community/
Elementary School
Meadowcreek Christian School
Andover City Hall
Andover Fire Hall
Ramsey City Hall
Ramsey Elementary School
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3939 7th Avenue
3300 4th Avenue
West Highway 10
1523 Hash
1902 2nd Avenue
215 West Main
540 South Street
1025 Sunnylane
6 Avenue and School
506 Jackson
2015 1st Avenue North
325 East Main
2301 3rd Avenue
2135 3rd Avenue
2929 7th Avenue
41st Avenue North &
7th Avenue North
Wash & 6th Avenue
2 Bridge Square
2301 3rd Avenue
848 East River Road
709 38th Avenue
809 West Hain
12001 Highway 52
III Dean Avenue West
230 Curtis Road
123 Miller Road
109th Street
2939 Bunker Lake Road
2941 Bunker Lake Road
1685 N.W. Crosstown Blvd.
1785 N.W. Crosstown Blvd.
15153 Nowthen Blvd.
15000 Nowthen Blvd.
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SECTION 8.
INTERCONNECTION
The System serving the Cities of Andover, Anoka, Champlin,
and Ramsey shall be completely interconnected. Grantee will com-
ply with all present and future rules, regulations and orders of
the Board regarding interconnection of systems, and will
cooperate with any agencies or utili ties involved with
interconnection. At such times as interconnection is required,
Grantee shall accomplish this without additional charge to
subscribers. System shall be initially constructed so that other
systems now or hereafter constructed in any area adjacent to
System or within the metropolitan area (if technologically
feasible) may be interconnected with System upon request of City
and agreement with other System's Grantor and Cable Company.
SECTION 9. NARROWCASTING
System shall be capable of "narrowcasting" of programs to
each community separately so that the residents of one community
may view a given program while, at the same time, residents of
another community may watch different programming at the same
time on the same channel.
SECTION 10.
REGIONAL CHANNEL
The standard VHF Channel 6 is hereby designated for uniform
regional channel usage. However, until the regional channel be-
comes operational, Grantee may utilize the standard VHF Channel 6
as it deems appropriate. Use of time on the regional channel
shall be made available without charge.
21
ARTICLE IV.
SERVICES AND PROGRAMMING,
SUBSCRIBER CONTRACTS, COMPLAINTS
SECTION 1.
SERVICES AND PROGRAMMING
A. Grantee shall provide those services and programming as
specified in its Offering.
B. City recognizes that services and programming in cable com-
munications is rapidly changing.
)
Therefore, to insure the
providing of services and programming in the best interest
of the citizens of City, Grantee may add or delete services
and programming from the System only with the express writ-
ten permission of City as authorized by the Council of City.
While such addition or deletion of programming or services
will not require the amendment of this Franchise, any addi-
tion or deletion of programming will be subject to all terms
and conditions of this Franchise.
C. Ci ty authorization of Grantee deletion of programming or
services shall not be unreasonably withheld or delayed. The
withholding of authorization of Grantee's addition of pro-
gramming or services shall not be unreasonably withheld or
delayed and shall be viewed as an administrative decision of
City requiring findings of fact demonstrating reasonable
cause for withholding authorization.
SECTION 2.
INTERRUPTION OF SERVICE AND COHPLAINTS
A. Whenever it is necessary to shut off or interrupt service,
Grantee shall do so during periods of minimum use of the
System. Unless such interruption is unforeseen and immedia-
tely necessary, Grantee shall give reasonable notice thereof
22
to subscribers. All costs incurred in repairing System and
handling complaints shall be paid by Grantee, and if service
is interrupted or di scontinued for more than 4.8 hours, sub-
scribers shall be credited pro rata for such interruption.
The cause of any such interruption shall be removed and ser-
vice restored as promptly as reasonably possible.
B. Grantee shall maintain an office in the Quad City area which
shall be open during all usual business hours, have a listed
local telephone, and be so operated that complaints and re-
quests for repairs or adjustments may be received at any
time, 7 days per week.
(1) Notice of this information shall be provided to all new
subscribers at time of subscription and to existing
subscribers annually.
(2) Grantee shall not engage in the sale of television sets
or provide other television repair service, but in the
event such service is required, shall promptly notify
subscriber of that need for service.
(3) All complaints by City, subscribers, or other persons
regarding the quality of service, equipment malfunc-
tion, billing disputes, and any other matters relative
to the System, shall be investigated and responded to
by a service representative at the location of the com-
plaint by Grantee within 24 hours. If reasonably pos-
sible, Grantee shall rectify the cause of all valid
complaints. If a complaint is not rectified within
seven days, the complainant may then file the complaint
23
.'
with City.
(4) City and Grantee shall prepare and maintain a record of
all complaints made to them. If at any time after the
filing of a complaint with City, City determines, in
its sole discretion, that the complaint represents a
violation of this Franchise, any law, ordinance or re-
gulation, or represents a failure in the performance of
Grantee pursuant to this Franchise, City may, in addi-
tion to any other remedy available to it, issue written
notice specifying the nature of the complaint and or-
dering Grantee to appear at the next regularly sched-
uled Council meeting or at a special meeting of the
Council called for this purpose. At said Council meet-
ing, Grantee shall explain its failure to rectify the
complaint and show cause why the Council should not
insti tute default proceedings. Failure by Grantee to
appear may result, at the sole discretion of City, in
the termination of this Franchise.
24
:
ARTICLE V.
CONSTRUCTION, INITIAL SERVICE AREA
LINE EXTENSION AND CONSTRUCTION STANDARDS
SECTION 1.
INITIAL SERVICE AREA
Grantee shall construct as the initial service area all
areas containing dwelling units wi thin the cities of Anoka and
Champlin, as well as all areas within Andover and Ramsey where
current dwelling unit density exceeds 40 homes per mile. All
trunk cables in all four communities shall be considered part of
the initial service area.
Grantee shall extend service to any
area contiguous to the initial service area which exceeds a dens-
ity of 40 homes per street mile or greater.
SECTION 2.
LINE EXTENSION POLICY
Grantee's extension of service to those areas not included
in the initial service area shall be done pursuant to the follow-
ing requirements:
A. In the portions of the line extension area which do not
reach 40 homes per mile, Grantee shall provide cable televi-
sion on a cost-sharing arrangement.
If any potential sub-
scriber requests that the line be extended, Grantee shall
calculate the cost on a time and material basis.
Grantee
shall assume $400 per home passed by the line extension.
Any subscriber will assume the remainder of all costs in-
cur red on a pro-rata basis.
If additional subscribers
receive service from the line extension, they will assume
their pro-rated share of the line extension cost~ and,
appropriate rebates will be made to subscribers having pre-
viously assumed those costs or if said subscriber cannot be
25
.'
located by Grantee, appropriate rebates will be made to the
current subscriber of affected dwelling unit. If additional
dwelling units are constructed in the line extension and the
line extension density remains under 40 dwelling units per
street mile contiguous to the initial service area, Grantee
shall rebate to subscribers on the line extension on a pro-
rated basis $400 for each additional dwelling unit built.
In no event will a subscriber who partially assumed con-
struction costs be rebated more than the amount initially
assumed by that subscriber.
B. If the line extension has been built and reaches a density
of 30 homes per street mile contiguous to the initial serv-
ice area, Grantee shall rebate all monies paid by those
subscribers who have assumed line extension costs. In no
event will a subscriber who partially assumed construction
costs be rebated more than the amount initially assumed by
that subscriber.
C. For installation of service drops longer than 200 feet, the
resident shall be charged an additional amount for the
installation equal to the incremental increase of the cost
of time and materials for everything longer than 200 feet.
SECTION 3. CONSTRUCTION TIMETABLE
A. \Vi thin 90 days after the granting of Franchise, Grantee
shall apply for all necessary permits, licenses, certifi-
cates and authorizations which are required in the conduct
of its business, including, but not limited to, any joint
use attachment agreements, microwave carrier licenses, or
26
"
any other permits, licenses and authorizations to be granted
by duly constituted regulatory agencies having jurisdiction
over the operation of cable communication systems, or their
associated microwave transmission facilities. If after one
year from the commencement of Franchise term, Grantee has
not received the permits, licenses, certificates and author-
izations described in this paragraph, City may terminate
this Franchise without regard to fault for delay in obtain-
ing such permits, licenses, certificates and authorizations.
B. Within 90 days after obtaining all necessary permits, li-
censes, certificates and authorizations, Grantee shall give
written notice thereof to City and commence construction and
installation of System. Grantee shall construct substan-
tially all areas of the initial service area which contain
dwelling units within one year of the granting of the state
certificate of confirmation so that persons along the route
of the energized cable will have individual "drops" as de-
sired during the same period of time.
C. Any delays in the construction timetable or commencement of
construction shall result in penalties as provided in this
Franchise, and continued delays may result in the termina-
tion of this Franchise and all rights and privileges of
Grantee hereunder.
(1) Grantee shall promptly notify City of all delays known
or anticipated in the construction of System.
(2) City may extend the time for beginning construction or
may extend the construction timetable in the event
27
Grantee, acting in good faith, experiences delays by
reason of circumstances beyond its control.
SECTION 4. CONSTRUCTION STANDARDS
A. Grantee shall not open or disturb the surface of any streets
or public property without first obtaining a permit from
City for which permit City may impose a reasonable fee to be
paid by Grantee. The lines, conduits, cable s and other
property placed in the streets and public property pursuant
to such permit shall be located in such part of the street
or public property as shall be determined by City. Grantee
shall, upon completion of any work requiring the opening of
any streets or public property, restore the same, including
the pavement and its grounds to as good a condition as form-
erly and in a manner and quality approved by City, and shall
exercise reasonable care to maintain the same thereafter in
good condition. Such work shall be performed with diligence
and due care, and if Grantee shall fail to perform the work
promptly, to remove all dirt and rubbish and to put the
street or public property back into the condition required
hereby, City shall have the right to put the streets or pub-
lic property back into good condi ti,on at the expense of
Grantee. Grantee shall, upon demand, pay to City the reas-
onable cost of such work done or performed.
B. All wires, conduits, cable and other property and facilities
of Grantee shall be so located, constructed, installed and
maintained as not to endanger or unnecessarily interfere
with the usual and customary trade, traffic and travel upon,
28
"
or other use of, the streets and public property of City.
Grantee shall keep and maintain all of its property in good
condition, order and repair so that the same shall not men-
ace or endanger the life or property of any person. City
shall have the right to inspect and examine at all reason-
able times and upon reasonable notice the property owned or
used, in part or in whole, by Grantee. Grantee shall keep
accurate maps and records of all of its wires, conduits,
cables and other property and facilities located, construct-
ed and maintained in the City. Further, Grantee shall,
without charge, furnish copies of such maps and records from
time to time as requested by City.
C. All wires, conduits, cables and other property and facili-
ties of Grantee, shall be constructed and installed in an
orderly and workmanlike manner. All wires, conduits and
cables 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.
D. Grantee shall at all times comply with all applicable laws,
ordinances, rules, regulations and codes, federal, state and
local. In any event, the installation, operation or main-
tenance of System shall not endanger or interfere with the
safety of persons or property in the City.
E. Whenever City shall undertake any public improvement which
affects Grantee's equipment or facilities, City shall, with
due regard to reasonable working conditions and with reason-
29
able notice, direct Grantee to remove its wires, conduits,
cables and other property located in streets or public
property. Grantee shall relocate or protect its wires, con-
duits, cables and other property at its own expense.
F. Grantee's plans for constructing its System, and the con-
struction of the System, shall be in accordance with its
Offering. However, Grantee shall comply with the following
minimum requirements:
(1) Grantee shall construct underground in any area where
all other utility lines are underground.
(2) Grantee shall change from aerial to underground, at its
own expense, in any area where (i) all other lines are
are hereafter changed from aerial to underground or
(ii) any aerial line is changed to underground by the
open trench method and City requests Grantee to share
the trench.
(3) To enable Grantee reasonable opportunity to change its
wiring from aerial to underground, and also to allow it
to prewire all new multiple dwelling units, subdivi-
sions or new development areas, City shall provide
Grantee with written notice of the following, but in no
event shall City have any liability for failure to pro-
vide notice of the following:
(a) Any changes of which City has knowledge, or which
City may order, regarding a change from aerial to
underground of any line (telephone or electrical)
within its boundaries.
30
"
(b) Any underground trenching that may be pending.
(c) All subdividers or developers of new subdivisions
and developments shall be notified .of the Fran-
chise and the System.
(d) All Franchise changes affecting the wiring of the
System.
SECTION 5. CONDITIONS ON USE
A. Grantee shall not place poles or other fixtures where the
same will interfere with any gas, electric or telephone fix-
ture, water hydrant or main, and sewer line.
B. Grantee, at the request of any person holding a building
moving permit and with not less than five days advance
notice, shall temporarily remove, raise or lower its wires,
conduits and cables. The expense of such temporary removal,
raising or lowering of wires, conduits and cables shall be
paid by person requesting the same, and Grantee shall have
the authority to require such payment in advance.
C. Grantee shall have the authority, to the extent the City has
authority to grant the same, to trim trees upon or overhang-
ing any street or public property so as to prevent the
branches of such trees from coming in contact with the
wires, conduits and cables of Grantee. All trimming for the
benefit of Grantee shall be done under the supervision and
direction of City and at the expense of Grantee.
D. Nothing contained in this Franchise shall relieve any person
from liability arising out of the failure to exercise reas-
onable care to avoid injuring the Grantee's facilities while
31
performing any work connected with grading, regrading or
changing the line of any street or public place or with the
construction or reconstruction of any sewer or water system.
32
ARTICLE VI.
SYSTEM OPERATIONS
SECTION 1. INFORMATION AVAILABILITY
A. Throughout the term of this Franchise, Grantee shall main-
tain books and records in accordance with normal and ac-
cepted bookkeeping and accounting practices for the cable
communications industry, and allow for inspection and copy-
ing of them by City at reasonable times at its designated
office. The books and records to be maintained by Grantee
shall include the following:
(1) A record of all requests for service except those re-
quests subsequently withdrawn (retained for two years);
(2) A record of all subscriber or other complaints, and the
action taken (retained for two years);
(3) A file of all subscriber contracts;
(4) Grantee policies, procedures and company rules; and
(5) Financial records.
B. City shall give Grantee at least 24 hours notice before mak-
ing inspections of any books or records of Grantee.
C. Grantee shall file with City, at the time of its annual pay-
ment of the franchise fee, as described in this Franchise,
the following (although City may make written waiver of
receipt of any of the following):
(1) A financial statement certified by an officer of Grant-
ee showing,. in such reasonable detail as acceptable to
City, the gross revenues of Grantee for the preceding
fiscal year.
33
"
(2) Current list of names and addresses of each officer and
director and other management personnel, and if a cor-
poration, each shareholder having stock. ownership of
three (3%) percent or more, and if a partnership, all
general partners, and if a general partner is a corpor-
ation, the foregoing information shall be given as to
the corporate general partner.
(3) A copy of each document filed with all federal, state
and local agencies not previously filed with City with
respect to the ownership and operation of System (each
of these filings shall be provided at the time the fil-
ing is made) .
(4) A statement of its current billing practices.
(5) A current copy of its rules and policies.
(6) A current copy of its subscriber service contract, if
any.
D. City, its agents and representatives shall have authority to
arrange for and conduct an audit of and copy the books and
records of Grantee. The City and Grantee shall establish
reasonable procedures to protect the confidentiality of
information. Grantee shall first be given five days notice
of the audit request, the description of and purpose for the
audit, and description, to the best of City's ability, of
the books, records and documents it wants to review.
SECTION 2. SERVICE CONTRACT
A. Grantee shall receive approval from City of the form and
content of the service contract to be used by Grantee prior
34
"
to entering into any such service contracts with subscrib-
ers, and the Grantee shall make no changes in the approved
service contract without prior written approval of City,
which permission shall not be unreasonably withheld or
delayed. The service contract shall include, at a minimum,
a schedule of all applicable rates and charges, description
of services, instructions on the use of the system, billing
and collection practices.
B. The service contract shall further contain a statement as
follows:
Grantee shall not, as to rates, charges, service facil-
ities, rules, regulations or in any other respect, make
or grant any preference or advantage to any person, nor
subject any person to any prejudice or disadvantage,
provided, however, that nothing in this Franchise shall
be deemed to prohibit the establishment of special
contracts or reduced rates for senior citizens or hand-
icapped heads of households or for installation rate
reductions for 90 days after cable service is first
offered in an area or for such other purposes offered
to all individuals similarly situated or to meet com-
petition from other providers of telecommunications
services.
C. Grantee shall have authority to promulgate such rules, re-
gulations, terms and conditions governing the conduct of its
business as shall be reasonably necessary to enable Grantee
to exercise its rights and perform its obligations under
35
"
this Franchise and to assure an uninterrupted service to
each and all of its subscribers ~ provided, however, that
such rules, regulations, terms and conditions shall not be
in conflict with the provisions of the Franchise, ordinances
of City, and laws of the State of Minnesota or the United
States.
D. Each subscriber shall be provided with instructions on fil-
ing complaints or otherwise obtaining information or assist-
ance from Grantee.
E. All items described in this section shall be provided to
each new subscriber at the time a contract is entered into
or service begun, and to all existing subscribers not less
than once each year.
F. The term of a subscriber contract shall not be for more than
12 months duration unless after 12 months the contract may
be terminated by the subscriber at his option at any time,
with no penalty to subscriber.
SECTION 3. SUBSCRIBER PRACTICES
A. There shall be no charge for disconnection of any installa-
tion or outlet. If any subscriber fails to pay a properly
due monthly subscriber fee, or any other properly due fee or
charge, Grantee may disconnect the subscriber's service out-
let, provided, however, that such disconnection shall not be
effected until after the later of (i) 45 days after the due
date of said delinquent fee or charge or (ii) ten days after
delivery to subscriber of written notice of the intent to
disconnect. If a subscriber pays before expiration of the
36
"
later of (i) or (ii), Grantee shall not disconnect. After
disconnection, upon payment in full of the delinquent fee or
charge and the payment of a reconnection charge, Grantee
shall promptly reinstate the subscriber's cable service.
B. Refunds to subscribers shall be made or determined in the
following manner:
(1) If Grantee fails, upon request by a subscriber, to pro-
vide any service then being offered, Grantee shall
wi thin 60 days of subscriber request refund all de-
posits or advance charges paid for the service in ques-
tion by said subscriber. This provision does not alter
Grantee's responsibility to subscribers under any sepa-
rate contractual agreement or relieve Grantee of any
other liability.
(2) If any subscriber terminates any monthly service be-
cause of failure of Grantee to render the service in
accordance with Franchise, Grantee shall refund to such
subscriber the proportionate share of the charges paid
by the subscriber for the services not received. This
provision does not relieve Grantee of liability estab-
lished in other provisions of this Franchise.
C. If any subscriber terminates any monthly service prior to
the end of a prepaid period, a proportionate amount of any
prepaid subscriber service fee, using the number of days as
a basis, shall be refunded to the subscriber by Grantee.
D. Continued failure by Grantee to provide services required by
this Franchise may, in the discretion of City, be cause for
37
-'
imposition of a penalty or termination of this Franchise.
SECTION 4.
FRANCHISE FEE, RATES, CHARGES, CHANGES IN FEES AND
PROCEDURES
A. Rate Change Procedure.
(1) To the extent permitted by law, all increases in sub-
scriber rates and charges shall be charged by Grantee,
in a manner provided for herein. Grantee, as a condi-
tion precedent to its acceptance of this Franchise
hereby knowingly and voluntarily consents to these
procedures for the term of this Franchise of all rates
and charges.
(2) City hereby reserves the right to approve or adopt reg-
ulations governing Grantee's collection of advance
charges and deposits, installation and reconnect ion
charges, policies and procedures, disconnection charg-
es, policies and procedures, and the availability of
refunds. Approval of City shall not be unreasonably
withheld or delayed.
(3) Cost for installing any part of the System will be a
factor in the rate only if such cost was incurred with-
in City.
(4) The territory for rates applicable to System shall be
City and all Cities then parties to a joint powers
agreement relating to the System.
B. Franchise Fee.
(1) Throughout the term of this Franchise, Grantee shall
pay to City, within 60 days after the end of each fis-
38
cal year of Grantee, an annual fee of five percent (5%)
of all gross revenues.' No payment will be allowed of
any fee that is different from five percent, other than
the filing fee and payment required of the successful
applicant as established by City to recover the costs
of franchising. Grantee agrees to support any waiver
required by the FCC for the established franchise fee.
The annual fee may be subject to renegotiation at such
time as federal or state authorities no longer regulate
the amount of the fee. If Grantee and City do not
agree in renegotiations, the Franchise fee shall remain
unchanged.
(2) Payment will be made to City with an itemization of the
gross revenues derived from the services in City.
C. Rates and Other Charges.
(1) Rates and charges charged by Grantee for monthly ser-
vice and installation and other charges hereunder shall
be uniform, fair and reasonable and designed to meet
all necessary costs of service, including a fair rate
of return on the original cost, less depreciation, of
the properties devoted to such service (without regard
to any subsequent sale or transfer price or cost of
such properties) .
(2) For three years after commencement of cable service to
residential subscribers, the maximum rates shall be the
specific rates of Grantee as included in Exhibit A,
attached hereto and made a part of this Franchise and
39
known as Grantee Schedule of Rates.
(3) Service requests for maintenance or repair of Grantee's
property shall be performed at no charge to a subscrib-
er. I f such maintenance or repair is required as a
result of damage caused by subscriber, Grantee may
charge to the subscriber as a maximum its direct costs
for material and labor for service calls to subscrib-
er's home.
(4) Rates for new or additional services not initially in-
cluded in Offering of Grantee and therefore not listed
in Exhibit A shall be established by resolution of
Council of City according to the terms of this Fran-
chise.
D. Rate Changes.
(1) No rate change shall be approved that would result in
different rates or charges for service to similarly
situated subscribers in the rate territory, other thE'J1
those specified in Article VI, Section 2.P.
(2) The standards for reviewing a proposed rate change will
include at least the following:
(a) The ability of the Grantee to render System serv-
ices and to derive a reasonable profit therefrom
under the existing rate schedule and proposed rate
schedule;
(b) All revenues and profits or actual losses derived
from System;
(c) Tax benefits and tax costs received by Grantee,
40
its partners or shareholders, as the result of
their investment in the System~
(d) Cash flow generated by System~
(e) The efficiency of Grantee;
(f) The quality of the service offered by Grantee~
(g) The original cost of the System, less deprecia-
tion~
(h) A fair rate of return with respect to investments
having similar risks to that of providing cable
communication services~
(i) The extent to which Grantee has adhered to the
terms of this Franchise;
(j) Fairness to residents and subscribers~
(k) Capital expenditures (actual and, if the situation
so warrants, projected) by Grantee in providing
updated technology and service to subscribers~
(1) The extent to which Grantee has then provided
service to schools, hospitals, libraries, publicly
owned or leased buildings and similar institutions
within City~
(m) The extent to which Grantee has technologically
upgraded the System~ and
(n) Increased or decreased expenses incurred by Grant-
ee in the purchase of services~ and
(0) Such other factors as City or Grantee may deem
relevant.
(3) The procedures to be followed in changing a Basic rate
41
or charge shall include at least the following:
(a) Grantee shall give City written notice of any
proposed
rate increase at least ninety (90) days
prior to the proposed effective date of the rate
increase.
(b) The application shall be supported by statistical
and other proof indicating that the existing rate
or charge is inadequate and unreasonable and that
the proposed increases are required to enable
Grantee to render service to fulfill its obliga-
tions under this Franchise and to derive a reason-
able profit therefrom.
(c) The notice shall include current financial and
other information with at least the following:
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 re-
quired by City;
5. Statement of current and projected subs crib-
ers;
6.
A current list of
Grantee applicable to
erated by its parent
rates and charges of
systems owned or op-
corporation or other
42
subsidiaries or affiliates of its parent
corporation at other locations~
7. A current list of rates and charges for other
systems in the seven county Metropolitan
area~
8. Cash flow derived from System services since
the commencement of this Franchise~ and
9. Statement of tax benefits received by
Grantee, its partners or shareholders, as a
result of their investment in System.
(d) In the event the proposed rate increase exceeds
(in any respect) the projected rate increases
shown on Exhibit B, City shall notify Grantee and
Board and shall schedule a public hearing on the
proposed rate increase within two weeks from the
date of receipt of the notice. Grantee will noti-
fy the public through providing notice for one
week, each day between 7:00 p.m. and 9:00 p.m. on
two lowest tier channels of the date, place and
time of the hearing. City will publish notice ten
days prior to hearing in its official newspaper.
(e) After closing the public hearing, City will have
31 days within which to make its determination~
however, any proposed change in rates or charges
shall become effective upon the date specified in
the notice of Grantee. Approval of City shall not
be unreasonably withheld.
43
(f) If City fails to approve the change of rates or
charges within the 31 day period, the rate shall
still become effective upon the date specified in
the notice of Grantee.
(g) City may utilize a rate consultant to advise it on
proposed rate changes and to assist it in main-
taining uniform rates wi thin the rate territory.
A rate consultant may be any person who has suf-
ficient background and experience, in the sole
opinion of City, to properly evaluate and analyze
rates and charges.
(h) All costs for the review of a notice for a rate or
charge change shall be paid by City from the Fran-
chise fee.
(i) Any time limit may be waived only if City and
Grantee consent.
(j) If City fails to approve the change of rates,
either City or Grantee may initiate binding arbi-
tration pursuant to Minnesota Statutes except as
delineated below.
(k) The parties shall, within 15 days of City's fail-
ure to approve the rate increase, appoint one
arbitrator each who is experienced and knowledge-
able in the evaluation and analysis of cable rate
and charge changes. Arbitrators shall each agree
upon the selection of a third arbitrator, simi-
larly qualified, within 15 days after appointment
44
of the second arbitrator.
(1) Within 15 days after appointment of all arbitrat-
ors and upon ten days written notice to parties,
the arbitrators shall commence a hearing on the
rate change proposed by Grantee.
(m) The hearing shall be recorded and may be tran-
scribed at the request and expense of either
party. All hearing proceedings, debates and de-
liberations shall be open to the public, City, and
Grantee and at such times and places as contained
in the notice or as thereafter publicly stated in
the order to adjourn.
(n) The arbitration panel shall be required to ap-
prove, rej ect or modify the rate change proposed
by Grantee according to the standards established
in this Franchise.
(0) At the close of the hearings and within 30 days,
the arbitrators shall prepare written findings and
make a written decision agreed upon by a majority
of the arbitrators which shall be served by mail
upon City and Grantee.
(p) The decision of a majority of the arbitrators
shall be binding upon both parties, provided that
either party may pursue any jUdicial remedies
otherwise available to either party.
(q) Should the rate change be rejected or modified by
a majority of the arbitrators, the Grantee shall
45
within ninety (90) days and pursuant to procedures
established by Grantee refund the rate overage to
affected subscribers.
(r) Either party may also seek judicial relief to the
extent authorized under Hinnesota Statutes,
~572. 09 and ~572 .19 as the same may be amended,
and in addition, under the following circumstan-
ces:
(i)
(ii)
(iii)
(iv)
(v)
A party fails to select an arbitrator;
The arbitrators fail to select a third arbi-
trator;
One or more arbitrator is unqualified;
Designated time limits have been exceeded;
The arbitrators have not proceeded expedi-
tiously; or
(vi) Based upon the record the arbitrators abused
their discretion.
(s) In the event a Court of competent jurisdiction
determines the arbitrators have abused their
discretion, or that the regulation of a given rate
is beyond the authority of City, it may order the
arbitration procedure repeated and issue findings,
orders and directions, with costs of suit to be
awarded to the prevailing party.
(t) Cost of arbitration shall be borne equally.
(4) The procedures to be followed in changing any rate or
charge other than basic shall include the following:
46
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(a) Grantee shall give City written notice of any rate
increase at least ninety (90) days prior to the
effective date of the rate increase.
(b) In the event the percentage of the rate increase
(in any respect) does not exceed the percentage of
the increase from the CPI in existence on the date
of the certification of this Franchise by the
Board or specified in the last rate increase
notice of the Grantee (whichever event is most
recent), the noticed rate shall become effective
upon its noticed effective date.
(c) Except as provided in Article VI, Section 4.,
D. (c) (5), in the event the percentage of the rate
increase (in any respect) exceeds the percentage
of increase from the CPI in existence on the date
of the certification of this Franchise by the
Board or specified in the last rate increase
notice of the Grantee (whichever event is most
recent), the notice rate shall become effective
upon its noticed effective date but the notice
shall also include current financials and other
information as specified in Article VI, Sec-
tion 4., D. (4) (c) (1. -9. ) .
(i) Upon review by City of the information pro-
vided in the notice by Grantee, City may
schedule a public hearing on the proposed
rate increase within two (2) weeks from the
47
date of receipt of the notice. Grantee will
notify the public as specified in Article VI,
Section 2., 0.(4) (d). The City will publish
notice ten (10) days prior to the hearing in
its official newspaper.
(ii) After closing the public hearing, City will
have thirty-one (31) days wi thin which to
make any determination regarding the noticed
rate increase; however, any proposed change
in rates or charges shall become effective
upon the date specified in the notice of
Grantee regardless of the determination of
City.
(iii) The City may utilize a rate consultant to
advise it on proposed rate changes and to
assist it in maintaining uniform rates within
the territory. A rate consultant may be any
person who has sufficient background and
experience, in the sole opinion of City, to
properly evaluate and analyze rates and
charges.
(iv) All costs for the review of a notice for rate
or charge change should be paid by City from
the Franchise fee.
(5) In the event the law should provide for the regulation
of other than basic rates by City, the procedure for
the change of other than basic rates shall be as
48
outlined above, except that subsequent to the public
hearing, should the City fail to approve the change of
rates, either City or Grantee may initiate binding
arbi tration pursuant to t-1innesota statutes except as
delineated in Article VI, Section 3., D. (k)-(t).
E. periodic Reviews, Renegotiation and Technological Update of
System.
The field of cable communications is a relatively new
and rapidly changing one which shall no doubt see many re-
gulatory, technical, financial, marketing and legal changes
during the term of the Franchise. Therefore, in order to
provide for a maximum degree of flexibility in this Fran-
chise, and to help achieve a continued advanced and modern
system, the following renegotiation provisions will apply:
(1) City reserves the right to adopt rules and regulations
controlling the procedures and subjects for periodic
reviews and renegotiation. In the absence of any City
action taken to exercise these rights, Grantee shall be
subject to at least the procedures and subjects de-
scribed in this section.
(2) City may require, in its sole discretion, System per-
formance evaluation sessions at any time during the
term of this Franchise. or as required by federal or
state law. In addition to these discretionary evalua-
tion sessions, regular evaluation sessions shall be
conducted by City within 30 days of the third, fifth
and eighth anniversary dates of the date of acceptance
49
of this Franchise by Grantee.
(3) All evaluation sessions shall be open to the public and
notice of sessions published in the same way as a legal
notice. Grantee shall notify its subscribers of all
evaluation sessions by announcement on at least two
channels of the System between the hours of 7:00 p.m.
and 9:00 p.m. for five consecutive days preceding each
session.
(4) Topics which may be discussed at any evaluation session
may include, but not be limited to, service rate struc-
tures; franchise fee; penalties; free or discounted
services; application of new technologies; system per-
formance; services provided; programming offered; com-
munity access; local origination; customer complaints;
privacy; amendmemts to this Franchise; judicial, Board
and FCC rulings; line extension policies; and Grantee
or City Rules.
(5) During a review and evaluation by City, Grantee shall
fully cooperate with City and shall provide without
cost such information and documents as City may request
to reasonably perform the service.
(6) If at any time during its review, City determines that
reasonable evidence exists of inadequate System per-
formance, it may require Grantee to perform tests and
analyses directed toward such suspected inadequacies at
the Grantee's own expense. Grantee shall fully cooper-
ate with City in performing such testing and shall pre-
50
pare results and a report, if requested, within 30 days
after notice. The report prepared by Grantee shall
include at least:
(a) A description of the problem in System performance
which precipitated the special tests.
(b) What System component was tested.
(c) The equipment used and procedures employed in
testing.
(d) The method, if any, by which such System perform-
ance problem was resolved.
(e) Any other information pertinent to said tests and
analyses which may be required by City, or deter-
mined when the test is performed.
City may require that tests be supervised at Grantee's
expense by a consultant designated by City. The con-
sultant shall sign all records of special tests and
forward to City such records with a report interpreting
the results of the tests and recommending actions to be
taken.
(7) Grantee shall exercise its best efforts to maintain a
modern state-of-the-art System which is comparable to
other operating CATV systems similarly situated. As a
resul t of the periodic review ses sions, City may re-
quest Grantee to modify or to upgrade the System, or to
provide additional services, and authorize rate in-
creases sufficient to insure the economic feasibility
of these changes. Grantee shall implement such changes
51
unless: (a) technology does not permit the suggested
changes: (b) the proposed changes and rate increases
taken in combination are not economically feasible: or
(c) insufficient time has been allowed for implementa-
tion. In the event of a disagreement between City and
Grantee with respect to the items above, City may
retain a cable consultant to advise and assist both
parties in continued negotiations with respect to the
changes which City desires. Either party may initiate
binding arbitration pursuant to Minnesota Statutes and
Article XI, section 2B of this Franchise. Costs of
arbitration shall be shared equally by Grantee and
City.
SECTION 5. FRANCHISE RENEWAL
A. Grantee may apply for renewal of this Franchise at any time
prior to the expiration of this Franchise on forms provided
by City. In any event renegotiation shall commence at least
12 months before the expiration of the Franchise term, un-
less the City determines not to reissue the Franchise to
Grantee or desires to consider additional applicants for a
franchise.
B. Grantee may be approved, and this Franchise or modification
to it may be renewed, by City in accordance wi th the then
existing rules of the FCC, the Board, the City and all other
applicable laws, ordinances, rules or regulations.
C. Nothing in this Franchise shall be construed to require
renewal of this Franchise.
52
D. City shall conduct an investigation and evaluation of the
Grantee and the System and the renewal proposal. This in-
vestigation and evaluation shall be completed by City within
six months after receipt of the application and determina-
tion by City of its completeness.
E. Renewal of this Franchise may be for any length of time but
not more than fifteen years, unless otherwise permitted by
federal or state law, and may be on a year to year basis in
the sole discretion of City.
53
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ARTICLE VIII.
INDEMNIFICATION, INSURANCE, LETTER OF
CREDIT AND BOND
SECTION 1.
GENERAL
A. All rights of City pursuant to indemnification, insurance
letter of credit or bond, as provided for by this Franchise,
are in addition to all other rights the City may have under
this Franchise or any other ordinance, rule, regulation or
law.
B. The exercise or failure to exercise by City of any rights
pursuant to any section of this Franchise shall not affect
in any way the right of City to subsequently exercise any
such rights or any other right of City under this Franchise
or any other ordinance, rule, regulation or law.
SECTION 2.
INDEMNIFICATION AND INSURANCE
A. Grantee shall fully indemnify, defend and hold harmless,
City, its officers, boards, commissions, elected officials,
agents and employees against any and all costs, damage, ex-
pense, claims, suits, actions, liability and judgments for
damages, including but not limited to, expenses for legal
fees, whether suit be brought or not, and disbursements and
liabili ties incurred by City related to this Franchise or
the System in connection with:
(1) Damage to persons or property, in any way arising out
of or through the acts or omissions of Grantee, their
respective servants, officials, agents, or employees or
to which Grantee's negligence or that of their respec-
tive servants, agents, officials or employees shall in
55
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any way contribute;
(2) Arising out of any claim for invasion of the right of
privacy, for defamation of any person, firm or corpora-
tion, or the violation or infringement of any copy-
right, trademark, trade name, service mark or patent,
or of any other right of any person, firm or corpora-
tion, except claims because of City's own programming;
and
(3) Arising out of Grantee's failure to comply with the
provisions of this Franchise, any federal, state or
local law, ordinance or regulation applicable to Grant-
ee or the System.
(4) Any and all claims which Grantee may now or hereafter
have or claim to have against City, its servants,
agents, employees or officials, due to or arising out
of damage to any of Grantee 1 s property or equipment,
including, without limitation, resulting or consequent-
ial loss of income, injury to reputation, or any other
resulting or consequential damages of any kind, caused
by or resulting from acts or omissions of City or any
of its servants, agents employees or officials.
B. If suit be brought or threatened against City, either inde-
pendently or jointly with Grantee, or with any person or
municipality, Grantee, upon notice given by City, shall de-
fend City at the cost of Grantee, and if final judgment is
obtained against City, either independently or jointly with
Grantee, or any other defendants, Grantee shall indemnify
56
City and pay such judgment with all costs and satisfy and
discharge the same.
C. City reserves the right to cooperate with Grantee and parti-
cipate in the defense of any litigation either through in-
tervention or otherwise. Grantee shall pay upon receipt of
written demand from City, all expenses incurred by City in
defending itself with regard to any matters in this section.
These expenses shall include, but not be limited to, attor-
neys' fees, and the reasonable value of services (as deter-
mined by City) rendered by City or any employees, agents or
representatives of City.
SECTION 3. INSURANCE
A. Grantee shall maintain liability insurance covering its ob-
ligations of indemnification provided for in or as a result
of the exercise of this Franchise covering both the City and
Grantee and shall maintain said insurance during the entire
term of this Franchise in the minimum amount of:
(1) $500,000 for property damage to anyone person1
(2) $2,000,000 for property damage in anyone act or oc-
currence1
(3) $1,000,000 for personal injury to any one person~ and
(4) $2,000,000 for personal injury in anyone act or oc-
currence.
B. Such insurance shall be with a company acceptable to City
and shall otherwise be in form and substance acceptable to
City. Such insurance policy with written evidence of pay-
ment of required premiums shall be filed and maintained with
57
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City during the term of the Franchise. The above minimum
amounts shall be changed from time to time by Grantee as
requested by City. Grantee shall immediately give notice to
City of any threatened or pending litigation affecting this
insurance.
C. Neither the provisions of this section nor any damages re-
covered by City or any individual shall be construed to, or
shall limit the liability of Grantee.
D. No recovery by City of any sum by reason of the Letter of
Credit or Bond required in this Franchise shall be any lim-
i tation upon the liability of Grantee to City under the
terms of this section, except that the sum so received by
Ci ty from such Letter of Creditor Bond shall be deducted
from a recovery by City under this section, if for the same
act or occurrence.
E. All insurance policies maintained pursuant to this Franchise
shall contain the following endorsement:
It is hereby understood and agreed that this insurance
policy may not be cancelled nor the intention not to
renew be stated until 60 days after receipt by City, by
registered mail, of written notice of such intention to
cancel or not to renew.
SECTION 4. LETTER OF CREDIT
A. At the time of acceptance of this Franchise, Grantee shall
deliver to City an irrevocable and unconditional Letter of
Credi t, in form and substance acceptable to City, from a
National or State bank approved by City, in the amount of
58
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$10,000.
B. The Letter of Credit shall provide that funds will be paid
to City, upon written demand of City, and in an amount
solely determined by City in payment for penalties charged
pursuant to this section, in payment for any monies owed by
Grantee pursuant to its obligations under this Franchise, or
in payment for any damage incurred as a result of any acts
or omissions by Grantee pursuant to this Franchise.
C. In addition to recovery of any monies owed by Grantee to
City or damages to City as a result of any acts or omissions
by Grantee pursuant to the Franchise, City in its sole dis-
cretion may charge to and collect from the Letter of Credit
the following penalties:
(1) For failure to complete System construction in accord-
ance with Grantee's initial service area plan, unless
City approved the delay, the penalty shall be Five Hun-
dred Dollars ($500.00) per day for each day, or part
thereof, such failure occurs or continues.
(2) For failure to provide data, documents, reports or in-
formation or to cooperate with City during an applica-
tion process or System review, the penalty shall be One
Hundred Dollars ($100.00) per day for each day, or part
thereof, such failure occurs or continues.
(3) For failure to comply with any of the provision of this
Franchise for which a penalty is not otherwise specifi-
cally provided pursuant to this Paragraph C, the
penalty shall be One Hundred Dollars ($100.00) per day
59
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for each day, or part thereof, such failure occurs or
continues.
(4) For failure to test, analyze and report on the perform-
ance of the System following a request by City, the
penalty shall be One Hundred Dollars ($100.00) per day
for each day, or part thereof, such failure occurs or
continues.
(5) For failure by Grantee to modify the System or to pro-
vide additional services within 45 days after required
by binding arbitration the penalty shall be Five Hun-
dred Dollars ($ 5 0 0 . 00) per day for each day, or part
thereof, such failure occurs or continues.
(6) Forty-five days following notice from City of a failure
of Grantee to comply with construction, operation or
maintenance standards, the penalty shall be Five Hun-
dred Dollars ($500.00) per day for each day, or part
thereof, such failure occurs or continues.
(7) For failure to provide the services Grantee has pro-
posed, including but not limited to the implementation
and the utilization of the access channels and the mak-
ing available for use of the equipment and other fac-
ilities to City, the penalty shall be Five Hundred Dol-
lars ($500.00) per day for each day, or part thereof,
such failure occurs or continues.
(8) Each violation of any provision of this Franchise shall
be considered a separate violation for which a separate
penalty can be imposed.
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D. Exclusive of the contractual penalties set out above in this
section, a violation of any provision of this Franchise is a
misdemeanor.
E. Whenever City finds that Grantee has violated one or more
terms, conditions or provisions of this Franchise, a written
notice shall be given to Grantee informing it of such vio-
lation. At any time after fifteen days following local re-
ceipt of notice, provided Grantee remains in violation of
one or more terms, conditions or provisions of this Fran-
chise, in the sole opinion of City, City may draw from the
Letter of Credit all penalties and other monies due City.
F. Whenever a penalty has been assessed, Grantee may, within
thirty days of local receipt of notice, notify City that
there is a dispute as to whether a violation or failure has,
in fact, occured. Such notice by Grantee to City shall spe-
cify with particularity the matters disputed by Grantee.
(1) City shall hear Grantee's dispute at the next regularly
scheduled Council meeting. City shall supplement the
Council decision with written findings of fact.
(2) Upon a determination by City that no violation has tak-
en place, City shall refund to Grantee without interest
all monies drawn from the Letter of Credit by reason of
the alleged violation.
G. If said Letter of Credit or any subsequent Letter of Credit
delivered pursuant hereto expires prior to 15 months after
the expiration of the term of this Franchise, it shall be
renewed or replaced during the term of this Franchise to
61
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provide that it will not expire earlier than 15 months after
the expiration of this Franchise. The renewed or replaced
Letter of Credit shall be on the same form and with a bank
authorized herein and for the full amount stated in para-
graph A of this section. Failure to renew or replace the
Letter of Credit shall be grounds for termination of this
Franchise.
H. If City draws upon the Letter of Credit, or any subsequent
Letter of Credit delivered pursuant hereto, in whole or in
part, Grantee shall replace the same within fifteen days and
shall deliver to City a like replacement Letter of Credit
for the full amount stated in paragraph A of this section as
a substitution of the previous Letter of Credit.
I. If any Letter of Credit is not so replaced, City may draw on
said Letter of Credit for the whole amount thereof and hold
the proceeds, without interest, and use the proceeds to pay
costs incurred by City in performing and paying for any or
all of the obligations, duties and responsiblities of
Grantee under this Franchise that are not performed or paid
for by Grantee pursuant hereto, including attorneys' fees
incurred by the City in so performing and paying. The
failure to replace any Letter of Credit may also, at the
option of City, be deemed a default by Grantee under this
Franchise. The drawing on the Letter of Credit by City, and
use of the money so obtained for payment or performance of
the obligations, duties and responsibilities of Grantee
which are in default, shall not be a waiver or release of
62
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such default.
J. The collection by City of any damages, monies or penalties
from the Letter of Credit shall not affect any other right
or remedy available to City, nor shall any act, or failure
to act, by City pursuant to the Letter of Credit, be deemed
a waiver of any right of City pursuant to this Franchise or
otherwise.
SECTION 5. BONDS
A. At the commencement of this Franchise, and at all times
thereafter until Grantee has liquidated all of its obliga-
tions with City, Grantee shall maintain with City a bond in
the total sum of One Hundred Thousand Dollars ($100,000.00)
in such form and with such sureties as shall be acceptable
to City, conditioned upon the faithful performance of Grant-
ee of this Franchise and the acceptance hereof given by
Grantee and upon the further condition that in the event
Grantee shall fail to comply with any law, ordinance or reg-
ulation, there shall be recoverable jointly and severally
from the principal and surety of the bond, any damages or
losses suffered by City as a result, including the full
amount of any compensation, indemnification or cost of re-
moval of any property of Grantee, including a reasonable
allowance for attorneys I fees and costs (with interest at
two (2%) percent in excess of the then prime rate), up to
the full amount of the bond, and which bond shall further
guarantee payment by Grantee of all claims and liens against
Ci ty or any public property, and taxes due to City, which
63
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arise by reason of the construction, operation, maintenance
or use of the System.
B. The rights reserved by City with respect to the bond are in
addition to all other rights the City may have under this
Franchise or any other law.
C. City may, in its sole discretion, reduce the amount of the
bond.
64
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ARTICLE IX.
DEFAULT
SECTION 1. NOTICE AND DEFAULT
A. City shall give written notice of default to Grantee if
City, in its sole discretion, determines that Grantee has:
(1) Violated any material provision of this Franchise or
the acceptance hereof, or any rule, order, regulation
or determination of the City, state or federal govern-
ment, not in conflict with this Franchise~
(2) Attempted to evade any provision of this Franchise or
the acceptance hereof~
(3) Practiced any fraud or deceit upon City or subscribers~
(4) Made a material misrepresentation of fact in the ap-
plication for or negotiation of the Franchise~ or
(5) Incurred a 6 month or more delay in the construction
schedule.
B. If Grantee fails to cure such default within 30 days after
the giving of such notice (or if such default is of such a
character as to require more than 30 days within which to
cure the same, and Grantee fails to commence to cure the
same within said 30 days period and thereafter fails to use
reasonable diligence, in City's sole opinion, to cure such
default as soon as possible), then and in any event, such
default shall be a substantial breach and City, at its op-
tion may elect to either cure the default or terminate and
cancel this Franchise and all rights and privileges of this
Franchise as follows:
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....
(1) City may cure any default and all sums expended by
City, including attorneys' fees incurred in curing such
default, whether suit be brought or not, with interest
thereon at a rate per annum of two (2%) percent in ex-
cess of the then prime rate, shall be paid by Grantee
to City, upon demand, and failure to so pay upon demand
likewise may be deemed by City to be a default under
this Franchise.
(2) City may place the issue of revocation and termination
of the Franchise before the Council at a regular meet-
ing of the City Council. If City decides there is
cause or reason to terminate, the following procedure
shall be followed:
(a) City shall provide Grantee with a written notice
of City's intention to terminate the Franchise and
the reason or cause for proposed termination.
City shall allow Grantee a minimum of 30 days sub-
sequent to receipt of the notice in which to cor-
rect the default.
(b) Grantee shall be provided with an opportunity to
be heard at a public hearing prior to any decision
to terminate this Franchise.
(c) In the event that City determines to terminate
this Franchise, the Grantee shall have a period of
30 days, beginning the day next following written
notice to Grantee of such decision, wi thin which
to file an appeal with the Board, pursuant to the
66
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then applicable statutes and procedures of the
Board. Any such appeal to the Board shall be a
contested case to which the Board shall not be a
party. During such 30 day period and until the
Board determines the appeal, if an appeal is tak-
en, the Franchise shall remain in full force and
effect, unless the term thereof sooner expires.
(d) If Board approves of the action of City, the Fran-
chise shall terminate immediately. If Board dis-
approves of the action of City, the Franchise
shall remain in full force and effect for the full
term hereof unless sooner terminated in accordance
wi th the provision hereof, or applicable law or
rules of Board.
SECTION 2. CROSS DEFAULT
A. If Grantee should be in default under any of the terms or
provisions of a franchise, or acceptance thereof, of another
city (then a party to a Joint Powers Agreement relating to
the System), at City's option, to be exercised by notice to
Grantee given at any time while such default exists, such
defaul t may be deemed by City a default by Grantee under
this Franchise.
B.
This section, or any other section or provision of
Franchise, shall not be deemed to incorporate into
Franchise by reference any other franchises.
this
this
67
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ARTICLE X.
FORECLOSURE, RECEIVERSHIP AND ABANDONMENT
SECTION 1. FORECLOSURE
Upon the foreclosure or other judicial sale of all or a part
of the System, Grantee shall notify City of such fact and such
notification shall be treated as a notification that a change in
control of Grantee has taken place, and the provisions of this
Franchise governing the consent to transfer or change in owner-
ship shall apply without regard to how such transfer or change in
ownership occurred.
SECTION 2.
RECEIVERSHIP
City shall have the right to cancel this Franchise 120 days
after the appointment of a receiver or trustee to take over and
conduct the business of Grantee, whether in receivership, reorga-
nization, bankruptcy or other action or proceeding, unless such
receivership or trusteeship shall have been vacated prior to the
expiration of said 120 days, or unless:
(a) Within 120 days after his election or appointment, such
receiver or trustee shall have fully complied with all
the provisions of this Franchise and remedied all de-
faults hereunder~ and
(b) Such receiver or trustee, within said 120 days, shall
have executed an agreement with City 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 Franchise.
68
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SECTION 3.
ABANDONMENT
Grantee may not abandon any portion of System without having
given not less than three months prior notice to City and Board.
Further, Grantee may not abandon any portion of System without
compensating City for damages resulting from the abandonment.
The amount of damages resulting from abandonment and due City
shall be determined in the sole discretion of City. An abandon-
ment of any portion of the System as determined in the sole dis-
cretion of City shall be a cause for termination of this Fran-
chise by City.
69
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ARTICLE XI.
PURCHASE OF SYSTEM
SECTION 1. GENERAL
A. If at any time Grantee offers System for sale, City shall
have the right to purchase System. If at any time Grantee
receives a bona fide purchase offer for the System which
Grantee is willing to accept, a complete copy of such offer
shall promptly be given to City and City shall have the
right to purchase the System according to the terms of that
offer. City shall exercise such right by submitting to
Grantee, within 60 days after City's actual receipt of the
bona fide offer, notice that City desires to purchase the
System pursuant to said offer. If City does not exercise
such right the System may be sold, but only on the terms
submitted to City. If any changes are made in the purchase
offer given to City, such purchase offer, as so changed,
shall again be given to City and City shall have 60 days
from actual receipt by City of the offer, as changed, within
which to exercise its right to purchase the System pursuant
to the offer, as changed, all as above provided. If City
does not exercise its right to purchase the System pursuant
to any offer given to City pursuant to this paragraph, and
the System is not sold to the buyer and on the terms set out
in the offer given to City, then the right of City to pur-
chase the System shall continue, and all subsequent purchase
offers shall be given to City pursuant to this paragraph.
Also, the City's right to purchase pursuant to this
70
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paragraph shall survive every sale to a buyer and shall
continue and be binding upon every buyer of the System.
B. Upon forfeiture, revocation or termination of this Fran-
chise, or at the normal expiration of the Franchise term,
City shall have the right to purchase the System. Such
right shall be exercised upon written notice to Grantee
within six months after the occurrence of any such event.
SECTION 2.
PROCEDURES
In the event City elects to exercise its right to purchase
the System as provided in Section 1B of this Article, the follow-
ing shall then apply:
A. City and Grantee shall negotiate all terms and conditions of
the purchase of the System.
B. If City and Grantee cannot agree upon the terms and condi-
tions of the purchase, City shall have the right to proceed
to arbitration. Arbitration shall commence and proceed ac-
cording to applicable Minnesota law except as follows:
(1) The parties shall, within 15 days of City's decision to
proceed to arbitration, appoint one arbitrator each who
is experienced and knowledgeable in the purchase and
valuation of business property. Arbitrators shall each
agree upon the selection of a third arbitrator, simi-
larly qualified, wi thin 15 days after appointment of
the second arbitrator.
(2) Within 30 days after appointment of all arbitrators and
upon ten days written notice to parties, the arbitrat-
ors shall commence a hearing on the terms and
71
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conditions of the purchase in dispute.
(3) The hearing shall be recorded and may be transcribed at
the request and expense of either party. All hearing
proceedings, debates and deliberations shall be open to
the public and at such times and places as contained in
the notice or as thereafter publicly stated in the or-
der to adjourn.
(4) The arbitration panel shall be required to determine
the purchase price of the System according to the stan-
dards established in paragraph C below.
(5) At the close of the hearings and within 30 days, the
arbitrators shall prepare written findings and make a
written decision agreed upon by a majority of the arbi-
trators which shall be served by mail upon City and
Grantee.
(6) The decision of a majority of the arbitrators shall be
binding upon both parties except that City may, in its
sole discretion and without any penalty or cost to City
of any kind, withdraw its offer to purchase within 90
days of receipt of the final decision of a majority of
the arbitrators.
(7) Either party may seek judicial relief to the extent
authorized under Minnesota Statutes, S572.09 and
S572.19 as the same may be amended, and in addition,
under the following circumstances:
(a) A party fails to select an arbitrator~
(b) The arbitrators fail to select a third arbitrator~
72
'- ~.
(c) One or more arbitrator is unqualified~
(d) Designated time limits have been exceeded~
(e) The arbitrators have not proceeded expeditiously~
or
(f) Based upon the record the arbitrators abused their
discretion.
(8) In the event a Court of competent jurisdiction deter-
mines the arbitrators have abused their 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.
(9) Cost of arbitration shall be borne equally.
C. In the event of forfeiture, revocation or termination, the
purchase price of the System shall be the fair market value
of material and equipment in place. Good will shall not be
included in the purchase price of the System.
D. In the event City is purchasing upon normal expiration of
the Franchise, the purchase price shall be the value of an
ongoing business.
E. Grantee expressly waives its rights, if any, to relocation
costs that might otherwise be provided by law.
F. The date of valuation shall be no earlier than the day fol-
lowing the date of revocation, forfeiture, expiration or
termination of this Franchise and no later than the date
City makes a written offer for the System.
73
,,>
ARTICLE XII.
MISCELLANEOUS
SECTION 1. 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 City,
which consent shall not be unreasonably withheld. Further,
Grantee shall not sell or transfer any stock or ownership
interest so as to create a new controlling interest except
with the consent of City, which consent shall not be unreas-
onably withheld. The transfers described in this paragraph
shall, in the sole discretion of City, be considered sale or
transfer of Franchise within the meaning and intent in the
following paragraph.
B. Any sale or transfer of Franchise, including a sale or
transfer by means of a fundamental corporate change, re-
quires the written approval of City. Any sale or transfer
of Franchise shall be subject to the provisions of Board
rules prohibiting certain ownership. The parties to the
sale or transfer of Franchise shall make a written request
to City for its consent. City shall reply in writing within
30 days of actual receipt of the request and shall indicate
its approval of the request or its determination that a pub-
lic hearing is necessary. City shall conduct a public hear-
ing on the request within 30 days of such determination if
74
"
it determines that a sale or transfer of Franchise may ad-
versely affect the Grantee's subscribers.
C. Unless otherwise already provided for by local law, notice
of any such hearing shall be given 14 days prior to the
hearing by publishing notice thereof once in a newspaper of
general circulation in the City. The notice shall contain
the date, time and place of the hearing and shall briefly
state the substance of the action to be considered by City.
Within 30 days after the public hearing, City shall approve
or deny in writing the sale or transfer request.
D. Any sale or transfer of Franchise, including a sale or
transfer by means of a fundamental corporate change, re-
quires notification to the Board by City. The notification
shall be accompanied by the written certification of the
transferee that it meets all of the requirements established
by City for original Grantee including but not limited to
technical ability and financial stability. City shall cause
to be sent to the Board at Grantee's expense a copy of all
public documents related to sale or transfer of the Fran-
chise.
E. The parties to the sale or transfer of only this Franchise,
without the inclusion of the System in which at least sub-
stantial construction has commenced, shall be required to
establish to the sole satisfaction of City that the sale or
transfer of only this Franchise is in the public interest.
F. For purposes of this section, fundamental corporate change
means the sale or transfer of a controlling interest in the
75
,'t
"
stock of a corporation or the sale or transfer of all or a
majority of a corporation's assets, merger (including a par-
ent and its subsidiary corporation), consolidation or crea-
tion of a subsidiary corporation. For the purposes of this
section, fundamental partnership change means the sale or
transfer of all or a majority of a partnership's assets,
change of a general partner in a limited partnership, incor-
poration of a partnership, or change in the control of a
partnership.
G. The word "control", as used herein, is not limited to major
stockholders, but includes actual working control in what-
ever manner exercised. As a minimum, "control", as used
herein, means a legal or beneficial interest (even though
actual working control does not exist) of at least five (5%)
percent. Every change, transfer or acquisition of control
of Grantee shall make the Franchise subject to cancellation
unless and until City shall have consented in writing there-
to, which consent shall not be unreasonably withheld. For
the purpose of determining whether it shall consent to such
change, transfer or acquisition of control, City may inquire
into the qualifications of the prospective controlling par-
ty, and Grantee shall assist City in any such inquiry and
pay all costs incurred by City in so inquiring, including
City staff time at a value determined by City.
H. In the absence of extraordinary circumstances, City will not
approve any transfer or assignment of the Franchise prior to
substantial completion of construction of System, as
76
"
determined solely by City.
I. In no event shall a transfer or assignment of ownership or
control be approved without transferee becoming a signator
to this Franchise.
J. Any transferee shall be subordinate to any right, title or
interest of City.
SECTION 2. REMOVAL AFTER TERMINATION OR REVOCATION
A. At the expiration of the term for which this Franchise is
granted, or upon its revocation or termination, as provided
for herein, City shall have the right to require Grantee to
remove, at Grantee's expense, all or any portion of the Sys-
tem from all streets and public property within City. In so
removing the System, Grantee shall refill and compact at its
own expense any excavation that shall be made by it and
shall leave all streets and public property in as good a
condition as that prevailing prior to Grantee's removal of
the System, and without affecting, altering or disturbing in
any way electric, telephone or other utility cables, wires
or attachments. City shall have the right to inspect and
approve the condition of such streets and public property
after removal. The Letter of Credit, Bonds, Insurance, In-
demnity and Penalty provisions of this Franchise shall re-
main in full force and effect during the entire term of re-
moval.
B. If, in the sole discretion of City, Grantee has failed to
commence removal of System, or such part thereof as was des-
ignated by City, within 30 days after written notice of
77
"
City's demand for removal is given, or if Grantee has failed
to complete such removal within one year after written no-
tice of City's demand for removal is given, City shall have
the right to exercise one of the following options:
(1) Declare all right, title and interest to the System to
be in City with all rights of ownership including, but
not limited to, the right to operate the System or
transfer the System to another for operation by it.
(2) Declare the System abandoned and cause the System or
such part thereof, as City shall designate, to be re-
moved at no cost to City. The cost of said removal
shall be recoverable from the Letter of Credit, Bonds,
Insurance, Indemnification and Penal ties provided for
in this Franchise, or from Grantee directly as a liqui-
dated damage.
C. Any portion of the System not designated by City for removal
shall belong to and become the property of City without pay-
ment to Grantee and Grantee shall execute and deliver such
documents, as City shall request, in form and substance ac-
ceptable to City, to evidence such ownership by City.
SECTION 3. WORK PERFORMED BY OTHERS
A. Grantee shall give notice to City specifying the names and
addresses of any other entity, other than Grantee, which
performs services pursuant to this Franchise, provided, how-
ever, that all provisions of this Franchise remain the re-
sponsibility of Grantee.
B. All provisions of this Franchise shall apply to any
78
subcontractor or others performing any work or services
pursuant to the provisions of this Franchise.
SECTION 4. INTEREST RATE
For purposes of this Franchise, prime rate shall mean the
interest charged from time to time by the First National Bank of
Minneapolis for 90 day unsecured loans to commercial borrowers of
the highest credit rating.
SECTION 5. GENERAL PROVISION ON RIGHTS AND REMEDIES
A. All rights and remedies given to City by this Franchise
shall be in addition to and cumulative with any and all oth-
er rights or remedies, existing or implied, now or hereafter
available to City at law or in equity, and such rights and
remedies shall not be exclusive, but each and every right
and remedy specifically given by this Franchise or otherwise
existing or given may be exercised from time to time and as
often and in such order as may be deemed expedient by City,
and the exercise of one or more rights or remedies shall not
be deemed a waiver of the right to exercise at the same time
or thereafter any other right or remedy. No delay or omis-
sion of City in the exercise of any right or remedy shall
impair any such right or remedy, nor shall any such delay or
omission be construed to be a waiver of or acquiescence to
any default. The exercise of any such right or remedy by
City shall not release Grantee from its Obligations, or any
liability, under this Franchise.
B. In addition to all other remedies granted or available to
City, City shall be entitled to the restraint by injunction
79
,
.'
.'
of the violation, or attempted or threatened violation, by
Grantee of any terms or provisions of this Franchise, or to
a decree compelling performance by Grantee of any term or
provision of this Franchise.
SECTION 6.
APPLICABLE LAWS AND COURT DECISIONS: SEVERABILITY
A. This Franchise shall at all times be in compliance with the
rules of the Board.
B. Grantee and City shall, at all times, comply with all laws,
ordinances and regulations of federal, state and City gov-
ernment relating to System and this Franchise, as they be-
come effective.
C. If any law, ordinance or regulation shall require or permit
Grantee to perform any service or shall prohibit Grantee
from performing any service which may be in conflict with
the terms of this Franchise, then as soon as possible fol-
lowing knowledge thereof, Grantee shall notify City of the
point of conflict believed to exist between such law, ordi-
nance or regulation and this Franchise.
D. If City determines that any provision of this Franchise is
affected by such law, ordinance or regulation, City shall
have the right to amend, modify, alter or repeal any of the
provisions of this Franchise to such reasonable extent as
may be necessary to carry out the intent and purpose of this
Franchise, and Grantee hereby agrees to such amendment, mod-
ification, alteration or repeal of this Franchise.
E. To the extent any provision of the Offering is not specific-
ally set out in this Franchise or not validly incorporated
80
,
c
herein by reference, City from time to time may amend this
Franchise to include such provision effective as of the date
of commencement of the Franchise term or any such rule ef-
fective as of the date of commencement of the Franchise term
or adoption of the rule, whichever is later. Grantee, by
acceptance of this Franchise, consents to and agrees to be
bound by any such amendments.
F. If any term, condition or provision of this Franchise or the
application thereof to any person or circumstance shall, to
any extent, be held to be invalid or unenforceable, the re-
mainder hereof and the application of such term, condition
and provision to persons and circumstances other than those
as to whom it shall be held invalid or unenforceable shall
not be affected thereby, and this Franchise and all the
terms, provisions and conditions hereof shall, in all other
respects, continue to be effective and to be complied with.
SECTION 7. GRANTEE ACKNOWLEDGMENT OF VALIDITY OF FRANCHISE
Grantee acknowledges that it has had an opportunity to re-
view the terms and conditions of this Franchise and that under
current law Grantee believes that said terms and conditions are
not unreasonable or arbitrary, and that Grantee believes the City
has the power to make the terms and conditions contained in this
Franchise.
81
SECTION 1.
ARTICLE XIII.
ADMINISTRATION AND ADVISORY BODY
ADMINISTRATOR
The City Administrator or the City Administrator's designee
shall be responsible for the continuing administration of this
Franchise. The administrator may be changed by City from time to
time by written notice given to Grantee.
SECTION 2.
ADVISORY BODY
City may appoint an advisory body to monitor the performance
of Grantee in executing the provisions of this Franchise. The
advisory body shall perform all functions required of it by the
Council and applicable laws, ordinance, rules and regulations.
SECTION 3. DELEGATION OF AUTHORITY BY CITY
A. City reserves the right to delegate and redelegate from time
to time any of its rights or obligations under this Fran-
chise to any body or organization.
B. Any delegation by City shall be effective upon written no-
tice by City to Grantee of such delegation.
C. Upon receipt of notice by Grantee of City's delegation,
Grantee shall be bound by all terms and conditions of this
delegation not in conflict with this Franchise.
D. Any such delegation, revocation or redelegation, no matter
how often made, shall not be deemed an amendment to this
Franchise or require any consent of Grantee.
82
ARTICLE XIV.
JOINT SYSTEM, ACCEPTANCE,
INCORPORATION OF OFFERING, EXHIBITS, PUBLICATION
SECTION I.
OTHER FRANCHISES
A. The System intended for City may be part of a joint system
that serves the cities of Andover, Anoka, Champlin and
Ramsey, Minnesota.
B. Grantee will, in good faith, apply for and accept, if of-
fered to it, a franchise (similar franchise) from each of
the other cities on all the same terms and conditions herein
provided, except provisions omitted as inapplicable.
C. Notwi thstanding any other provision of this Franchise, if
less than all of the other of said cities offer a similar
franchise to Grantee, which is accepted by Grantee, Grantee
or City may cancel this Franchise and all of their obliga-
tions hereunder by written notice given to the other not
later than 30 days after all the other of said cities shall
have formally acted upon their respective franchise ordi-
nances~ provided, that if Grantee elects to cancel this
Franchise pursuant hereto , it must also cancel all other
franchises granted to it by the other of said cities effec-
tive simultaneously herewith.
SECTION 2.
TIME OF ACCEPTANCE~ GUARANTEE~ INCORPORATION OF
OFFERING~ EXHIBITS
A. Grantee shall have 30 days from the last date of adoption of
a similar franchise by all of the cities listed in Section
IA of this Article, to accept this Franchi se in form and
substance acceptable to City.
However, in no event will
83
acceptance occur later than 90 days after the adoption of
this Franchise, unless the time for acceptance is extended
by City. Such acceptance by Grantee shall be deemed the
grant of this Franchise for all purposes.
B. Upon acceptance of this Franchise, Grantee shall be bound by
all the terms and conditions contained herein. Grantee
shall provide all services and offerings specifically set
forth in the Offering to provide cable communication service
wi thin City and other cities included in or a part of a
j oint system~ and, by its acceptance of this Franchise,
Grantee specifically agrees that the Offering of Grantee,
including all promises, offers, representations and induce-
ments contained therein, is specifically incorporated by
reference and made part of this Franchise. The failure to
refer to the Offering in any specific provisions of this
Franchise shall not be a limitation on the obligation of
Grantee to fully comply with the Offering. Grantee further
acknowledges that all promises, offers, representations and
inducements contained in the Offering of Grantee were freely
and voluntarily made to City by Grantee.
C. The Offering shall be permanently kept and filed in the Of-
fice of the City Clerk and the originals or reproductions
thereof shall be available for inspection by the public dur-
ing normal business hours. Also, the Grantee may summarize
the Offering in a manner acceptable to City or reproduce the
entire Offering, and shall have either at the following lo-
cations in the following quantities:
84
(I) Office of the City Clerk - 1 copy~
(2) Administrator designated in this Franchise - 1 copy~
(3) Public libraries - 1 copy each~
(4) Office of the City Attorney - 1 copy~
(5) Anoka and Hennepin County Law Library - 1 copy each~
(6) Local office of Grantee - 1 copy each~
(7) Office of any School District in City 1 copy~
(8) Minnesota Cable Communication Board.
D. In the event of conflicts or discrepancies between any part
of the Offering and the provisions of this Franchise or be-
tween any part of the summary made by Grantee and the Offer-
ing, those provisions which provide the greatest benefit to
City, in the opinion of the Council, shall prevail.
E. Grantee shall have continuing responsibility for this Fran-
chise, and if Grantee be a subsidiary or wholly owned cor-
porate entity of a parent corporation, performance of this
Franchise shall be secured by guarantees of the parent cor-
poration in form and substance acceptable to City, which
shall be delivered at time of, and as part of, acceptance of
this Franchise.
F. With its acceptance, Grantee also shall deliver to City an
opinion from its legal counsel, acceptable to City, stating
that this Franchise has been duly accepted by Grantee, that
the guarantees have been duly executed and delivered, that
this Franchise and the guarantees are enforceable against
Grantee and the guarantors in accordance with their respec-
tive terms, and which opinion shall otherwise be in form and
85
,,'
substance acceptable to City.
G. With its acceptance, Grantee also shall deliver to City true
and correct copies of documents creating Grantee and evi-
dencing the power and authority referred to in the opinion
of 'Grantee's counsel, certified as of a then current date by
by an officer of Grantee.
public office holders to the extent possible and otherwise
H. Each exhibit is part of this Franchise and each is specific-
ally incorporated herein by reference. The exhibits are as
follows:
Exhibit A - Grantee Schedule of Rates
Exhibit B - Form G, Page 2 of 20
Exhibit C - Offering of Grantee
Passed and adopted this ;2D tJ- day of
r2J
f
, 1982.
CITY OF ANDOVER
~.A'_ t-:'
By Mffo~ 7r-
L J~~
This Franchise is accepted, and we agree to he bound by all
its terms and conditions.
TELEPROMPTER OF QUAD CITIES,
INC.
DATED;
By
Its
By
Its
86
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59A
AN ORDINANCE AMENDING ORDINANCE NO. 59, ADOPTED THE 20TH DAY
OF APRIL, 1982, COMMONLY KNOWN AS THE CABLE COMMUNICATIONS
ORDINANCE FOR THE CITY OF ANDOVER,MINNESOTA.
THE CITY COUNCIL OF THE CITY OF ANDOVER HEREBY ORDAINS:
Ordinance No. 59, The Cable Communications Ordinance, adopted
the 20th day of April, 1982, is hereby amended as follows:
Page 5, Article 1, Section 2N (Amended portion of the following
is shown as underlined)
"Offering of Grantee" or "Offering" shall mean that certain
document dated August 19, 1981, entitled "Application for
Cable Television Franchise" and signed by Grantee, as amended
from time to time by mutual written agreement between the
Grantee and City or its delegatee, which document is on file
with the City Clerk.
Approved and adopted by the City Council of the City of Andover
this
7th
day of
December
, 1982, by unanimous vote.
CITY OF ANDOVER
ATTEST:----~
,J' .'./
. - -;~x-'- , Ken
--;-- /}//' 'J. / I I
'- / / / I ;,. ..../
~"{./~:/!:t."4 / 1>1, ~,,;l--<'''~'<, ~,/r-
Patricia K. L:tndqufst/"City Clerk
/ :/,/
II ./-'
'.-
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59B
AN ORDINANCE AMENDING ORDINANCE NO. 59, KNOWN AS THE CABLE
ORDINANCE, REGARDING THE FRANCHISE AGREEMENT BETWEEN THE
CITY OF ANDOVER AND GROUP W CABLE COMPANY, INC.
THE CITY COUNCIL OF THE CITY OF ANDOVER HEREBY ORDAINS:
Ordinance No. 59, adopted the 20th day of April 1982, is hereby
amended as follows:
ARTICLE VI. SYSTEMS OPERATIONS
SECTION 4. FRANCHISE FEES, RATES, CHARGES, CHANGES IN FEES AND
PROCEDURES.
I
J
Article VI, Section 4, Paragraphs A, B, C, and 0 are amended to
require that throughout the term of the franchise, Group W
shall pay to the City an annual fee of 5% of all gross revenues.~
The rates provided in the franchise shall be guaranteed for 2
years and 6 months after commencement of cable service to the
residential subscribers on October 20, 1983. Basic rates shall
be regulated pursuant to the terms and conditions of the franchise
allowing changes in rates unless the City specifically disapproves
such changes. Rates for other than basic service shall be
regulated pursuant to the terms and conditions of the franchise.
This section further details the procedures for the regulation
of other than basic service rates in the event the law should
provide for their regulation. / '"
c
Adopted by the City Council of the City of Andover this 20th
day of
November
, 1984.
CITY OF ANDOVER
\
"
ORDINANCE SUMMARY
\
\
I
Ordinance No. 59C
City of Andover
AN ORDINANCE AMENDING ORDINANCE NO. 59 REGARDING
THE FRANCHISE AGREEMENT BETWEEN THE CITY OF ANDOVER
AND GROUP W CABLE OF THE QUAD CITIES, INC.
The Council of the City of Andover does ordain:
l. Article VI. SYSTEMS OPERATIONS
Franchise Fees, Rates, Charges, Changes
in Fees and Procedures
Section 4.
The franchise fee specified in Article VI, Section
/.B'_l~) of the Franchise Agreement is amended to provide
~~uarterly payments of franchise fees will be made
withfn ninety (90) days after end of each quarter with
adjustments at year end for actual Gross Revenues'J:~ / ,,: /,Ji
2. Amended Exhibit A - Rates '
')'
./ (
1
Group Wls Schedule of Rates and Services as set
forth in Exhibit A to the Franchise Agreement is amended
in its entirety to provide for the rates and services as
set forth in Attachment II of Amendment Agreement No.
2. The complete Attachment II is available for inspec-
tion at the city offices.
These amendments shall take effect and be enforced
after their passage and official publication.
The amendments were passed and adopted the l7th day
of December , 1985.
CITY OF ANDOVER
ATTEST:
~k' "'~$'..p
J ry indschltl, Mayor
',1
~-:.~-
/
. L.----/ . /
i\.... ..,''\ "i.-'-~C
a A. Peach, City Clerk/Treasurer
.'
RATES
I. Teleprompter of Quad Cities. Inc.. shall charge the following installation charges
and monthly fees for its various services:
Tier I.! 25 video channels
Mini-Basic Service
Installation
2
Charge-
Monthly
3
Rate-
First Outlet
Additional Outlets
Relocation
Reconnection
$19.95 4
Free/$19.95-
$19.95
$19.95
$ 5.95
$ 2.95
Not applicable
Not applicable
Tier II.!
Basic Service
48 video channels
Installation
2
Charge-
Monthly
3
Rate-
First Outlet
Additional Outlets
Relocation
Reconnection
$19.95 4
Free/$19.95-
$19.95
$19.95
$10.95
$ 3.95
Not applicable
Not applicable
Tier III.!
Interactive
Service
52 video channels
FM Radio Servic~
Installation Monthly
2 3
Charge- Rate-
$19.95 4 $12.95
Free/$19.9s.:.
$19.95 Not applicable
$19.95 Not applicable
Installation Monthly
2 3
Charge- Rate-
4 $ 2.50
Free/$19.954
Free/$19.95- $ 2.50
$19.95 Not applicable
$19.95 Not applicable
Installation Monthly
Charge Rate
$99.00 6 $15.952-
and up-
First Outlet
Additional Outlets
Relocation
Reconnection
First Outlet
Additional Outlets
Relocation
Reconnection
Teleprompter Security
(Burglar/Fire Alarm and
Medical Alert Services
A-I
.
.>'
1With the Mini-Basic Service, one mInI-pay TV service, Home Theater Network, is
available for an additional monthly service charge. With the Basic and Interactive
Services, all premium pay TV services are available each for additional monthly
service charges. Additional installation charges are required if installed sepa-
rately from any service.
2No installation charge for Mini-Basic, Basic or Interactive Service for 90 days
after cable service is first offered in an area. No installation charge for senior
citizen or handicapped heads of households. In addition, installation charges may
be waived or reduced at certain times for promotional purposes.
3Fifteen percent (15%) discount for senior citizens (heads of households, age 65
and over) and for handicapped heads of households (as defined by State of
Minnesota) on Monthly Service Charges for the Mini-Basic, Basic and Interactive
Services; this excludes Teleprompter's security service.
4Installation is free if installed at same time as first outlet for cable television
service; $19.95 if installed at a later date.
5Not available without cable television service.
6Installation charge for Teleprompter Security Service depends upon the number of
monitoring devices (e.g., smoke detectors, emergency alert buttons) subscriber
wishes to have installed. Teleprompter will actively seek federal aid to assist
senior citizens in their payment of these services. The Security Service is
available with or without other cable services.
7 Final price contingent on conclusion of negotiations with local monitoring com-
panies.
A-2
.
."
II. A. Commercial-Account Charges--All hotels, motels, TV retail and service
stores, nursing homes, and hospitals.
The maximum monthly service charge per outlet of commercial usage is 50
percent of the residential first-set rate for the same service. Installation
charges will be determined on an individual basis after an engineering sur-
vey of the facility has been completed. In no event will the charges exceed
the standard installation charge on a per-unit basis.
B. Bulk-Rate Account Charges--All apartment buildings, condominiums, trailer
parks, etc., having flve or more single-family dwellings at the same or
contiguous service address with single point billing.
Billing for bulk-rate accounts is based on total units, whether occupied or
not. The maximum monthly service charge per outlet for this category is 80
percent of the residential first-set rate for the same service. Installation
charges will be determined on an individual basis after an engineering sur-
vey of the facility has been completed. In no event will the charges exceed
the standard installation charge on a per-unit basis.
C. Installation Over 200 Feet--For installation of service drops longer than 200
feet, the resident will be charged an additional amount for the installation
equal to the incremental increase of the cost of time and materials for every-
thing longer than 200 feet.
D . Miscellaneous
1. There is no charge to subscribers for cable-related maintenance and
repair calls.
2.
There will be no charge for the first drop to government,
educational and non-profit users of the institutional network.
cial rates will be negotiated.
library,
Commer-
3. Teleprompter of Quad Cities will offer pay-per-view services at the
lowest possible rate pending the conclusion of contract negotiations with
vendors.
A-3
.
,-,
III. OTHER RATES
A. A converter deposit shall not be required.
B. Pay Cable Rates
Pay Service
Installation
Charge
Monthly
Rate
M. . P 1,2
Im- ay
Services
(Front Row)
(Home Theater Network, Plus)
Free
Free
$ 4.953,4
$ 6.953,4
Maxi _ pay1 , 2
Services
(Showtime, Home Box Office, Bravo!,
Cinemax, The Movie Channel, The
Entertainment Channel, Public
Subscriber Network)
Free
$10.953,4
1None of the pay television products on Teleprompter of Quad Cities' system
will be X-rated. Nonetheless, Teleprompter of Quad Cities will provide an
access code at no additional cost that will allow parents to "lock-out" pay
television programming that they believe should not be seen by their chil-
dren.
2With the Basic and Interactive Services all premium pay TV services are
available each for additional monthly service charges. Home Theater Network
is available with the Mini-Basic Service, for an additional monthly service
charge.
3There is a ten percent (10%) discount on pay-TV monthly service charges if
two or more pay-TV services are purchased.
4There is no additional charge for Pay services on additional outlets.
A-4
. '
,~
c. Studio and Equipment Usage
1. No charge is made to non leased access users.
2. Commercial
a. Studio production time
$100. per hour
$200. per hour
$ 50. per hour
$100. per hour
$100. per hour
$100. per hour
b. Remote production time
c. Supervision and instruction
d. Leased channel costs
e. System playback costs
f. Editing costs
2. Noncommercial
a. Studio production time
$ 50. per hour
$100. per hour
$ 25. per hour
$ 50. per hour
$ 50. per hour
$ 50. per hour
b. Remote production time
c. Supervision and instruction
d. Leased channel costs
e. System playback costs
f. Editing costs
A-5
.
v'>
D. Institutional Network
1. commercial and noncommercial rates for video, audio and data uses:
Data Transmission Rates:
2400 BAUD $ 85 per month
4800 BAUD -- $155 per month
9600 BAUD -- $295 per month
Over 9600 BAUD Negotiated
1
Teleconferencing -- $1-- per hour
2. installation charges:
Installation charges for institutional network users will be assessed
at Teleprompter's cost of installation for labor, material and over-
head.
3. rates for terminal equipment including installation, use, deposits, etc.:
Terminal equipment will be furnished and installed at Teleprompt-
er's cost of material, labor and overhead.
4. any other rates relating to the institutional networks.
E. Service to Governmental and Educational Facilities2
1. Installation Fees:
a. One cable outlet (per facility)
$ No charge
$ Time and Material
$ No charge
2.
b. More than one outlet (per facility)
Monthly Rate:
F. Leased Access and Teletex Viewdata Services
Leased access time is charged at $100 per hour. Videotext services depend-
ent on negotiation of rates with software suppliers.
1Rates are negotiable for multiple hours of use.
2These facilities will receive Tier I service and will be provided with 35-channel
programmable Jerrold Converters.
A-6
{I '
c i ,"
,
.
,l(
.
G. Advertising
1. Teleprompter of Quad Cities. Inc.. shall allocate channel time free of
charge for public service advertising by local noncommercial groups on
its locally originated and advertising-supported channels.
2. The commercial rate for advertising shall be $30.00 per 60-second spot
plus production costs.
3. Advertising time shall be initially allocated on the following channels:
0 Community Service Channel
0 Quad Cities Health Channel
0 Color Radar Weather/Time
0 ESPN
0 USA Network
0 Cable News Network
A-7
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Z
RATES
I. Teleprompter of Quad Cities, Inc., shall charge the following installation
charges and monthly fees for its various services:
1
Tier 1-
25 video channels
Mini- Basic Service
First Outlet
Additional Outlets
Relocation
Reconnect ion
Change of Service
1
Tier 11- 48 video channels
Basic Service
First Outlet
Additional Outlets
Relocation
Reconnect ion
Change of Service
1
Tier III- 52 video channel
Interactive
Service
First Outlet
Additional Outlets
Relocation
Reconnect ion
Change of Service
5
FM Radio Service-
Installation
2
Charge-
$19.95 4
Free/$19.95-
$19.95
$19.95
$10.00
Installation
2
Charge-
$19.95 4
Free/$19.95-
$19.95
$19.95
$10.00
Installation
2
Charge-
$19.95 4
Free/$19.95-
$19.95
$19.95
$10.00
installation
2
Charge-
~nthly
3
Rate-
$ 5.95
$ 2.95
N/A
N/A
N/A
Monthly
3
Rate-
$10.95
$ 3.95
N/A
N/A
N/A
~nthly
3
Rate-
$12.95
N/A
N/A
N/A
Monthly
3
Rate-
First Outlet
Additional Outlets
Relocation
Reconnect ion
Teleprompter Security
(Burgular/Fire Alarm and
Medical Alert Services)
Remote Control
A-1
4
Free/$19.95-
Free/$19.95~
$19.95
$19.95
Installation
Charge
6
$99.00 and up-
N/A
$ 2.50
$ 2.50
N/A
N/A
~nthly
Rate
7
$15.95-
$ 5.95
With the Mini-Basic Service, Home Theater Network, plus, is available for an
additional monthly service charge. With the Basic and Interactive Services,
all premium pay TV services are available each for additional monthly service
charges. Additional installation charges are required if installed separately
fran any service.
2 No installation charge for Mini-Basic, Basic or Interactive Service for 90
days after cable service is first offered in an area. No installation charge
for senior citizen or handicapped heads of households. In addition, installa-
tion charges may be waived or reduced at certain times for pranotional
purposes.
3 Fifteen percent (15%) discotmt for senior citizens (heads of households, age
65 and over) and for handicapped heads of households (as defined by State of
Minnesota) on M:>nthly Service Charges for the Mini-Basic, Basic and
Interactive Services; this excludes Telepranpter's security service.
4 Installation is free if installed at same time as first outlet for cable tele-
vision service; $19.95 if installed at a later date.
5 Not available without cable television service.
6 Installation charge for Teleprompter Security Service depends upon the number
of monitoring devices (e.g., smoke detectors, emergency alert buttons)
subscriber wishes to have installed. Teleprompter will actively seek federal
aid to assist senior citizens in their payment of these services. The
Security Service is available with or without other cable services.
7 Final price contingent on conclusion of negotiations with local monitoring
companies.
(
r
II.
A.
Commercial-Account Char~eS--AlI hotels,
stores, nursing homes, an hospitals.'
motels,
TV retail and
service
The maximum monthly service charge per outlet of commercial usage is 50
percent of the residential first-set rate for the same service. Installation
charges will be determined on an individual basis after an engineering sur-
vey of the facility has been completed. In no event will the charges exceed
the standard installation charge on a per-unit basis.
B. Bulk-Rate Account Charges--All apartment buildings, condominiums, trailer
parks, etc., having five or more single-family dwellings at the same or
contiguous service address with single point billing.
Billing for bulk-rate accounts is based on total units, whether occupied or
not. The maximum monthly service charge per outlet for this category is 80
percent of the residential first-set rate for the same service. Installation
charges will be determined on an individual basis after an engineering sur-
vey of the facility has been completed. In no event will the charges exceed
the standard installation charge on a per-unit basis.
C. Installation Over 200 Feet-- For installation of service drops longer than 200
feet, the resident will be charged an additional amount for the installation
equal to the incremental increase of the cost of time and materials for every-
thing longer than 200 feet.
D. Miscellaneous
1. There is no charge to subscribers for cable-related maintenance and
repair calls.
2.
There will be no charge for the first drop to government,
educational and non-profit users of the institutional network.
cial rates will be negotiated.
3. Teleprompter of Quad Cities will offer pay-per-view services at the
lowest possible rate pending the conclusion of contract negotiations with
vendors.
library,
Com mer-
A-3
III. OTHER RATES
A. A converter deposit shall not be required
B. Pay Cable Rates
Pay Service 1 ,2
Installation
Charge
Monthly
Rate
Bravo
Home Theater Network, Plus
Free5
Free5
$ 6.953,4
$ 6.953,4
Showtime, Home Box Office, Cinemax,
The M:>vie Channel, The Disney Channel
Free5
$10.953,4
None of the pay television products on Teleprompter of Quad Cities'
system will be X-rated. Nonetheless, Teleprompter of Quad Cities will
provide an access code at no additional cost that will allow parents
to "lock-out" pay television progranming that they believe should not
be seen by their children.
2 With the Basic and Interactive Services all premiun pay TV services
are available each for additional monthly service charges. Home
Theater Network Plus is available with Tier I for an additional.
monthly service charge.
3 There is a ten percent (10%) discount on pay-TV monthly service
chargesif two or more pay-TV services are purchased.
4 There is no additional charge for Pay services on additional outlets.
5 At time of initial installation. If added or deleted later, a $10.00
Change of Service Fee will be applied. The $10.00 fee is not per pre-
miun service but per occurrence of service change. ----
A-4
(
!
C. Studio and Equipment Usage
1. No charge is made to non leased access users.
2. Commercial
a. Studio production time $100. per hour
b. Remote production time $200. per hour
c. ~upervision and instruction $ 50. per hour
d. . Leased channel costs $100. per hour
e. ,System playback costs $100. per hour
f. Editing costs $100. per hour
2. NoncoI$lercial
a. S\udio production time $ 50. per hour
b. ,R:~mote production time $100. per hour
c. ~upervision and instruction $ 25. per hour
d. Leased channel costs $ 50. per hour
e. System playback costs $ 50. per hour
f. , Editing costs $ 50. hour
per
A-5
(
~
D. Institutional Network
1. commercial and noncommercial rates for video, audio and data uses:
Data Transmission Rates:
2400 BAUD $ 85 per month
4800 BAUD -- $155 per month
9600 BAUD -- $295 per month
Over 9600 BAUD -- Negotiated
1
Teleconferencing -- $1-- per hour
2. installation charges:
Installation charges for institutional network users will be assessed
at Teleprompter's cost of installation for labor, material and over-
head.
3. rates for terminal equipment including installation, use, deposits, etc.:
Terminal equipment will be furnished and installed at Teleprompt-
er's cost of material, labor and overhead.
4. any other rates relating to the institutional networks.
E. Service to Governmental and Educational Facilities2
1. Installation Fees:
a.
One cable outlet (per facility)
$ No charge
2.
b. More than one outlet (per facility)
Monthly Rate:
$ Time and Material
$ No charge
F. Leased Access and Teletex Viewdata Services
Leased access time is charged at $100 per hour. Videotext services depend-
ent on negotiation of rates with software suppliers.
lRates are negotiable for multiple hours of use.
2These facilities will receive Tier I service and will be provided with 35-channel
programmable Jerrold Converters. ,
A-6
. .
.
" ,
(
(
G. Advertising.
1. Teleprompter of Quad Cities, Inc.. shall allocate channel time free of
charge for pUblic service advertising by local noncommercial groups on
its locally originated and advertising-supported channels.
2. The commercial rate for advertising shall be $30.00 per 60'-second spot
plus production costs.
3. Advertising time shall be initially allocated on the following channels:
o Community Service Channel
o Quad Cities Health Channel
o Color Radar Weather/Time
o ESPN
o USA Network
'"
,
.
,
o Cable News Network
.."
A-7
,
,r
SECTION 4. FRANCHISE FEE, RATES, CHARGES, CHANGES IN FEES AND
PROCEDURES
A. Rate Change procedure.
(1) To the extent permitted by law, all increases in.
subscriber rates and charges shall be charged by
Grantee, in a manner provided for herein. Grantee, as a
condition precedent to its acceptance of this Franchise
hereby knowingly and voluntarily consents to these
procedures for the term of this Franchise of all rates
and charges.
(2) City hereby reserves the right to approve or adopt
regulations governing Grantee's collection of advance
charges and deposits, installation and reconnection
charges, policies and procedures, disconnection charges,
policies and procedures, and the availability of
refunds. Approval of City shall not be unreasonably
withheld or delayed.
(3) Cost for installing any part of the System will be a
factor in the rate only if such cost was incurred within
City.
(4) The territory for rates applicable to System shall be
City and all Cities then parties to a joint powers
agreement relating to the System.
0065:3/14/84
..,
"
.'
to City, within 60 days after the end of each fiscal
year of Grantee, an annual fee of five pe~gent (5%) of
9ross~evenues. No payment will be allowed of any
fee "that is different from five percent, other than the
. - .
'filing fee and payment required of the succes'sful
applicant as established by City to recover the cbsts of
franchising. Grantee agrees to support any waiver
required by the FCC for the established franchise fee.
The annual fee may be subject to renegotiation at such
time as federal or state authorities no longer regulate
the amount of the fee. If Grantee and City do not agree
in renegotiations, the Franchise fee shall remain
unchanged.
(2) Payment will be made to City with an itemization of the
'gross revenues derived from the services in City.
C. Rates and Other Charges.
(l) Rates and charges charged by Grantee for monthly service
and installation and other charges hereunder shall be
uniform, fair and reasonable and designed to meet all
necessary costs of service, including a fair rate of ,
return on the original cost, less depreciation, of the
properties devoted to such service (without regard to
any subsequent sale or transfer price or cost of such
properties).
0065:3/14/84
r'
I - 3
"
,- '~~-:::-.. ':':~~~I~;}~%:
. two' 'year 'S. 'and
, '
-. ,.:_.<--,-,~;;-~",:.->.." '. ~
- -,. :""'~'",. i';"-- .,::.,:___~;;;.i~;,~..:~~;:;~..~.,>~__.,>:~,::~~~,:,,~>,:_:_',_ .,'~, .,'
six months 'after commencement i)f'cahle '
. -. "::O_::c
. ',-. ,,--.. ,.,. .
service to the residential subscribers on October 20,
1983, the maximum rates shall be the specific rates of
Grantee as included in Exhibit A, attached hereto and
, ,
~ade a part of this Franchise and known as
Rates.
repair of Grantee's
property shall be performed at no charge to a
subscriber. If such maintenance or repair is required
as a result of damage caused by subscriber, Grantee may
charge to the subsc~iber as a maximum its direct costs
for material and labor for service calls to subscriber's
home.
(4) Grantee shall give City and the Quad Cities Cable
Communications Commission written notice of rates for
new or additional services not initially included in
Offering of Grantee and therefore not listed in Exhibit
A. Each new or additional service rate shall be deemed
approved unless expressly disapproved by re~olution of
Council of City according to the terms of this Franchise
within ninety (90) days after the notice has been given
as provided in this Franchise.
D. Rate Changes.
(l) No rate change shall be approved that would result in
different rates or charges for service to similarly
situated subscribers in the rate territory, other than
those specified in Article VI, Section 2.B.
0065:3/14/84
.'
1-4
a proposed ra.techaligewill
following:
(a) The ability of the Grantee to render System
services and to derive a reasonable profit
,
therefrom under the existing rate schedule and
proposed rate schedule;
(b) All revenues and profits or actual losses derived
from System~
(c) Tax benefits and tax costs received by Grantee, its
partners or shareholders, as the result of their
investment in the System;
(d) Cash flow generated by System;
(e) The efficiency of Grantee~
(f) The quality of the service offered by Grantee;
(g) The original cost of the System, less depreciation;
(h) A fair rate of return with respect to investments
having similar risks to that of providing cable
communication services~
(i) The extent to which Grantee has adhered to the
terms of this Franchise~
(j) Fairness to residents and subscribers;
(k) Capital expenditures (actual and, if the situation
so warrants, projected) by Grantee in providing
updated technology and service to subscribers;
(l) The extent to which Grante has then provided
service to schools, hospitals, libraries,. publicly
owned or leased buildings and similar institutions
within City;
nn~r:_""""~~A
'.
....c.._ .....,.__.
Grantee-has . techri~iogiC~ll:Y .
(n) Increased or decreased expenses incurred by Grantee
in the purchase of services; and
Such other factors as City or Grantee may deem
<relevant.
(j) ~he procedures to be ~ollowed in changing a Basic rate
or charge shall include at least the following:
(a) Grantee shall give City and the Quad Cities Cable
Communications Commission written notice of any
proposed rate increase at least ninety (90) days
prior to the proposed effective date of the rate
increase. Each rate increase shall be deemed
approved unless expressly disapproved by resolution
of Council of City according to the terms of this
Franchise within ninety (90) days after the notice
has been given as provided in this Franchise.
(b) The notice shall be supported by statistical and
other proof indicating that the existing rate or
.... ."
charge is inadequate and unreasonable and that the
proposed increases are required to enable Grantee
to render service to fulfill its obligations under
this Franchise and to derive a reasonable profit
therefrom.
(c) Upon written request by City or the Quad Cities
Cable Communications Commission The notice shall
include current financial and other information
with at least the following:
.'
I - 6
3. Statement of sources and applications
4. Detailed supporting schedules ,of, expenses,
income, assets and other items as may be
required by City:
- . . .
5. Statement of current and projected 'subscribers:
6. A current list of rates and charges of Grantee
applicable to systems owned or operated by its
parent corporation or other subsidiaries or
affiliates of its parent corporation at other
locations:
7. A current list of rates and charges for other
systems in the seven county Metropolitan area:
8. Cash flow derived from System services since
the commencement of this Franchise~ and
9. Statement of tax benefits received by Grantee,
its partners or shareholders, as a result of
their investment in System.
(d) In the event the proposed rate increase exceeds (in
any respect) the projected rate increases shown on
Exhibit B, City shall notify Grantee and Board ~nd
may schedule a public hearing on the proposed rate
increase within two weeks from the date of receipt
of the notice. Grantee will notify the public
through providing notice for one week, each day
between 7:00 p.m. and 9:00 p.m. on two lowest tier
0065:3/14/84
will publish notice ten days prior to hearing in
newspaper.
public hearing, City will have
to make its deter..mination;
proposed change.in rates or ,charges
shall become effective upon the date specified in
the notice of Grantee. The City shall not
unreasonably disapprove any rate increase.
(f) If City fails to disapprove the change of rate~ or
charges within the original ninety (90) day period
after receipt of notice as required above, the rate
shall still become effective upon the date
specified in the notice of Grantee. Said effective
date shall be after the ninety (90) day period.
(g) City may utilize a rate consultant to advise it on
proposed rate changes and to assist it in
maintaining uniform rates within the rate
territory. A rate consultant may be any person who
has sufficient background and experience, in the
sole opinion of City, to properly evaluate and
analyze ,rates and charges.
(h) All costs for the review of a notice for a rate or
charge change shall be paid by City from the
Franchise fee.
(i) Any time limit may be waived only if City and
Grantee consent.
rates of any new or
.service;
, "
or Grantee may initiate binding arbitFation pursuant
. . ..
to Minnesota Statutes e.xcept,asdelineatedbelow.
. , ,,,.~ -- ~
'(k) The parties :Sl1all,withirllS;days,o,fCltY'sexpress
di sapprovalby' resolut ion ''Of tbeCit yCouncil of
any rate increase, appoint one arbitrator each who
is experienced and knowledgeable in the evaluation
and analysis of cable rate and charge changes.
Arbitrators shall each agree upon the selection of
a third arbitrator, similarly qualified, within 15
days after appointment of the second arbitrator.
(l) Within l5 days after appointment of all arbitrators
and upon ten days written notice to parties, the
arbitrators shall commence a hearing on the rate
change proposed by Grantee.
(m) The hearing shall be recorded and may be
transcribed at the request and expens~of either
party. All hearing proceedings, debates and
deliberations shall be open to the public, City,
and Grantee and at such times and places as
contained in the notice or as thereafter publicly
stated in the order to adjourn.
(n) The arbitration panel shall be required to approve,
reject or modify the rate change proposed" by
Grantee according to the standards established in
this franchise.
1-9
o'f 'the
". .". .....
0' o/.;;;;~:.,':;.:I"~:~"
headn'gs ~~if~,:~w(th'
arbit~ators shall preparewri1:tenfinding$an~
"
. - .c." >
make a written decision agreed upon by, a majority
of the arbitrators which shall be served by mail
,
upon the City and Grantee.
The decision of a majority of
be binding upon both parties, provided
party may pursue any judicial remedies otherwise
available to either party.
(q) Should the rate change be rejected or modified by a
majority of the arbitrators, the Grantee shall
within ninety (90) days and pursuant to procedur~s
established by Grantee refund the rat.e overage to
affected subscribers.
(r) Either party may also seek jUdicial relief to the
extent authorized under Minnesota Statutes, Section
572.09 and Section 572.l9 as the same may be
amended, and in addition, under the following
circumstances:
(i) A party fails to select an arbitrator;
(ii) The arbitrators fail to select a third
arbitrator;
(iii) One or more arbitrator is unqualified;
(iv) De~ignated time limits have been exceeded;
(v) The arbitrators have not proceeded
expeditiously; or
(vi) Based upon the record the arbitrators abused
their discretion.
n"'~_~ ,...... In....
have' abused5tbeir ....
-. -', ,- ~
"
that the regulation of a given
. ,
is beyond the authority of the City"itmaY.Order
" '-. .,.-
the arbitration procedure .repeatedCln~issue' .?~;,,< ..
'-" '-."c
andOire~;~oi:!!l$,'W.i,.~~.;~?~~~>~f . ;Suit ,..
.- ;--.
charge other than basic shall include the following:
(a) Grantee shall give City written notice of any rate
increase at least ninety (90) days prior to the ,
effective date of the rate increase.
(b) In the event the percentage of the rate increase
(in any respect) does not exceed the percentage of
the increase from the CPI in existence on the date
of the certification of this Franchise by the Board
or specified in the last rate increase notice of
the Grantee (whichever event is most recent), the
.,. '0
..
noticed rate shall become effective' upon its
noticed effective date.
(c) Except as provided in Article VI, Section 4.,
D.(c)(5), in the event the percentage of the rate
increase (in any respect) exceeds the percentage of
increase from the CPI in existence on the date of
0065:3/14/84
~ "",;."" ,
Grantee (~hichever event is most recent), the
notice rateshallbec~m~ effecti~e.up~n its notice~
effective date but the notice shall also include
,.curren tfinanci81s~n4 otherinfotlllatlon
"'.""-"-"-;;".
specified in Artlc'ievI, Section <4.,
D. (4) ( c) (1. -9. ) .
(i) Upon review by City of the information
provided in the notice by Grantee, City may
schedule a pUblic hearing on the proposed
rate increase within two (2) weeks from the
date of receipt of the notice. Grantee will
notify the public as specified in 'Article
VI, Section 2., D.(4)(d). The City will
publish notice ten (10) days prior to the
hearing in its official newspaper.
(ii) After closing the public hearing, City will
have thirty-one (31) days withi~,which to
make any determination regarding the noticed
rate increase; however, any proposed change
in rates or charges shall become effective
upon the date specified in the notice of
Grantee regardless of the determination of
City.
(iii) The City may utilize a rate consultant to
advise it on proposed rate changes and to
assist it in maintaining uniform rates
>
",', ,.
evaluate and analy,ze rates and
, .; '-. -_:_<,~
.-'.--.
'.,:;(iv)
, .
>'Ail'(;~;;~:~S79~tl1fateview ,of .anotice(,tora
..,',.. r~f.e,,':~i'(:hargej:llange shall be paid by City
from the Franchise fee.
(5) In the event the law should provide for the regulation
of other than basic rate by City, the procedure for the
change of other than basic rates shall be as outlined
above, except that subsequent to the public hearing,
should the City disapprove the change of rates, either
City or Grantee may initiate binding arbitration
pursuant to Minnesota Statutes except as delineated in
Articie VI, Section 3., D.(k)-(t).
.
0065:3/14/84
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59A
AN ORDINANCE AMENDING ORDINANCE NO. 59, ADOPTED THE 20TH DAY
OF APRIL, 1982, COMMONLY KNOWN AS THE CABLE COMMUNICATIONS
ORDINANCE FOR THE CITY OF ANDOVER,MINNESOTA.
THE CITY COUNCIL OF THE CITY OF ANDOVER HEREBY ORDAINS:
Ordinance No. 59, The Cable Communications Ordinance, adopted
the 20th day of April, 1982, is hereby amended as follows:
Page 5, Article 1, Section 2N (Amended portion of the following
is shown as underlined)
"Offering of Grantee" or "Offering" shall mean that certain
document dated August 19, 1981, entitled "Application for
Cable Television Franchise" and signed by Grantee, as amended
from time to time by mutual written agreement between the
Grantee and City or its delegatee, which document is on file
with the City Clerk.
Approved and adopted by the City Council of the City of Andover
this
7th
day of
December
, 1982, by unanimous vote.
CITY OF ANDOVER
Ken
,
;t
~/r-
ity Clerk
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59B
AN ORDINANCE AMENDING ORDINANCE NO. 59, KNOWN AS THE CABLE
ORDINANCE, REGARDING THE FRANCHISE AGREEMENT BETWEEN THE
CITY OF ANDOVER AND GROUP W CABLE COMPANY, INC.
THE CITY COUNCIL OF THE CITY OF ANDOVER HEREBY ORDAINS:
Ordinance No. 59, adopted the 20th day of April 1982, is hereby
amended as follows:
ARTICLE VI. SYSTEMS OPERATIONS
SECTION 4. FRANCHISE FEES, RATES, CHARGES, CHANGES IN FEES AND
PROCEDURES.
Article VI, Section 4, Paragraphs A, B, C, and 0 are amended to
require that throughout the term of the franchise, Group W
shall pay to the City an annual fee of 5% of all gross revenues.
The rates provided in the franchise shall be guaranteed for 2
years and 6 months after commencement of cable service to the
residential subscribers on October 20, 1983. Basic rates shall
be regulated pursuant to the terms and conditions of the franchise
allowing changes in rates unless the City specifically disapproves
such changes. Rates for other than basic service shall be
regulated pursuant to the terms and conditions of the franchise.
This section further details the procedures for the regulation
of other than basic service rates in the event the law should
provide for their regulation.
Adopted by the City Council of the City of Andover this 20th
day of
November
, 1984.
CITY OF ANDOVER
-I
..__ -<-._ .--L---'
st-City Adm.jClerk
(=4..~ uL_' ~ ,~
~ry indschit - Mayor
Final Franchise
Andover. Minnesota
Prepared by:
Thomas D. Creighton
Dunkley and Bennett
1750 First Bank Place East
Pillsbury Center
200 South Sixth Street
Minneapolis, Minnesota 55402
(612) 339-1290
TABLE OF CONTENTS
STATEMENT OF INTENT AND PURPOSE
FINDINGS
ARTICLE I. SHORT TITLE AND DEFINITIONS
Page
1
1
Section 1. Short Title
Section 2. Definitions
3
3
ARTICLE II. GRANT OF AUTHORITY AND GENERAL PROVISIONS
Section 1. Grant of Franchise and Acceptance
Section 2. Authority Granted
Section 3. Agreement
Section 4. Franchise Term
Section 5. Area
Section 6. Police Powers
Section 7. Use of Grantee Facilities
Section 8. Written Notice
7
8
8
8
9
9
9
9
10
11
Section 9. Rights ofIndividuals
Section 10. Certificate of Confirmation
ARTICLE III. DESIGN OF SYSTEM
Section 1, Channel Capacity-Subscriber Network
Section 2. Picture Quality and Technical Requirements
Section 3. Two-Way Capacity
Section 4. Facilities
12
12
14
14
Section 5, Special Channel and Access Requirements
14
Section 6. Institutional Network
18
Section 7. Services to Public Buildings and Educational Institutions
18
Section 8. Interconnection
19
Section 9. Narrowcasting
19
Section 10, Regional Channel
19
ARTICLE IV. SERVICES AND PROGRAMMING, SUBSCRIBER CONTRACTS,
COMPLAINTS
Section 1. Services and Programming
21
Section 2. Interruption of Service and Complaints
21
ARTICLE V. CONSTRUCTION, INITIAL SERVICE AREA, LINE EXTENSION
AND CONSTRUCTION STANDARDS
Section 1. Initial Service Area
24
Section 2. Line Extension Policy
24
Section 3. Construction Timetable
25
Section 4. Construction Standards
26
Section 5. Conditions on Use
29
ARTICLE VI. SYSTEM OPERATIONS
Section 1. Information Availability
31
Section 2. Service Contract 32
Section 3. Subscriber Practices 34
Section 4. Franchise Fees, Rates, Charges, Changes in Fees and Procedures 35
A. Rate Change Procedures
35
B. Franchise Fee
36
ii
C, Rates and Other Charges 36
D. Rate Changes 37
E, Periodic Reviews, Renegotiation and Technological Update of 44
System
47
Section 5. Franchise Renewal
ARTICLE VII. (Reserved)
ARTICLE VIII. INDEMNIFICATION, INSURANCE, LETTER OF CREDIT AND
BOND
Section 1. General
50
Section 2. Indemnification and Insurance
50
Section 3. Insurance
52
Section 4. Letter of Credit
53
Section 5. Bonds
57
ARTICLE IX. DEFAULT
Section 1. Notice and Default
58
Section 2, Cross Default
60
ARTICLE X. FORECLOSURE, RECEIVERSHIP AND ABANDONMENT
Section 1. Foreclosure
61
Section 2. Receivership
61
Section 3. Abandonment
61
ARTICLE XI. PURCHASE OF SYSTEM
Section 1. General
63
Section 2. Procedures
64
iii
ARTICLE XII. MISCELLANEOUS
Section 1. Transfer of Ownership or Control
67
Section 2. Removal After Termination or Revocation
69
Section 3. Work Performed by Others
71
Section 4. Interest Rate
71
Section 5. General Provision on Rights and Remedies
71
Section 6, Applicable Laws and Court Decisions: Severability
72
Section 7. Grantee Acknowledgment of Validity of Franchise
73
ARTICLE XIII. ADMINISTRATION AND ADVISORY BODY
Section 1. Administrator
74
Section 2. Advisory Body
74
Section 3. Delegation of Authority by City
74
ARTICLE XIV. JOINT SYSTEM, ACCEPTANCE, INCORPORATION OF
OFFERING, EXHIBITS, PUBLICATION
Section 1. Other Franchises 75
Section 2. Time of Acceptance; Guarantee; Incorporation of Offering 75
Exhibits
iv
ORDINANCE NO. 59
AN ORDINANCE, INCLUDING ADDENDUM WITH EXHIBITS, GRANTING A
FRANCHISE TO TELEPROMPTER OF QUAD CITIES, INC., A MINNESOTA
CORPORATION, TO OPERATE AND MAINTAIN A CABLE COMMUNICATION
SYSTEM IN THE CITY; SETTING FORTH CONDITIONS ACCOMPANYING THE GRANT
OF FRANCHISE; PROVIDING FOR REGULATION, AND USE OF THE SYSTEM; AND
PRESCRlBING PENALTIES FOR THE VIOLATION OF ITS PROVISIONS
The City Council of the City of Andover ordains:
STATEMENT OF INTENT AND PURPOSE
The City intends, by the adoption of this Franchise, to bring about the development of a
System, and the continued operation of it. Such a development can contribute significantly to the
communication needs and desires of many. Further, the City may achieve better utilization and
improvement of public services with the development and operation of a Cable Communications
System.
Past studies, participated in by City, have led the way for organizing a means of
procuring and securing a Cable Communications System deemed best suited to the City, in the
judgment of the Council. This has resulted in the preparation and adoption of this Franchise.
FINDINGS
In the review of Grantee's proposal and application and as a result of the public hearings,
the City Council makes the following findings:
A. The Grantee's technical ability, financial condition, legal qualifications, and character
were considered and approved in a full public proceeding after due notice and reasonable
opportunity to be heard;
B. Grantee's plans for constructing and operating the System were considered and found
adequate and feasible in a full public proceeding after due notice and reasonable
opportunity to be heard;
C. The Franchise granted to Grantee by City complies with the existing applicable
Minnesota Statues and regulations and Franchise standards of Board; and
D, The Franchise granted to Grantee is nonexclusive.
2
SECTION 1,
ARTICLE I.
SHORT TITLE AND DEFINITIONS
SHORT TITLE
This Ordinance shall be known and cited as the Cable Communications Ordinance.
SECTION 2.
DEFINITIONS
For the purpose of the Franchise, 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. The words "shall" and
"will" are mandatory and "may" is permissive. Words not defined shall be given their common
and ordinary meaning.
A. "Basic Service" means all subscriber services provided by Grantee including the delivery
of broadcast signals, covered by the regular montWy charge paid by all subscribers,
excluding optional services for which a separate charge is made.
B. "Board" means the Minnesota Cable Communications Board.
C. "City" means City of Andover, a municipal corporation, in the State of Minnesota.
D. "Class IV Channel" means a signaling path provided by a System to transmit signals of
any type from a subscriber terminal to another point in System.
E. "Converter" means an electronic device, which converts signals to a frequency acceptable
to a television receiver of a subscriber, and by an appropriate channel selector permits a
subscriber to view all subscriber signals included in the service.
3
G. "Council" means the governing body of the City.
H. "Drop" shall mean the cable that connects the subscriber terminal to the nearest feeder
cable of the system.
1. "FFC" shall mean the Federal Communications Commission and any legally appointed,
designated or elected agent or successor.
1. "Grantee" is Teleprompter of Quad Cities, Inc., a Minnesota Corporation, its agents or
employees.
K. "Gross Revenues" shall mean all revenue derived directly or indirectly by Grantee, its
affiliates, subsidiaries, parent, and any person in which Grantee has financial interest of
five percent (5%) or more from or in connection with the operation of the System,
including but not limited to, basic subscriber service monthly fees, pay cable fees,
installation and reconnection fees, leased channel fees, converter rentals, studio rental,
production equipment and personnel fees, and advertising revenues. The term does not
include any taxes on services furnished by Grantee and imposed directly upon any
subscriber or user by the State, City or other governmental unit and collected by Grantee
on behalf of said governmental unit or any revenues derived from a feed originating in or
passing through City and destined for a location outside City.
L. "Installation" means the connection of the System from feeder cable to the point of
connection.
M. "Lockout Device" is an optional mechanical or electrical accessory to a subscriber's
terminal which inhibits the viewing of a certain program, certain channel or certain
channels provided by way of the cable communications system.
4
N. "Offering of Grantee" or "Offering" shall mean that certain document dated August 19,
1981, entitled "Application for Cable Television Franchise" and signed by Grantee, as
amended from time to time by mutual written agreement between the Grantee and City or
its delegatee, which document is on file with the City Clerk (59A, 12/7/82).
O. "Public Property" is any real property owned by City other than a street.
P. "Scramb1er/Descrambler" refers respectively to the equipment installed in the cable
communication system's headend equipment and subscriber terminal used to isolate pay
cable and other ancillary service channels from basic service which is accomplished by
electronically distorting the signal prior to its transmission through the cable
communications system and reconstituting the signal at each authorized location for
subsequent display.
Q. "Sidewalk" is the portion of a street delineated for pedestrian travel.
R. "Street" shall mean the surface of and the space above and below any public street, road,
highway, freeway, lane, path, public way, alley, court, sidewalk, boulevard, parkway,
drive or any easement or right-of-way now or hereafter held by City which shall, within
its proper use and meaning in the sole opinion of City, entitle Grantee to the use thereof
for the purpose of installing or transmitting over poles, wire, cables, conductors, ducts,
conduits, vaults, manholes, amplifiers, appliances, attachments and other property as may
be ordinarily necessary or pertinent to a System.
S. "Subscriber" means any person or entity who subscribes to a service provided by Grantee
by means of or in connection with the System regardless of whether a fee is paid for such
servIce.
5
T. "System" means 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, amplifying and distributing, audio, video and other
forms of electronic or electrical signals, located in City, Said definition shall not include
any system wholly internal to one or more multiple unit dwellings under common
ownership, control or management, and which does not use City streets or other public
property. In any event, system as defined herein shall not be inconsistent with the
definition as set out in the rules of the Board.
6
SECTION 1.
ARTICLE II.
GRANT OF AUTHORITY AND GENERAL PROVISIONS
GRANT OF FRANCHISE AND ACCEPTANCE
City hereby grants to Grantee, to be effective upon certification by Board, a nonexclusive
franchise subject to all of the terms and conditions as herein provided:
A. Grantee shall accept this Franchise in the following manner, and not later than the time
set out in Article XIV, Section 2:
(1) This franchise will be properly executed and acknowledged by Grantee and
delivered to City.
(2) At the same time as delivery of the executed Franchise, Grantee shall deposit with
City its nomefundable acceptance fee in the sum of$14,000.00, for the purpose of
defraying the costs and expenses of developing this Franchise and for the
enforcement and administration costs to be incurred until Franchise fees may be
realized. After the initial payment of the acceptance fee, should costs in excess of
the acceptance fee be incurred by City prior to the payment of the first Franchise
fee, City may charge such excess costs to Grantee and Grantee shall pay them on
demand by City, as an advance on the payment of Franchise fees.
(3) All security deposits, Letters of Credit, certificates of insurance, acceptances,
bonds, attorneys' opinions, organizational and creation documents and guarantees
required of Grantee by this Franchise, shall be delivered with the executed
Franchise and in accordance therewith,
7
SECTION 2.
AUTHORITY GRANTED
A. City grants to Grantee the permission to use streets for erecting, constructing, operating
and maintaining the System, Other rights necessary for the System on other public or
private property must be obtained by Grantee, but City shall have no obligation to give or
grant or assist in obtaining the same.
B. Grantee shall construct and maintain the System so as not to interfere with other uses of
streets. Grantee shall make use of existing poles and other facilities available to Grantee.
C. Notwithstanding the above grant to use streets, no street shall be used by Grantee if City
in its sole opinion determines that such use is inconsistent with the terms, conditions or
provisions by which such street was created or dedicated, or presently used.
SECTION 3.
AGREEMENT
A. Grantee agrees to be bound by all the terms and conditions of this Franchise.
B. The Grantee also agrees to provide all services specifically set forth in, and to comply
with all provisions of, its Offering to provide a System within the boundaries of City.
Further, failure of Grantee to provide a System as described in it Offering, at City's
option, shall be a violation of the provisions of this Franchise. In the event of conflicts or
discrepancies between the Offering of Grantee and the provisions of this Franchise, the
provisions which provide the greatest of this Franchise, the provisions which provide the
greatest benefit to City, in the opinion of the Council, shall prevail.
SECTION 4.
FRANCHISE TERM
This Franchise shall commence upon acceptance by Grantee and shall expire fifteen (15)
years from date of acceptance,
8
SECTION 5.
AREA
This Franchise is granted for City as it exists from time to time during the term of this
Franchise.
SECTION 6.
POLICE POWERS
A. Grantee's rights are subject to the police power of City to adopt and enforce ordinances
necessary to the health, safety and welfare of the public.
B. Any conflict between the provisions of this Franchise and any other present or future
lawful exercise of police powers of City shall be resolved in favor of City.
SECTION 7.
USE OF GRANTEE FACILITIES
City shall have the right to install and maintain, free of charge, upon the poles and within
the underground pipes and conduits of Grantee any wires and fixtures desired by City. Grantee
waives any claim against City arising from City's exercise of these rights,
SECTION 8.
WRITTEN NOTICE
All notices, reports or demands required to be given in writing under this Franchise shall
be deemed to be given when delivered personally to any officer of Grantee or City's
Administrator of this Franchise or 48 hours after it is deposited in the United States Mail in a
sealed envelope, with registered or certified mail postage prepaid thereon, addressed to the party
to which notice is being given, as follows:
If to City:
City of Andover
1685 Crosstown Blvd. N.W.
Andover, Minnesota 55304
Ifto Grantee:
Teleprompter of Quad Cities, Inc,
924 F & M Bank Building
Minneapolis, Minnesota 55402
Attn: System Manager
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With Copy to:
Group W Cable, Inc.
888 Seventh Avenue
New York, New York 10 106
Attn: Vice-President and General Counsel
Such addresses may be changed by either party upon notice to the other party given as provided
in this section.
SECTION 9.
RIGHTS OF INDIVIDUALS
A. No signals, including signals of a Class IV Channel, shall be transmitted from a
subscriber terminal except as required to provide a service authorized by this Franchise
and the subscriber. Grantee and any other person shall neither initiate nor use any
procedure or device for monitoring individual viewing patterns or practices or otherwise
procuring or storing or selling information or data from a subscriber's terminals or
terminal by any other means, without the prior authorization of the affected subscriber
which shall not have been obtained from the subscriber as a condition of service. The
request for such authorization shall be contained in a separate document which
prominently states that the subscriber is authorizing with full knowledge of the
authorization provisions and which identifies the purpose for which the data or
information is being gathered or stored. Such authorization shall be for a limited period
of time not to exceed one year. The authorization shall be revocable at any time by the
subscriber without penalty of any kind whatsoever. A separate authorization shall be
required for each type of classification of data or information sought from a subscriber
terminal.
B. Grantee shall not, without the written authorization of the affected subscriber, provide to
anyone data identifying or designating any subscriber. Any data authorized shall be made
available upon request by and without charge to the authorizing subscriber in
10
understandable fashion, including specification of the purpose for which the information
is being gathered and to whom and for what fee the information is to be sold.
C. Grantee shall not tap or monitor, arrange for the tapping or monitoring, or permit any
other person to tap or monitor, any cable, line, signal input device, or subscriber outlet or
receiver for any purpose whatsoever, without the prior written authorization of the
affected subscriber as required by paragraph A of this section.
D. Nothing herein contained shall prohibit Grantee from verifying System operation and the
transmission of signals to an affected subscriber or from monitoring for the purpose of
billing. The confidentiality of the information obtained in this subsection shall be subject
to the provisions of this section.
SECTION 10.
CERTIFICATE OF CONFIRMATION
Grantee shall abide by the then current rules and regulations of Board regarding the
application, approval, and renewal of a Certificate of Confirmation. Failure of Grantee to obtain
a Certificate of Confirmation or a renewal thereof shall result in automatic termination of this
Franchise, and this Franchise shall cease to be of any force or effect. However, Grantee may
operate the System while the Board is considering an application for renewal of the Certificate of
Confirmation.
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SECTION 1.
ARTICLE III.
DESIGN OF SYSTEM
CHANNEL CAP ACHY - SUBSCRIBER NETWORK
A. The 400 mHz System shall be capable of providing 52 downstream channels, four fully
activated upstream channels and a full-video information retrieval channel. The system
shall provide access to information data bases with the capacity of such data bases to be
250,000 pages.
B. The System shall provide three tiers of subscriber service,
Tier 1 shall be a 25 video channel mini-basic service tier.
Tier 2 shall be a 48 video channel basic service tier.
Tier 3 shall be a 52 video channel interactive service.
SECTION 2. PICTURE QUALITY AND TECHNICAL REQUIREMENTS
A. The System shall produce a picture upon each subscriber's television screen in black and
white or color, depending upon whether color is being telecast and provided the
subscriber's television set is capable of producing a color picture, that is not materially
distorted and free from ghost images, without material degradation of color fidelity. The
System shall produce a sound that is not materially distorted on any receiver of a
subscriber. Grantee, at its expense, shall install and maintain the System so as not to
interfere with any subscriber's ability to receive local broadcast stations.
B. The System shall transmit or distribute signals to all television and radio receivers of all
subscribers without causing unreasonable crossmodulation in the cables or unreasonably
interfering with other electrical or electronic systems or the reception of other television
hor radio receivers.
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C. Grantee shall construct and maintain a System that at least meets minimum technical
standards now or hereafter promulgated by the FCC relating to cable communication
systems; provided, however, that in no event shall the technical standards required to be
met by Grantee be less stringent than the FCC standards in effect at the time of the
adoption of the Ordinance, nor shall Grantee be required to meet minimum FCC technical
standards which apply solely to cable communications systems for which franchises are
granted subsequent to the acceptance of this Franchise. The FCC technical standards
relating to cable communications systems contained in subpart K of part 76 of the FCC
rules are hereby incorporated by reference and made a part hereof,
D. The System shall be designed for and operated on a 24 hours a day continuous operation
basis.
E. Grantee shall initially and subsequently test the technical capacity of the System
according to the procedures delineated in the Offering. Additionally, Grantee agrees to
allow City to select a consultant if City deems it is necessary to review and perform such
testing procedure. The results of any tests required by the FCC shall be filed within ten
days of the conduct of such tests with the City and the Board. Other representatives of
City may be present during testing. Tests may be done annually at such times as is
determined by City, with notice to Grantee. The expenses of any tests required by the
FCC shall be paid by Grantee. The expenses of tests required by City in addition to FCC
required tests shall be paid by City from the Franchise fee. Should the tests show System
to be not in compliance with this Franchise, Grantee shall pay upon demand of City all
expenses associated with City required tests.
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SECTION 3.
TWO- WAY CAPACITY
Grantee shall initially activate and thereafter maintain a two-way capable System (audio,
video and data impulse). Grantee shall fully activate four upstream channels at the time of
System activation. This will include fully interactive service capability supported by
addressable, state-of-the-art equipment.
SECTION 4.
FACILITIES
The Grantee shall construct, maintain and continue to provide all facilities and equipment
set forth in the Offering including, but not limited to, the headend, hubs, distribution system,
studios, equipment and other facilities. Grantee's plan, as set forth in the Offering, for
implementing the construction, utilization, System performance, and maintenance of these
facilities, including its plans for accommodating future growth and changing needs and desires,
shall be fully and timely performed.
SECTION 5.
SPECIAL CHANNEL AND ACCESS REQUIREMENTS
A. Grantee will carry broadcast stations in accordance with FCC rules as from time to time
revised.
B. Channel 10 (the Government access channel) shall be dedicated as an emergency override
channel operated by City.
C. Grantee will provide an audio/video emergency alert override system that will permit the
interruption by designated City officials of all audio (including FM) and video
programming, instructing citizens to switch to Channell 0 for emergency
announcements,
D. Grantee shall provide at least eight (8) channels for access use (including one for each of
the following uses: public, educational, government, leased, regional, religious channel,
14
senior citizens access, and library access). All residential subscribers who receive all or
any part of the total services offered on the System shall also receive all of said eight (8)
access channels at no additional charge. These channels shall be activated upon System
activation and thereafter maintained. Grantee shall establish rules and regulations prior to
System activation for the use of access channels which shall be approved by City before
implementation and thereafter shall not be alerted or amended without approval of City.
In preparing such rules:
(1) Grantee shall provide an equal opportunity for use of access services.
(2) Grantee will consider needs assessments prepared by City,
(3) Grantee will comply, at a minimum, with the requirements of City and the Board
now or hereafter adopted or determined by City or the Board regarding access
channels. Such requirements of the Board are hereby made a part of this
ordinance and include the following:
(a) Grantee shall, to the extent of the System's available channel capacity,
provide to each of its subscribers who receive all or any part of the total
services offered on the System, reception on at least one specially
designated noncommercial public access channel available for use by the
general public on a first come, nondiscriminatory basis; at least one
specially designated access channel for use by local educational
authorities; at least one specially designated access channel for local
government use; and at least one specially designated access channel
available for lease on a first come, nondiscriminatory basis by commercial
and noncommercial users (the preceding hereinafter referred to as the
15
"access channels"), Subscribers receiving only alarm system services or
only data transmission services for computer operated functions shall be
exempt from this requirement. The VHF spectrum shall be used for at
least one of the specially designated noncommercial public access
channels required. No charges shall be made for channel time or playback
of prerecorded programming on at least one of the specially designated
noncommercial public access channels. Any fees for use of public access
channels shall be consistent with the goal of affording the public a low
cost means of television access. Access facilities, equipment and/or
channel time will be made available to the general public, any group or
individual resident in City for the production and/or cablecasting of
noncommercial programming free of charge on a first come,
nondiscriminatory basis.
(b) Whenever any of the access channels is in use during 80 percent ofthe
weekdays (Monday-Friday), for 80 percent of the time during any
consecutive three hour period for six weeks running, and there is demand
for use of an additional channel for the same purpose, Grantee shall then
have six months in which to provide a new specially designated access
channel for the same purpose at no additional cost to subscribers, provided
that provision of such additional channel (s) shall not require the cable
system to install converters.
16
(c) The rules and regulations established by the Grantee and approved by City
governing the access channels shall be filed with the Board within 90 days
after any such channels are put into use.
(d) Subscribers receiving programs on one or more special service channels
without also receiving the regular subscriber services may receive only
one specially designated composite access channel composed of the
programming on access channels. This composite channel shall not
include programming from the leased access channel. Subscribers
receiving only alarm system services or only data transmission services for
computer operated functions shall not be included in this requirement.
(4) The Grantee shall comply, at a minimum, with the requirements of City and
Board, now or hereafter adopted by City or Board regarding public use of its
equipment, including but not limited to the following:
(a) Grantee shall make readily available for public use at least minimal
equipment necessary for the production of programming and playback of
prerecorded programs for the specially designated noncommercial public
access channel. The Grantee shall also make readily available upon need
being shown, the minimum equipment necessary to make it possible to
record programs at remote locations with battery operated portable
equipment.
(b) Need within the meaning of this paragraph shall be determined by
subscriber petition. Said petitions must contain the signatures of at least
17
10 percent of the subscribers of System, but in no case more than 500 nor
fewer than 100 signatures.
SECTION 6.
INSTITUTIONAL NETWORK
The System shall include a separate institutional cable communications network,
interconnected with the subscriber network, which will permit 38 separate television
channels to be sent to each institution and 16 channels to be returned from each
institution to the head-end for redistribution. Said institutional network shall be offered,
activated, expanded, marketed, and developed at a minimum in full compliance with the
Offering. Need for the provision of institutional service shall be determined in the sole
discretion of City.
SECTION 7.
SERVICE TO PUBLIC BUILDINGS AND EDUCATIONAL
INSTITUTIONS
Grantee shall provide, at a minimum, institutional network service to:
Anoka Senior High
Anoka State Hospital
Anoka Vo-Tech Institute
Anoka Fred Moore Junior High
Anoka Sandberg Middle School
Anoka Franklin Elementary School
Anoka Lincoln Elementary School
Anoka Wilson Elementary School
Anoka Washington Elementary School
Anoka St. Stephen's
Anoka City Hall
Anoka Court House
Anoka Fire Station
Anoka City Library
Landscape Career Center (Anoka Vo-Tech)
Anoka Ice Arena
Anoka Senior Citizens Drop In
Anoka Senior Citizens High-rise
Anoka Public Works Department
Anoka Liquor Store
Anoka Liquor Store
Anoka Liquor Store
18
3939 7th Avenue
3300 4th Avenue
West Highway 10
1523 Wash
1902 2nd Avenue
215 West Main
540 South Street
1025 Sunnylane
6 Avenue and School
506 Jackson
2015 1st Avenue North
325 East Main
2301 3rd Avenue
2135 3rd Avenue
2929 7th Avenue
41st Avenue North & 7th Avenue North
Wash & 6th Avenue
2 Bridge Square
2301 3rd Avenue
848 East River Road
709 38th Avenue
809 West Main
Champlin Municipal Center
Champlin Elementary School
Champlin Public Library
Champlin Municipal Liquor Store
Jackson Junior High School
Crooked Lake Community/Elementary School
Meadowcreek Christian School
Andover City Hall
Andover Fire Hall
Ramsey City Hall
Ramsey Elementary School
SECTION 8.
INTERCONNECTION
12001 Highway 52
111 Dean Avenue West
230 Curtis Road
123 Miller Road
109th Street
2939 Bunker Lake Road
2941 Bunker Lake Road
1685 N.W. Crosstown Blvd.
1785 N.W. Crosstown Blvd.
15153 Nowthen Blvd.
15000 Nowthen Blvd.
The System serving the Cities of Andover, Anoka, Champlin, and Ramsey shall be
completely interconnected. Grantee will comply with all present and future rules, regulations
and orders of the Board regarding interconnection of systems, and will cooperate with any
agencies or utilities involved with interconnection. At such times as interconnection is required,
Grantee shall accomplish this without additional charge to subscribers. System shall be initially
constructed so that other systems now or hereafter constructed in any area adjacent to System or
within the metropolitan area (if technologically feasible) may be interconnected with System
upon request to City and agreement with other System's Grantor and Cable Company.
SECTION 9.
NARROWCASTING
System shall be capable of "narrowcasting" of programs to each community separately so
that the residents of one community may view a given program while, at the same time, residents
of another community may watch different programming at the same time on the same channel.
SECTION 10.
REGIONAL CHANNEL
The standard VHF Channel 6 is hereby designated for uniform regional channel usage.
However, until the regional channel becomes operational, Grantee may utilize the standard VHF
19
channel 6 as it deems appropriate. Use oftime on the regional channel shall be made available
without charge.
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ARTICLE IV.
SERVICES AND PROGRAMMING,
SUBSCRIBER CONTRACTS, COMPLAINTS
SECTION 1.
SERVICES AND PROGRAMMING
A. Grantee shall provide those services and programming as specified in its Offering.
B. City recognizes that services and programming in cable communications is rapidly
changing. Therefore, to insure the providing of services and programming in the best
interest of the citizens of City, Grantee may add or delete services and programming
from the System only with the express written permission of City as authorized by the
Council of City, While such addition or deletion of programming or services will not
require the amendment of this Franchise, any addition or deletion of programming will be
subject to all terms and conditions of this Franchise.
C. City authorization of Grantee deletion of programming or services shall not be
unreasonably withheld or delayed, The withholding of authorization of Grantee's
addition of programming or services shall not be unreasonably withheld or delayed and
shall be viewed as an administrative decision of City requiring findings of fact
demonstrating reasonable cause for withholding authorization.
SECTION 2.
INTERRUPTION OF SERVICE AND COMPLAINTS
A. Whenever it is necessary to shut off or interrupt service, Grantee shall do so during
periods of minimum use of the System. Unless such interruption is unforeseen and
immediately necessary, Grantee shall give reasonable notice thereof to subscribers. All
costs incurred in repairing System and handling complaints shall be paid by Grantee, and
if service is interrupted or discontinued for more than 48 hours, subscribers shall be
21
credited pro rata for such interruption. The cause of any such interruption shall be
removed and service restored as promptly as reasonably possible.
B. Grantee shall maintain an office in the Quad City area which shall be open during all
usual business hours, have a listed local telephone, and be so operated that complaints
and requests for repairs or adjustments may be received at any time, 7 days per week.
(1) Notice of this infonnation shall be provided to all new subscribers at time of
subscription and to existing subscribers annually.
(2) Grantee shall not engage in the sale of television sets or provide other television
repair service, but in the event such service is required, shall promptly notify
subscriber of that need for service.
(3) All complaints by City, subscribers, or other persons regarding the quality of
service, equipment malfunction, billing disputes, and any other matters relative to
the System, shall be investigated and responded to by a service representative at
the location of the complaint by Grantee within 24 hours. If reasonably possible,
Grantee shall rectify the cause of all valid complaints. If a complaint is not
rectified within seven days, the complainant may then file the complaint with
City.
(4) City and Grantee shall prepare and maintain a record of all complaints made to
them. If at any time after the filing of a complaint with City, City detennines, in
its sole discretion, that the complaint represents a violation of this Franchise, any
law, ordinance or regulation, or represents a failure in the perfonnance of Grantee
pursuant to this Franchise, City may, in addition to any other remedy available to
it, issue written notice specifying the nature of the complaint and ordering Grantee
22
to appear at the next regularly scheduled Council meeting or at a special meeting
of the Council called for this purpose. At said Council meeting, Grantee shall
explain its failure to rectify the complaint and show cause why the Council should
not institute default proceedings. Failure by Grantee to appear may result, at the
sole discretion of City, in the termination of this Franchise.
23
ARTICLE V.
CONSTRUCTION, INITIAL SERVICE AREA
LINE EXTENSION AND CONSTRUCTION STANDARDS
SECTION 1.
INITIAL SERVICE AREA
Grantee shall construct as the initial service area all areas containing dwelling units
within the cities of Anoka and Champlin, as well as all areas within Andover and Ramsey where
current dwelling unit density exceeds 40 homes per mile. All trunk cables in all four
communities shall be considered part of the initial service area. Grantee shall extend service to
any area contiguous to the initial service area which exceeds a density of 40 homes per street
mile or greater.
SECTION 2.
LINE EXTENSION POLICY
Grantee's extension of service to those areas not included in the initial service area shall
be done pursuant to the following requirements:
A. In the portions of the line extension area which do not reach 40 homes per mile, Grantee
shall provide cable television on a cost-sharing arrangement. If any potential subscriber
requests that the line be extended, Grantee shall calculate the cost on a time and material
basis. Grantee shall assume $400 per home passed by the line extension, Any subscriber
will assume the remainder of all costs incurred on a pro-rata basis. If additional
subscribers receive service from the line extension, they will assume their pro-rated share
of the line extension cost; and, appropriate rebates will be made to subscribers having
previously assumed those costs or if said subscribers cannot be located by Grantee,
appropriate rebates will be made to the current subscriber of affected dwelling unit. If
additional dwelling units are constructed in the line extension and the line extension
density remains under 40 dwelling units per street mile contiguous to the initial service
24
area, Grantee shall rebate to subscribers on the line extension on a prorated basis $400 for
each additional dwelling unit built. In no event will a subscriber who partially assumed
construction costs be rebated more than the amount initially assumed by that subscriber.
B. If the line extension has been built and reaches a density 000 homes per street mile
contiguous to the initial service area, Grantee shall rebate all monies paid by those
subscribers who have assumed line extension costs. In no event will a subscriber who
partially assumed construction costs be rebated more than the amount initially assumed
by that subscriber.
C. For installation of service drops longer than 200 feet, the resident shall be charged an
additional amount for the installation equal to the incremental increase of the cost of time
and material for everything longer than 200 feet.
SECTION 3.
CONSTRUCTION TIMETABLE
A. Within 90 days after the granting of Franchise, Grantee shall apply for all necessary
permits, licenses, certificates and authorizations which are required in the conduct of its
business, including, but not limited to, any joint use attachment agreements, microwave
carrier licenses, or any other permits, licenses and authorizations to be granted by duly
constituted regulatory agencies having jurisdiction over the operation of cable
communication systems, or their associated microwave transmission facilities. If after
one year from the commencement of Franchise term, Grantee has not received the
permits, licenses, certificates and authorizations described in this paragraph, City may
terminate this Franchise without regard to fault for delay in obtaining such permits,
licenses, certificates and authorizations.
25
B. Within 90 days after obtaining all necessary permits, licenses, certificates and
authorizations, Grantee shall give written notice thereof to City and commence
construction and installation of System. Grantee shall construct substantially all areas of
the initial service area which contain dwelling units within one year of the granting of the
state certificate of confirmation so that persons along the route of the energized cable will
have individual "drops" as desired during the same period of time.
C. Any delays in the construction timetable or commencement of construction shall result in
penalties as provided in this Franchise, and continued delays may result in the
termination of this Franchise and all rights and privileges of Grantee hereunder.
(1) Grantee shall promptly notify City of all delays known or anticipated in the
construction of System.
(2) City may extend the time for beginning construction or may extend the
construction timetable in the event Grantee, acting in good faith, experiences
delays by reason of circumstances beyond its control.
SECTION 4.
CONSTRUCTION STANDARDS
A. Grantee shall not open or disturb the surface of any streets or public property without first
obtaining a permit from City for which permit City may impose a reasonable fee to be
paid by Grantee. The lines, conduits, cables and other property placed in the streets and
public property pursuant to such permit shall be located in such part of the street or public
property as shall be determined by City. Grantee shall, upon completion of any work
requiring the opening of any streets or public property, restore the same, including the
pavement and its grounds to as good a condition as formerly and in a manner and quality
approved by City, and shall exercise reasonable care to maintain the same thereafter in
26
good condition. Such work shall be performed with diligence and due care, and if
Grantee shall fail to perform the work promptly, to remove all dirt and rubbish and to put
the street or public property back into the condition required hereby, City shall have the
right to put the streets or public property back into good condition at the expense of
Grantee. Grantee shall, upon demand, pay to City the reasonable cost of such work done
or performed.
B. All wires, conduits, cable and other property and facilities of Grantee shall be so located,
constructed, installed and maintained as not to endanger or unnecessarily interfere with
the usual and customary trade, traffic and travel upon, or other use of, the streets and
public property of City. Grantee shall keep and maintain all of its property in good
condition, order and repair so that the same shall not menace or endanger the life or
property of any person. City shall have the right to inspect and examine at all reasonable
times and upon reasonable notice the property owned or used, in part or in whole, by
Grantee. Grantee shall keep accurate maps and records of all of its wires, conduits,
cables and other property and facilities located, constructed and maintained in the City.
Further, Grantee shall, without charge, furnish copies of such maps and records from time
to time as requested by City.
C. All wire, conduits, cables and other property and facilities of Grantee, shall be
constructed and installed in an orderly and workmanlike manner. All wire, conduits and
cables 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.
27
D. Grantee shall at all times comply with all applicable laws, ordinances, rules, regulations
and codes, federal, state and local. In any event, the installation, operation or
maintenance of System shall not endanger or interfere with the safety of persons or
property in the City.
E. Whenever City shall undertake any public improvement which affects Grantee's
equipment or facilities, City shall, with due regard to reasonable working conditions and
with reasonable notice, direct Grantee to remove its wires, conduits, cables and other
property located in streets or public property. Grantee shall relocate or protect its wires,
conduits, cables and other property at its own expense.
F. Grantee's plans for constructing its System, and the construction of the System, shall be
in accordance with its Offering. However, Grantee shall comply with the following
minimum requirements.
(1) Grantee shall construct underground in any area where all other utility lines are
underground.
(2) Grantee shall change from aerial to underground, at its own expense, in any area
where (i) all other lines are hereafter changed from aerial to underground or (ii)
any aerial line is changed to underground by the open trench method and City
requests Grantee to share the trench.
(3) To enable Grantee reasonable opportunity to change its wiring from aerial to
underground, and also to allow it to prewire all new multiple dwelling units,
subdivisions or new development areas, City shall provide Grantee with written
notice of the following, but in no event shall City have any liability for failure to
provide notice of the following:
28
(a)
(b)
(c)
(d)
SECTION 5.
Any changes of which City has knowledge, or which City may order,
regarding a change from aerial to underground of any line (telephone or
electrical) within its boundaries,
Any underground trenching that may be pending.
All subdividers or developers of new subdivisions and developments shall
be notified of the Franchise and the System.
All Franchise changes affecting the wiring of the System.
CONDITIONS ON USE
A. Grantee shall not place poles or other fixtures where the same will interfere with any gas,
electric or telephone fixture, water hydrant or main, and sewer line.
B. Grantee, at the request of any person holding a building moving permit and with not less
than five days advance notice, shall temporarily remove, raise or lower its wires, conduits
and cables. The expense of such temporary removal, raising or lowering of wires,
conduits and cables shall be paid by person requesting the same, and Grantee shall have
the authority to require such payment in advance.
C. Grantee shall have the authority, to the extent the City has authority to grant the same, to
trim trees upon or overhanging any street or public property so as to prevent the branches
of such trees from coming in contact with the wires, conduits and cables of Grantee. All
trimming for the benefit of Grantee shall be done under the supervision and direction of
City and at the expense of Grantee.
D. Nothing contained in this Franchise shall relieve any person from liability arising out of
the failure or exercise reasonable care to avoid injuring the Grantee's facilities while
29
performing any work connected with grading, regarding or changing the line of any street
or public place or with the construction or reconstruction of any sewer or water system.
30
ARTICLE VI.
SYSTEM OPERATIONS
SECTION 1. INFORMATION AVAILABILITY
A. Throughout the term of this Franchise, Grantee shall maintain books and records in
accordance with normal and accepted bookkeeping and accounting practices for the cable
communications industry, and allow for inspection and copying of them by City at
reasonable times at its designated office, The books and records to be maintained by
Grantee shall include the following:
(I) A record of all requests for service except those requests subsequently withdrawn
(retained for two years);
(2) A record of all subscriber or other complaints, and the action taken (retained for
two years);
(3) A file of all subscriber contracts;
(4) Grantee policies, procedures and company rules; and
(5) Financial records.
B. City shall give Grantee at least 24 hours notice before making inspections of any books or
records of Grantee.
C. Grantee shall file with City, at the time of its annual payment of the franchise fee, as
described in this Franchise, the following (although City may make written waiver of
receipt of any of the following):
(1 ) A financial statement certified by an officer of Grantee showing, in such
reasonable detail as acceptable to City, the gross revenues of Grantee for the
preceding fiscal year.
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(2) Current list of names and addresses of each officer and director and other
management personnel, and if a corporation, each shareholder having stock
ownership of three (3 %) percent or more, and if a partnership, all general partners,
and if a general partner is a corporation, the foregoing information shall be given
as to the corporate general partner.
(3) A copy of each document filed with all federal, state and local agencies not
previously filed with City with respect to the ownership and operation of System
(each of these filings shall be provided at the time the filing is made).
(4) A statement of its current billing practices
(5) A current copy of its rules and policies.
(6) A current copy of its subscriber service contract, if any.
D. City, its agents and representatives shall have authority to arrange for and conduct an
audit of an copy the books and records of Grantee, The City and Grantee shall establish
reasonable procedures to protect the confidentiality of information. Grantee shall first be
given five days notice of the audit request, the description of and purpose for the audit,
and description, to the best of City's ability, of the books, records and documents it wants
to review.
SECTION 2.
SERVICE CONTRACT
A. Grantee shall receive approval from City of the form and content of the service contract
to be used by Grantee prior to entering into any such service contracts with subscribers,
and the Grantee shall make no changes in the approved service contract without prior
written approval of City, which permission shall not be unreasonably withheld or
delayed. The service contract shall include, at a minimum, a schedule of all applicable
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rates and charges, description of services, instructions on the use of the system, billing
and collection practices.
B. The service contract shall further contain a statement as follows:
Grantee shall not, as to rates, charges, service facilities, rules, regulations or in
any other respect, make or grant any preference or advantage to any person, nor
subject any person to any prejudice or disadvantage, provided, however, that
nothing in this Franchise shall be deemed to prohibit the establishment of special
contracts or reduced rates for senior citizens or handicapped heads of households
or for installation rate reductions for 90 days after cable service is first offered in
an area or for such other purposes offered to all individuals similarly situated or to
meet competition from other providers of telecommunications services.
C. Grantee shall have authority to promulgate such rules, regulations, terms and conditions
governing the conduct of its business as shall be reasonably necessary to enable Grantee
to exercise its rights and perform its obligations under this Franchise and to assure an
uninterrupted service to each and all of its subscribers; provided, however, that such
rules, regulations, terms and conditions shall not be in conflict with the provisions of the
Franchise, ordinances of City, and laws of the State of Minnesota or the United States.
D. Each subscriber shall be provided with instructions on filing complaints or otherwise
obtaining information or assistance from Grantee.
E. All items described in this section shall be provided to each new subscriber at the time a
contract is entered into or service begun, and to all existing subscribers not less than once
each year.
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F. The term of a subscriber contract shall not be for more than 12 months duration unless
after 12 months the contract may be terminated by the subscriber at his option at any
time, with no penalty to subscriber.
SECTION 3.
SUBSCRIBER PRACTICES
A. There shall be no charge for disconnection of any installation or outlet. If any subscriber
fails to pay a properly due monthly subscriber fee, or any other properly due fee or
charge, Grantee may disconnect the subscriber's service outlet, provided, however, that
such disconnection shall not be effected until after the later of (i) 45 days after the due
date of said delinquent fee or charge or (ii) ten days after delivery to subscriber of written
notice of the intent to disconnect. If a subscriber pays before expiration of the later of (i)
or (ii), Grantee shall not disconnect. After disconnection, upon payment in full of the
delinquent fee or charge and the payment of a reconnection charge, Grantee shall
promptly reinstate the subscriber's cable service.
B. Refunds to subscribers shall be made or determined in the following manner:
(1) If Grantee fails, upon request by a subscriber, to provide any service then being
offered, Grantee shall within 60 days of subscriber request refund all deposits or
advance charges paid for the service in question by said subscriber. This
provision does not alter Grantee's responsibility to subscribers under any separate
contractual agreement or relieve Grantee of any other liability.
(2) If any subscriber terminates any monthly service because of failure of Grantee to
render the service in accordance with Franchise, Grantee shall refund to such
subscriber the proportionate share of the charges paid by the subscriber for the
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services not received. This provision does not relieve Grantee of liability
established in other provisions ofthis Franchise.
C. If any subscriber terminates any monthly service prior to the end of a prepaid period, a
proportionate amount of any prepaid subscriber service fee, using the number of days as a
basis, shall be refunded to the subscriber by Grantee.
D. Continued failure by Grantee to provide services required by this Franchise may, in the
discretion of City, be cause for imposition of a penalty or termination of this Franchise.
SECTION 4.
FRANCHISE FEE. RATES. CHARGES. CHANGES IN FEES AND
PROCEDURES
A. Rate Change Procedure.
(1) To the extent permitted by law, all increases in subscriber rates and charges shall
be charged by Grantee, in a manner provided for herein. Grantee, as a condition
precedent to its acceptance of this Franchise hereby knowingly and voluntarily
consents to these procedures for the term of this Franchise of all rates and charges.
(2) City hereby reserves the right to approve or adopt regulations governing Grantee's
collection of advance charges and deposits, installation and reconnection charges,
policies and procedures, disconnection charges, policies and procedures, and the
availability of refunds. Approval of City shall not be unreasonably withheld or
delayed.
(3) Cost for installing any part ofthe System will be a factor in the rate only if such
cost was incurred within City.
(4) The territory for rates applicable to System shall be City and all Cities then parties
to a joint powers agreement relating to the System.
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B. Franchise Fee.
(1) Throughout the term of this Franchise, Grantee shall pay to City, within 60 days
after the end of each fiscal year of Grantee, an annual fee of five percent (5%) of
all gross revenues. Quarterly payments of Franchise fees will be made within
ninety (90) days after end of each quarter with adjustments at year end for actual
Gross Revenues (59C, 12/17/85). The rates provided in the franchise shall be
guaranteed for 2 years and 6 months after commencement of cable service to the
residential subscribers on October 20,1983. Basic rates shall be regulated
pursuant to the terms and conditions of the franchise allowing changes in rate
unless the City specifically disapproves regulated pursuant to the terms and
conditions of the franchise. This section further details the procedures for the
regulation of other than basic service rates in the event the law should provide for
their regulation (59B, 11/20/84). No payment will be allowed of any fee that is
different from five percent, other than the filing fee and payment required of the
successful applicant as established by City to recover the costs of franchising.
Grantee agrees to support any waiver required by the FCC for the established
franchise fee. The annual fee may be subject to renegotiation at such time as
federal or state authorities no longer regulate the amount of the fee. If Grantee
and City do not agree in renegotiations, the Franchise fee shall remain unchanged.
(2) Payment will be made to City with an itemization of the gross revenues derived
from the services in City.
C. Rates and Other Charges.
(1) Rates and charges charged by Grantee for monthly service and installation and
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other charges hereunder shall be uniform, fair and reasonable and designed to
meet all necessary costs of service, including a fair rate of return on the original
cost, less depreciation, of the properties devoted to such service (without regard to
any subsequent sale or transfer price or cost of such properties).
(2) For three years after commencement of cable service to residential subscribers,
the maximum rates shall be the specific rates of Grantee as included in Exhibit A,
attached hereto and made a part of this Franchise and known as Grantee Schedule
of Rates.
(3) Service requests for maintenance or repair of Grantee's property shall be
performed at no charge to a subscriber. If such maintenance or repair is required
as a result of damage caused by subscriber, Grantee may charge to the subscriber
as a maximum its direct costs for material and labor for service calls to
subscriber's home.
(4) Rates for new or additional services not initially included in Offering of Grantee
and therefore not listed in Exhibit A shall be established by resolution of Council
of City according to the terms of this Franchise.
D. Rate Changes.
(1) No rate change shall be approved that would result in different rates or charges for
service to similarly situated subscribers in the rate territory, other than those
specified in Article VI, Section 2.B.
(2) The standards for reviewing a proposed rate change will include at least the
following:
(a) The ability of the Grantee to render System services and to derive a
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reasonable profit therefrom under the existing rate schedule and proposed
rate schedule;
(b) All revenues and profits or actual losses derived from System;
(c) Tax benefits and tax costs received by Grantee, its partners or
shareholders, as the result of their investment in the System;
(d) Cash flow generated by System;
(e) The efficiency of Grantee;
(f) The quality of the service offered by Grantee;
(g) The original cost of the System, less depreciation;
(h) A fair rate of return with respect to investments having similar risks to that
of providing cable communication services;
(i) The extent to which Grantee has adhered to the terms of this Franchise;
G) Fairness to residents and subscribers;
(k) Capital expenditures (actual and, if the situation so warrants, projected) by
Grantee in providing updated technology and service to subscribers;
(1) The extent to which Grantee has then provided service to schools,
hospitals, libraries, publicly owned or leased building and similar
institutions within City;
(m) The extent to which Grantee has technologically upgraded the System; and
(n) Increased or decreased expenses incurred by Grantee in the purchase of
services; and
(0) Such other factors as City or Grantee may deem relevant.
(3) The procedures to be followed in changing a Basic rate or charge shall include at
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least the following:
(a) Grantee shall give City written notice of any proposed rate increase at least
ninety (90) days prior to the proposed effective date of the rate increase.
(b) The application shall be supported by statistical and other proof indicating
that the existing rate or charge is inadequate and unreasonable and that the
proposed increases are required to enable Grantee to render service to
fulfill its obligations under this Franchise and to derive a reasonable profit
therefrom.
(c) The notice shall include current financial and other information with at
least the following:
1. Balance Sheet;
2. Income Statement;
3. Statement of sources and application of funds;
4. Detailed supporting schedules of expenses, income, assets and
other items as may be required by City;
5. Statement of current and projected subscribers;
6. A current list of rates and charges of Grantee applicable to systems
owned or operated by its parent corporation or other subsidiaries or
affiliates of its parent corporation at other locations;
7. A current list of rates and charges for other systems in the seven
county Metropolitan area;
8. Cash flow derived from System services since the commencement
of this Franchise; and
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9. Statement of tax benefits received by Grantee, its partners or
shareholders, as a result of their investment in System.
(d) In the event the proposed rate increase exceeds (in any respect) the
projected rate increases shown on Exhibit B, City shall notify Grantee and
Board and shall schedule a public hearing on the proposed rate increase
within two weeks from the date of receipt of the notice. Grantee will
notify the public through providing notice for one week, each day between
7:00p.m. and 9:00 p.m. on two lowest tier channels of the date, place and
time of the hearing. City will publish notice ten days prior to hearing in its
official newspaper.
(e) After closing the public hearing, City will have 31 days within which to
make its determination; however, any proposed change in rates or charges
shall become effective upon the date specified in the notice of Grantee.
Approval of City shall not be unreasonably withheld.
(f) If City fails to approve the change of rates or charges within the 31 day
period, the rate shall still become effective upon the date specified in the
notice of Grantee.
(g) City may utilize a rate consultant to advise it on proposed rate changes and
to assist it in maintaining uniform rates within the rate territory. A rate
consultant may be any person who has sufficient background and
experience, in the sole opinion of City, to properly evaluate and analyze
rates and charges.
(h) All costs for the review of a notice for a rate or charge change shall be
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paid by City from the Franchise fee.
(i) Any time limit may be waived only if City and Grantee consent.
G) If City fails to approve the change of rates, either City or Grantee may
initiate binding arbitration pursuant to Minnesota Statutes except as
delineated below.
(k) The parties shall, within 15 days of City's failure to approve the rate
increase, appoint one arbitrator each who is experienced and
knowledgeable in the evaluation and analysis of cable rate and charge
changes. Arbitrators shall each agree upon the selection of a third
arbitrator, similarly qualified, within 15 days after appointment of the
second arbitrator.
(1) Within 15 days after appointment of all arbitrators and upon ten days
written notice to parties, the arbitrators shall commence a hearing on the
rate change proposed by Grantee.
(m) The hearing shall be recorded and may be transcribed at the request and
expense of either party. All hearing proceedings, debates and
deliberations shall be open to the public, City, and Grantee and at such
times and places as contained in the notice or as thereafter publicly stated
in the order to adjourn.
(n) The arbitration panel shall be required to approve, reject or modify the rate
change proposed by Grantee according to the standards established in this
Franchise.
(0) At the close of the hearings and within 30 days, the arbitrators shall
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prepare written findings and make a written decision agreed upon by a
majority of the arbitrators which shall be served by mail upon City and
Grantee.
(P) The decision of a majority of the arbitrators shall be binding upon both
parties, provided that either party may pursue any judicial remedies
otherwise available to either party.
( q) Should the rate change be rej ected or modified by a maj ority of the
arbitrators, the Grantee shall within ninety (90) days and pursuant to
procedures established by Grantee refund the rate overage to affected
subscribers.
(r) Either party may also seek judicial relief to the extent authorized under
Minnesota Statutes, ~572.09 and ~572.19 as the same may be amended,
and in addition, under the following circumstances:
(i) A party fails to select an arbitrator;
(ii) The arbitrators fail to select a third arbitrator;
(iii) One or more arbitrator is unqualified;
(iv) Designated time limits have been exceeded;
(v) The arbitrators have not proceeded expeditiously; or
(vi) Based upon the record the arbitrators abused their discretion.
(s) In the event a Court of competent jurisdiction determines the arbitrators
have abused their discretion, or that the regulation of a given rate is
beyond the authority of City, it may order the arbitration procedure
repeated and issue findings, orders and directions, with costs of suit to be
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awarded to the prevailing party.
(t) Cost of arbitration shall be borne equally.
(4) The procedures to be followed in changing any rate or charge other than basic
shall include the following:
( a) Grantee shall give City written notice of any rate increase at least ninety
(90) days prior to the effective date of the rate increase.
(b) In the event the percentage of the rate increase (in any respect) does not
exceed the percentage of the increase from the CPI in existence on the
date of the certification of this Franchise by the Board or specified in the
last rate increase notice of the Grantee (whichever event is most recent),
the noticed rate shall become effective upon its noticed effective date.
(c) Except as provided in Article VI, Section 4., D.(c) (5), in the event the
percentage of the rate increase (in any respect) exceeds the percentage of
increase from the CPI in existence on the date of the certification of this
Franchise by the Board or specified in the last rate increase notice of the
Grantee (whichever event is most recent), the notice rate shall become
effective upon its noticed effective date but the notice shall also include
current financials and other information as specified in Article VI, Section
4., D. (4) (c) (1.-9.).
(i) Upon review by City of the information provided in the notice by
Grantee, City may schedule a public hearing on the proposed rate
increase within two (2) weeks from the date of receipt of the
notice. Grantee will notify the public as specified in Article VI,
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Section 2., D. (4) (d). The City will publish notice ten (10) days
prior to the hearing in its official newspaper.
(ii) After closing the public hearing, City will have thirty-one (31)
days within which to make any determination regarding the noticed
rate increase; however, any proposed change in rates or charges
shall become effective upon the date specified in the notice of
Grantee regardless of the determination of City.
(iii) The City may utilize a rate consultant to advise it on proposed rate
changes and to assist it in maintaining uniform rates within the
territory. A rate consultant may be any person who has sufficient
background and experience, in the sole opinion of City, to properly
evaluate and analyze rates and charges.
(iv) All costs for the review of a notice for rate or charge change should
be paid by City from the Franchise fee.
(5) In the event the law should provide for the regulation of other than basic rates by
City, the procedure for the change of other than basic rates shall be as outlined
above, except that subsequent to the public hearing, should the City fail to
approve the change of rates, either City or Grantee may initiate binding arbitration
pursuant to Minnesota statutes except as delineated in Article VI, Section 3., D.
(k) - (t).
E. Periodic Reviews, Renegotiation and Technological Update of System.
The field of cable communications is a relatively new and rapidly changing one
which shall no doubt see many regulatory, technical, financial, marketing and legal
44
changes during the term of the Franchise. Therefore, in order to provide for a maximum
degree of flexibility in this Franchise, and to help achieve a continued advanced and
modern system, the following renegotiation provisions will apply:
(1) City reserves the right to adopt rules and regulations controlling the procedures
and subjects for periodic reviews and renegotiation. In the absence of any City
action taken to exercise these rights, Grantee shall be subject to at least the
procedures and subjects described in this section.
(2) City may require, in its sole discretion, System performance evaluation sessions at
any time during the term of this Franchise or as required by federal or state law.
In addition to these discretionary evaluation sessions, regular evaluation sessions
shall be conducted by City within 30 days ofthe third, fifth and eighth
anniversary dates of the date of acceptance of this Franchise by Grantee.
(3) All evaluation sessions shall be open to the public and notice of sessions
published in the same way as a legal notice. Grantee shall notify its subscribers of
all evaluation sessions by announcement on at least two channels of the System
between the hours of7:00 p.m. and 9:00 p.m. for five consecutive days preceding
each session.
(4) Topics which may be discussed at any evaluation session may include, but not be
limited to, service rate structures; franchise fee; penalties; free or discounted
services; application of new technologies; system performance; services provided;
programming offered; community access; local origination; customer complaints;
privacy; amendments to this Franchise; judicial, Board and FCC rulings; line
extension policies; and Grantee or City Rules.
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(5) During a review and evaluation by City, Grantee shall fully cooperate with City
and shall provide without cost such information and documents as City may
request to reasonably perform the service.
(6) If at any time during its review, City determines that reasonable evidence exists of
inadequate System performance, it may require Grantee to perform tests and
analyses directed toward such suspected inadequacies at the Grantee's own
expense. Grantee shall fully cooperate with City in performing such testing and
shall prepare results and a report, if requested, within 30 days after notice. The
report prepared by Grantee shall include at least:
(a) A description of the problem in System performance which precipitated
the special tests.
(b) What System component was tested.
(c) The equipment used and procedures employed in testing.
(d) The method, if any, by which such System performance problem was
resolved.
(e) Any other information pertinent to said tests and analyses which may be
required by City, or determined when the test is performed.
City may require that tests be supervised at Grantee's expense by a consultant
designated by City. The consultant shall sign all records of special tests and
forward to City such records with a report interpreting the results of the tests and
recommending actions to be taken.
(7) Grantee shall exercise its best efforts to maintain a modem state-of-the-art System
which is comparable to other operating CATV systems similarly situated. As a
46
result of the periodic review sessions, City may request Grantee to modify or to
upgrade the System, or to provide additional services, and authorize rate increases
sufficient to insure the economic feasibility of these changes. Grantee shall
implement such changes unless: (a) technology does not permit the suggested
changes; (b) the proposed changes and rate increases taken in combination are
not economically feasible; or (c) insufficient time has been allowed for
implementation. In the event of a disagreement between City and Grantee with
respect to the items above, City may retain a cable consultant to advise and assist
both parties in continued negotiations with respect to the changes which City
desires. Either party may initiate binding arbitration pursuant to Minnesota
Statutes and Article XI, section 2B of this Franchise. Costs of arbitration shall be
shared equally by Grantee and City.
SECTION 5.
FRANCHISE RENEWAL
A. Grantee may apply for renewal of this Franchise at any time prior to the expiration of this
Franchise on forms provided by City. In any event renegotiation shall commence at least
12 months before the expiration of the Franchise term, unless the City determines not to
reissue the Franchise to Grantee or desires to consider additional applicants for a
franchise.
B. Grantee may be approved, and this Franchise or modification to it may be renewed, by
City in accordance with the then existing rules of the FCC, the Board, the City and all
other applicable laws, ordinances, rules or regulations.
C. Nothing in this Franchise shall be construed to require renewal of this Franchise.
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D. City shall conduct an investigation and evaluation of the Grantee and the System and the
renewal proposal. This investigation and evaluation shall be completed by City within
six months after receipt of the application and determination by City of its completeness.
E. Renewal of this Franchise may be for any length of time by not more than fifteen years,
unless otherwise permitted by federal or state law, and may be on a year to year basis in
the sole discretion of City.
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ARTICLE VIII.
INDEMNIFICATION, INSURANCE, LETTER OF
CREDIT AND BOND
SECTION 1.
GENERAL
A. All rights of City pursuant to indemnification, insurance letter of credit or bond, as
provided for by this Franchise, are in addition to all other rights the City may have under
this Franchise or any other ordinance, rule, regulation or law.
B. The exercise or failure to exercise by City of any rights pursuant to any section of this
Franchise shall not affect in any way the right of City to subsequently exercise any such
rights or any other right of City under this Franchise or any other ordinance, rule,
regulation or law.
SECTION 2.
INDEMNIFICATION AND INSURANCE
A. Grantee shall fully indemnify, defend and hold harmless, City, its officers, boards,
commissions, elected officials, agents and employees against any and all costs, damage,
expense, claims, suits, actions, liability and judgments for damages, including but not
limited to, expenses for legal fees, whether suit be brought or not, and disbursements and
liabilities incurred by City related to this Franchise or the System in connection with:
(1) Damage to persons or property, in any way arising out of or through the acts or
omissions of Grantee, their respective servants, officials, agents, or employees or
to which Grantee's negligence or that of their respective servants, agents, officials
or employees 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,
50
firm or corporation, except claims because of City's own programming; and
(3) Arising out of Grantee's failure to comply with the provisions of this Franchise,
any federal, state or local law, ordinance or regulation applicable to Grantee or the
System.
(4) Any and all claims which Grantee may now or hereafter have or claim to have
against City, its servants, agents, employees or officials, due to or arising out of
damage to any of Grantee's property or equipment, including, without limitation,
resulting or consequential loss of income, injury to reputation, or any other
resulting or consequential damages of any kind, caused by or resulting from acts
or omissions of City or any of its servants, agents employees or officials.
B. If suit be brought or threatened against City, either independently or jointly with Grantee,
or with any person or municipality, Grantee, upon notice given by City, shall defend City
at the cost of Grantee, and if final judgment is obtained against City, either independently
or jointly with Grantee, or any other defendants, Grantee shall indemnify City and pay
such judgment with all costs and satisfy and discharge the same.
C. City reserves the right to cooperate with Grantee and participate in the defense of any
litigation either through intervention or otherwise. Grantee shall pay upon receipt of
written demand from City, all expenses incurred by City in defending itself with regard to
any matters in this section. These expenses shall include, but not be limited to, attorneys'
fees, and the reasonable value of services (as determined by City) rendered by City or any
employees, agents or representatives of City.
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SECTION 3. INSURANCE
A. Grantee shall maintain liability insurance covering its obligations of indemnification
provided for in or as a result of the exercise of this Franchise covering both the City and
Grantee and shall maintain said insurance during the entire term of this Franchise in the
minimum amount of:
(1) $500,000 for property damage to anyone person;
(2) $2,000,000 for property damage in anyone act or occurrence;
(3) $1,000,000 for personal injury to anyone person; and
(4) $2,000,000 for personal injury in anyone act or occurrence.
B. Such insurance shall be with a company acceptable to City and shall otherwise be in form
and substance acceptable to City. Such insurance policy with written evidence of
payment of required premiums shall be filed and maintained with City during the term of
the Franchise. The above minimum amounts shall be changed from time to time by
Grantee as requested by City. Grantee shall immediately give notice to City of any
threatened or pending litigation affecting this insurance.
C. Neither the provisions of this section nor any damages recovered by City or any
individual shall be construed to, or shall limit the liability of Grantee.
D. No recovery by City of any sum by reason of the Letter of Credit or Bond required in this
Franchise shall be any limitation upon the liability of Grantee to City under the terms of
this section, except that the sum so received by City from such Letter of Credit or Bond
shall be deducted from a recovery by City under this section, if for the same act or
occurrence.
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E. All insurance policies maintained pursuant to this Franchise shall contain the following
endorsement:
It is hereby understood and agreed that this insurance policy may not be canceled
nor the intention not to renew be stated until 60 days after receipt by City, by
registered mail, of written notice of such intention to cancel or not to renew.
SECTION 4.
LETTER OF CREDIT
A. At the time of acceptance of this Franchise, Grantee shall deliver to City an irrevocable
an unconditional Letter of Credit, in form and substance acceptable to City, from a
National or State bank approved by City, in the amount of $10,000.
B. The Letter of Credit shall provide that funds will be paid to City, upon written demand of
City, and in an amount solely determined by City in payment for penalties charged
pursuant to this section, in payment for any monies owed by Grantee pursuant to its
obligations under this Franchise, or in payment for any damage incurred as a result of any
acts or omissions by Grantee pursuant to this Franchise.
C. In addition to recovery of any monies owed by Grantee to City or damages to City as a
result of any acts or omissions by Grantee pursuant to the Franchise, City in its sole
discretion may charge to and collect from the Letter of Credit the following penalties:
(1) For failure to complete System construction in accordance with Grantee's initial
service area plan, unless City approved the delay, the penalty shall be Five
Hundred Dollars ($500.00) per day for each day, or part thereof, such failure
occurs or continues.
(2) For failure to provide data, documents, reports or information or to cooperate with
City during an application process or System review, the penalty shall be One
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Hundred Dollars ($100.00) per day for each day, or part thereof, such failure
occurs or continues.
(3) For failure to comply with any ofthe provision of this Franchise for which a
penalty is not otherwise specifically provided pursuant to this Paragraph C, the
penalty shall be One Hundred Dollars ($100.00) per day for each day, or part
thereof, such failure occurs or continues.
(4) For failure to test, analyze and report on the performance of the System following
a request by City, the penalty shall be One Hundred Dollars ($100.00) per day for
each day, or part thereof, such failure occurs or continues.
(5) For failure by Grantee to modify the System or to provide additional services
within 45 days after required by binding arbitration the penalty shall be Five
Hundred Dollars ($500.00) per day for each day, or part thereof, such failure
occurs or continues.
(6) Forty-five days following notice from City of a failure of Grantee to comply with
construction, operation or maintenance standards, the penalty shall be Five
Hundred Dollars ($500.00) per day for each day, or part thereof, such failure
occurs or continues.
(7) For failure to provide the services Grantee has proposed, including but not limited
to the implementation and the utilization of the access channels and the making
available for use of the equipment and other facilities to City, the penalty shall be
Five Hundred Dollars ($500.00) per day for each day, or part thereof, such failure
occurs or continues.
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(8) Each violation of any provision of this Franchise shall be considered a separate
violation for which a separate penalty can be imposed.
D. Exclusive ofthe contractual penalties set out above in this section, a violation of any
provision of this Franchise is a misdemeanor.
E. Whenever City finds that Grantee has violated one or more terms, conditions or
provisions of this Franchise, a written notice shall be given to Grantee informing it of
such violation. At any time after fifteen days following local receipt of notice, provided
Grantee remains in violation of one or more terms, conditions or provisions of this
Franchise, in the sole opinion of City, City may draw from the Letter of Credit all
penalties and other monies due City.
F. Whenever a penalty has been assessed, Grantee may, within thirty days oflocal receipt of
notice, notify City that there is a dispute as to whether a violation or failure has, in fact,
occurred. Such notice by Grantee to City shall specify with particularity the matters
disputed by Grantee.
(1) City shall hear Grantee's dispute at the next regularly scheduled Council meeting.
City shall supplement the Council decision with written findings of fact.
(2) Upon a determination by City that no violation has taken place, City shall refund
to Grantee without interest all monies drawn from the Letter of Credit by reason
of the alleged violation.
G. If said Letter of Credit or any subsequent Letter of Credit delivered pursuant hereto
expires prior to 15 months after the expiration of the term of this Franchise, it shall be
renewed or replaced during the term of this Franchise to provide that it will not expire
earlier than 15 months after the expiration of this Franchise. The renewed or replaced
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Letter of Credit shall be on the same form and with a bank authorized herein and for the
full amount stated in paragraph A of this section. Failure to renew or replace the Letter of
Credit shall be grounds for termination of this Franchise.
H. If City draws upon the Letter of Credit, or any subsequent Letter of Credit delivered
pursuant hereto, in whole or in part, Grantee shall replace the same within fifteen days
and shall deliver to City a like replacement Letter of Credit for the full amount stated in
paragraph A of this section as a substitution of the previous Letter of Credit.
I. If any Letter of Credit is not so replaced, City may draw on said Letter of Credit for the
whole amount thereof and hold the proceeds, without interest, and use the proceeds to pay
costs incurred by City in performing and paying for any or all of the obligations, duties
and responsibilities of Grantee under this Franchise that are not performed or paid for by
Grantee pursuant hereto, including attorney's fees incurred by the City in so performing
and paying. The failure to replace any Letter of Credit may also, at the option of City, be
deemed a default by Grantee under this Franchise. The drawing on the Letter of Credit
by City, and use of the money so obtained for payment or performance of the obligations,
duties and responsibilities of Grantee which are in default, shall not be a waiver or release
of such default.
J. The collection by City of any damages, monies or penalties from the Letter of Credit
shall not affect any other right or remedy available to City, nor shall any act, or failure to
act, by City pursuant to the Letter of Credit, be deemed a waiver of any right of City
pursuant to this Franchise or otherwise.
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SECTION 5. BONDS
A. At the commencement of this Franchise, and at all times thereafter until Grantee has
liquidated all of its obligations with City, Grantee shall maintain with City a bond in the
total sum of One Hundred Thousand Dollars ($100,000.00) in such form and with such
sureties as shall be acceptable to City, conditioned upon the faithful performance of
Grantee of this Franchise and the acceptance hereof given by Grantee and upon the
further condition that in the event Grantee shall fail to comply with any law, ordinance or
regulation, there shall be recoverable jointly and severally from the principal and surety
of the bond, any damages or losses suffered by City as a result, including the full amount
of any compensation, indemnification or cost of removal of any property of Grantee,
including a reasonable allowance for attorneys' fees and costs (with interest at two (2%)
percent in excess of the then prime rate), up to the full amount of the bond, and which
bond shall further guarantee payment by Grantee of all claims and liens against City or
any public property, and taxes due to City, which arise by reason of the construction,
operation, maintenance or use of the System.
B. The rights reserved by City with respect to the bond are in addition to all other rights the
City may have under this Franchise or any other law.
C. City may, in its sole discretion, reduce the amount ofthe bond.
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ARTICLE IX.
DEFAULT
SECTION 1. NOTICE AND DEFAULT
A. City shall give written notice of default to Grantee if City, in its sole discretion,
determines that Grantee has:
(1) Violated any material provision of this Franchise or the acceptance hereof, or any
rule, order, regulation or determination of the City, state or federal government,
not in conflict with this Franchise;
(2) Attempted to evade any provision of this Franchise or the acceptance hereof;
(3) Practiced any fraud or deceit upon City or subscribers;
(4) Made a material misrepresentation of fact in the application for or negotiation of
the Franchise; or
(5) Incurred a 6 month or more delay in the construction schedule.
B. If Grantee fails to cure such default within 30 days after the giving of such notice (or if
such default is of such a character as to require more than 30 days within which to cure
the same, and Grantee fails to commence to cure the same within said 30 days period and
thereafter fails to use reasonable diligence, in City's sole opinion, to cure such default as
soon as possible), then and in any event, such default shall be a substantial breach and
City, at its option may elect to either cure the default or terminate and cancel this
Franchise and all rights and privileges of this Franchise as follows:
(1) City may cure any default and all sums expended by City, including attorneys'
fees incurred in curing such default, whether suit be brought or not, with interest
thereon at a rate per annum of two (2%) percent in excess of the then prime rate,
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shall be paid by Grantee to City, upon demand, and failure to so pay upon demand
likewise may be deemed by City to be a default under this Franchise.
(2) City may place the issue of revocation and termination of the Franchise before the
Council at a regular meeting of the City Council. If City decides there is cause or
reason to terminate, the following procedure shall be followed:
(a) City shall provide Grantee with a written notice of City's intention to
terminate the Franchise and the reason or cause for proposed termination.
City shall allow Grantee a minimum of 30 days subsequent to receipt of
the notice in which to correct the default.
(b) Grantee shall be provided with an opportunity to be heard at a public
hearing prior to any decision to terminate this Franchise.
(c) In the event that City determines to terminate this Franchise, the Grantee
shall have a period of 30 days, beginning the day next following written
notice to Grantee of such decision, within which to file an appeal with the
Board, pursuant to the then applicable statues and procedures of the Board.
Any such appeal to the Board shall be a contested case to which the Board
shall not be a party. During such 30 day period and until the Board
determines the appeal, if an appeal is taken, the Franchise shall remain in
full force and effect, unless the term thereof sooner expires.
(d) If Board approves of the action of City, the Franchise shall terminate
immediately. If Board disapproves of the action of City, the Franchise
shall remain in full force and effect for the full term hereof unless sooner
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SECTION 2.
terminated in accordance with the provision hereof, or applicable law or
rules of Board.
CROSS DEFAULT
A. If Grantee should be in default under any of the terms or provisions of a franchise, or
acceptance thereof, of another city (then a party to a Joint Powers Agreement relating to
the System), at City's option, to be exercised by notice to Grantee given at any time while
such default exists, such default may be deemed by City a default by Grantee under this
Franchise.
B. This section, or any other section or provision of this Franchise, shall not be deemed to
incorporate into this Franchise by reference any other franchises.
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SECTION 1
ARTICLE X.
FORECLOSURE, RECEIVERSHIP AND ABANDONMENT
FORECLOSURE
Upon the foreclosure or other judicial sale of all or a part of the System, Grantee shall
notify City of such fact and such notification shall be treated as a notification that a change in
control of Grantee has taken place, and the provisions of this Franchise governing the consent to
transfer or change in ownership shall apply without regard to how such transfer or change in
ownership occurred.
SECTION 2.
RECEIVERSHIP
City shall have the right to cancel this Franchise 120 days after the appointment of a
receiver or trustee to take over and conduct the business of Grantee, whether in receivership,
reorganization, bankruptcy or other action or proceeding, unless such receivership or trusteeship
shall have been vacated prior to the expiration of said 120 days, or unless:
(a) Within 120 days after his election or appointment, such receiver or trustee shall
have fully complied with all the provisions of this Franchise and remedied all
defaults hereunder; and
(b) Such receiver or trustee, within said 120 days, shall have executed and agreement
with City 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 Franchise.
SECTION 3.
ABANDONMENT
Grantee may not abandon any portion of System without having given not less than three
months prior notice to City and Board. Further, Grantee may not abandon any portion of System
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without compensating City for damages resulting from the abandonment. The amount of
damages resulting from abandonment and due City shall be determined in the sole discretion of
City. An abandonment of any portion of the System as determined in the sole discretion of City
shall be a cause for termination of this Franchise by City.
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ARTICLE XI.
PURCHASE OF SYSTEM
SECTION 1. GENERAL
A. If at any time Grantee offers System for sale, City shall have the right to purchase
System. If at any time Grantee receives a bona fide purchase offer for the System which
Grantee is willing to accept, a complete copy of such offer shall promptly be given to
City and City shall have the right to purchase System according to the terms of the offer.
City shall exercise such right by submitting to Grantee, within 60 days after City's actual
receipt of the bona fide offer, notice that City desires to purchase the System pursuant to
said offer. If City does not exercise such right the System may be sold, but only on the
terms submitted to City. If any changes are made in the purchase offer given to City,
such purchase offer, as so changed, shall again be given to City and City shall have 60
days from actual receipt by City of the offer, as changed, within which to exercise its
right to purchase the System pursuant to the offer, as changed, all as above provided. If
City does not exercise its right to purchase the System pursuant to any offer given to City
pursuant to this paragraph, and the System is not sold to the buyer and on the terms set
out in the offer given to City, then the right of City to purchase the System shall continue,
and all subsequent purchase offers shall be given to City pursuant to this paragraph.
Also, the City's right to purchase pursuant to this paragraph shall survive every sale to a
buyer and shall continue and be binding upon every buyer of the System.
B. Upon forfeiture, revocation or termination of this Franchise, or at the normal expiration
of the Franchise term, City shall have the right to purchase the System. Such right shall
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be exercised upon written notice to Grantee within six months after the occurrence of any
such event.
SECTION 2.
PROCEDURES
In the event City elects to exercise its right to purchase the System as provided in Section
IB of this Article, the following shall then apply:
A. City and Grantee shall negotiate all terms and conditions of the purchase of the System.
B. If City and Grantee cannot agree upon the terms and conditions of the purchase, City
shall have the right to proceed to arbitration. Arbitration shall commence and proceed
according to applicable Minnesota law except as follows:
(1) The parties shall, within 15 days of City's decision to proceed to arbitration,
appoint one arbitrator each who is experienced and knowledgeable in the purchase
and valuation of business property. Arbitrators shall each agree upon the
selection of a third arbitrator, similarly qualified, within 15 days after appointment
of the second arbitrator.
(2) Within 30 days after appointment of all arbitrators and upon ten days written
notice to parties, the arbitrators shall commence a hearing on the terms and
conditions of the purchase in dispute.
(3) The hearing shall be recorded and may be transcribed at the request and expense
of either party. All hearing proceedings, debates and deliberations 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.
(4) The arbitration panel shall be required to determine the purchase price of the
System according to the standards established in paragraph C below.
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(5) At the close of the hearings and within 30 days, the arbitrators shall prepare
written findings and make a written decision agreed upon by a majority of the
arbitrators which shall be served by mail upon City and Grantee.
(6) The decision of a majority of the arbitrators shall be binding upon both parties
except that City may, in its sole discretion and without any penalty or cost to City
of any kind, withdraw its offer to purchase within 90 days of receipt of the final
decision of a maj ority of the arbitrators.
(7) Either party may seek judicial relief to the extent authorized under Minnesota
Statutes, ~572.09 and ~572.19 as the same may be amended, and in addition,
under the following circumstances:
(a) A party fails to select an arbitrator;
(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 arbitrators have not proceeded expeditiously; or
(f) Based upon the record the arbitrators abused their discretion.
(8) In the event a Court of competent jurisdiction determines the arbitrators have
abused their 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 .
(9) Cost of arbitration shall be borne equally.
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C. In the event of forfeiture, revocation or termination, the purchase price of the System
shall be the fair market value of material and equipment in place. Good will shall not be
included in the purchase price of the System.
D. In the event City is purchasing upon normal expiration of the Franchise, the purchase
price shall be the value of an ongoing business.
E. Grantee expressly waives its rights, if any, to relocation costs that might otherwise be
provided by law.
F. The date of valuation shall be no earlier than the day following the date of revocation,
forfeiture, expiration or termination of this Franchise and no later than the date City
makes a written offer for the System.
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SECTION 1.
ARTICLE XII.
MISCELLANEOUS
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 City, which consent shall not be unreasonably withheld. Further, Grantee
shall not sell or transfer any stock or ownership interest so as to create a new controlling
interest except with the consent of City, which consent shall not be unreasonably
withheld. The transfers described in this paragraph shall, in the sole discretion of City, be
considered sale or transfer of Franchise within the meaning and intent in the following
paragraph.
B. Any sale or transfer of Franchise, including a sale or transfer by means of a fundamental
corporate change, requires the written approval of City. Any sale or transfer of Franchise
shall be subject to the provisions of Board rules prohibiting certain ownership. The
parties to the sale or transfer of Franchise shall make a written request to City for its
consent. City shall reply in writing within 30 days of actual receipt of the request and
shall indicate its approval of the request or its determination that a public hearing is
necessary. City shall conduct a public hearing on the request within 30 days of such
determination if it determines that a sale or transfer of Franchise may adversely affect the
Grantee's subscribers.
C. Unless otherwise already provided for by local law, notice of any such hearing shall be
given 14 days prior to the hearing by publishing notice thereof once in a newspaper of
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general circulation in the City. The notice shall contain the date, time and place of the
hearing and shall briefly state the substance of the action to be considered by City.
Within 30 days after the public hearing, City shall approve or deny in writing the sale or
transfer request.
D. Any sale or transfer of Franchise, including a sale or transfer by means of a fundamental
corporate change, requires notification to the Board by City. The notification shall be
accompanied by the written certification of the transferee that it meets all of the
requirements established by City for original Grantee including but not limited to
technical ability and financial stability. City shall cause to be sent to the Board at
Grantee's expense a copy of all public documents related to sale or transfer of the
Franchise.
E. The parties to the sale or transfer of only this Franchise, without the inclusion of the
System in which at least substantial construction has commenced, shall be required to
establish to the sole satisfaction of City that the sale or transfer of only this Franchise is in
the public interest.
F. For purposes of this section, fundamental corporate change means the sale or transfer of a
controlling interest in the stock of a corporation or the sale or transfer of all or a majority
of a corporation's assets, merger (including a parent and its subsidiary corporation),
consolidation or creation of a subsidiary corporation. For the purposes of this section,
fundamental partnership change means the sale or transfer of all or a majority of a
partnership's assets, change of a general partner in a limited partnership, incorporation of
a partnership, or change in the control of a partnership.
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G. The word "control", as used herein, is not limited to major stockholders, but includes
actual working control in whatever manner exercised. As a minimum, "control", as used
herein, means a legal or beneficial interest (even though actual working control does not
exist) of at least five (5%) percent. Every change, transfer or acquisition of control of
Grantee shall make the Franchise subject to cancellation unless and until City shall have
consented in writing thereto, which consent shall not be unreasonably withheld. For the
purpose of determining whether it shall consent to such change, transfer or acquisition of
control, City may inquire into the qualifications of the prospective controlling party, and
Grantee shall assist City in any such inquiry and pay all costs incurred by City in so
inquiring, including City staff time at a value determined by City.
H. In the absence of extraordinary circumstances, City will not approve any transfer or
assignment of the Franchise prior to substantial completion of construction of System, as
determined solely by City.
I. In no event shall a transfer or assignment of ownership or control be approved without
transferee becoming a signator to this Franchise.
1. Any transferee shall be subordinate to any right, title or interest of City.
SECTION 2.
REMOVAL AFTER TERMINATION OR REVOCATION
A. At the expiration of the term for which this Franchise is granted, or upon its revocation or
termination, as provided for herein, City shall have the right to require Grantee to
remove, at Grantee's expense, all or any portion of the System from all streets and public
property within City. In so removing the System, Grantee shall refill and compact at its
own expense any excavation that shall be made by it and shall leave all streets and public
property in as good a condition as that prevailing prior to Grantee's removal of the
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System, and without affecting, altering or disturbing in any way electric, telephone or
other utility cables, wires or attachments. City shall have the right to inspect and approve
the condition of such streets and public property after removal. The Letter of Credit,
Bonds, Insurance, Indemnity and Penalty provisions of this Franchise shall remain in full
force and effect during the entire term of removal.
B. If, in the sole discretion of City, Grantee has failed to commence removal of System, or
such part thereof as was designated by City, within 30 days after written notice of City's
demand for removal is given, or if Grantee has failed to complete such removal within
one year after written notice of City's demand for removal is given, City shall have the
right to exercise one of the following options:
(1) Declare all right, title and interest to the System to be in City with all rights of
ownership including, but not limited to, the right to operate the System or transfer
the System to another for operation by it.
(2) Declare the System abandoned and cause the System or such part thereof, as City
shall designate, to be removed at no cost to City. The cost of said removal shall
be recoverable from the Letter of Credit, Bonds, Insurance, Indemnification and
Penalties provided for in this Franchise, or from Grantee directly as a liquidated
damage.
C. Any portion of the System not designated by City for removal shall belong to and become
the property of City without payment to Grantee and Grantee shall execute and deliver
such documents, as City shall request, in form and substance acceptable to City, to
evidence such ownership by City.
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SECTION 3.
WORK PERFORMED BY OTHERS
A. Grantee shall give notice to City specifying the names and addresses of any other entity,
other than Grantee, which performs services pursuant to this Franchise, provided,
however, that all provisions of this Franchise remain the responsibility of Grantee.
B. All provisions of this Franchise shall apply to any subcontractor or others performing any
work or services pursuant to the provisions of this Franchise.
SECTION 4.
INTEREST RATE
For purposes of this Franchise, prime rate shall mean the interest charged from time to
time by the First National Bank of Minneapolis for 90 day unsecured loans to commercial
borrowers of the highest credit rating.
SECTION 5.
GENERAL PROVISION ON RIGHTS AND REMEDIES
A. All rights and remedies given to City by this Franchise shall be in addition to and
cumulative with any and all other rights or remedies, existing or implied, now or hereafter
available to City at law or in equity, and such rights and remedies shall not be exclusive,
but each and every right and remedy specifically given by this Franchise or otherwise
existing or given may be exercised from time to time and as often and in such order as
may be deemed expedient by City, and the exercise of one or more rights or remedies
shall not be deemed a waiver of the right to exercise at the same time or thereafter any
other right or remedy. No delay or omission of City in the exercise of any right or
remedy shall impair any such right or remedy, nor shall any such delay or omission be
construed to be a waiver of or acquiescene to any default. The exercise of any such right
or remedy by City shall not release Grantee from its obligations, or any liability, under
this Franchise.
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B. In addition to all other remedies granted or available to City, City shall be entitled to the
restraint by injunction of the violation, or attempted or threatened violation, by Grantee of
any terms or provisions of this Franchise, or to a decree compelling performance by
Grantee of any term or provision of this Franchise.
SECTION 6.
APPLICABLE LAWS AND COURT DECISIONS: SEVERABILITY
A. This Franchise shall at all times be in compliance with the rules of the Board.
B. Grantee and City shall, at all times, comply with all laws, ordinances and regulations of
federal, state and City government relating to System and this Franchise, as they become
effective.
C. If any law, ordinance or regulation shall require or permit Grantee to perform any service
or shall prohibit Grantee form performing any service which may be in conflict with the
terms of this Franchise, then as soon as possible following knowledge thereof, Grantee
shall notify City of the point of conflict believed to exist between such law, ordinance or
regulation and this Franchise.
D. If City determines that any provision of this Franchise is affected by such law, ordinance
or regulation, City shall have the right to amend, modify, alter or repeal any of the
provisions of this Franchise to such reasonable extent as may be necessary to carry out
the intent and purpose of this Franchise, and Grantee hereby agrees to such amendment,
modification, alteration or repeal of this Franchise.
E. To the extent any provision of the Offering is not specifically set out in this Franchise or
not validly incorporated herein by reference, City from time to time may amend this
Franchise to include such provision effective as of the date of commencement of the
Franchise term or any such rule effective as of the date of commencement of the
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Franchise term or adoption of the rule, whichever is later. Grantee, by acceptance of this
Franchise, consents to and agrees to be bound by any such amendments.
F. If any term, condition or provision of this Franchise or the application thereof to any
person or circumstance shall, to any extent, be held to be invalid or unenforceable, the
remainder hereof and the application of such term, condition and provision to persons and
circumstances other than those as to whom it shall be held invalid or unenforceable shall
not be affected thereby, and this Franchise and all the terms, provisions and conditions
hereof shall, in all other respects, continue to be effective and to be complied with.
SECTION 7.
GRANTEE ACKNOWLEDGMENT OF V ALInITY OF FRANCHISE
Grantee acknowledges that it has had an opportunity to review the terms and conditions
of this Franchise and that under current law Grantee believes that said terms and conditions are
not unreasonable or arbitrary, and that Grantee believes the City has the power to make the terms
and conditions contained in this Franchise.
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SECTION 1.
ARTICLE XIII.
ADMINISTRATION AND ADVISORY BODY
ADMINISTRATOR
The City Administrator or the City Administrator's designee shall be responsible for the
continuing administration of this Franchise. The Administrator may be changed by City from
time to time by written notice given to Grantee.
SECTION 2.
ADVISORY BODY
City may appoint an advisory body to monitor the performance of Grantee in executing
the provisions of this Franchise. The advisory body shall perform all functions required of it by
the Council and applicable laws, ordinance, rules and regulations.
SECTION 3. DELEGATION OF AUTHORITY BY CITY
A. City reserves the right to delegate and redelegate from time to time any of its rights or
obligations under this Franchise to any body or organization.
B. Any delegation by City shall be effective upon written notice by City to Grantee of such
delegation.
C. Upon receipt of notice by Grantee of City's delegation, Grantee shall be bound by all
terms and conditions of this delegation not in conflict with this Franchise.
D. Any such delegation, revocation or redelegation, no matter how often made, shall not be
deemed an amendment to this Franchise or require any consent of Grantee.
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ARTICLE XIV.
JOINT SYSTEM, ACCEPTANCE,
INCORPORATION OF OFFERING, EXHIBITS, PUBLICATION
SECTION 1.
OTHER FRANCHISES
A. The System intended for City may be part of a joint system that serves the cities of
Andover, Anoka, Champlin and Ramsey, Minnesota.
B. Grantee will, in good faith, apply for and accept, if offered to it, a franchise (similar
franchise) from each of the cities on all the same terms and conditions herein provided,
except provisions omitted as inapplicable.
C. Notwithstanding any other provision of this Franchise, ifless than all of the other of said
cities offer a similar franchise to Grantee, which is accepted by Grantee, Grantee or City
may cancel this Franchise and all of their obligations hereunder by written notice given to
the other not later than 30 days after all the other of said cities shall have formally acted
upon their respective franchise ordinances; provided, that if Grantee elects to cancel all
other franchises pursuant hereto, it must also cancel all other franchises granted to it by
the other of said cities effective simultaneously herewith.
SECTION 2.
TIME OF ACCEPTANCE: GUARANTEE: INCORPORATION OF
OFFERING: EXHIBITS
A. Grantee shall have 30 days from the last date of adoption of a similar franchise by all of
the cities listed in Section lA of this Article, to accept this Franchise in form and
substance acceptable to City. However, in no event will acceptance occur later than 90
days after the adoption of this Franchise, unless the time for acceptance is extended by
City. Such acceptance by Grantee shall be deemed the grant of this Franchise for all
purposes.
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B. Upon acceptance of this Franchise, Grantee shall be bound by all the terms and
conditions contained herein. Grantee shall provide all services and offerings specifically
set forth in the Offering to provide cable communication service within City and other
cities included in or a part of a joint system; and, by its acceptance of this Franchise,
Grantee specifically agrees that the Offering of Grantee, including all promises, offers,
representations and inducements contained therein, is specifically incorporated by
reference and made part of this Franchise. The failure to refer to the Offering in any
specific provisions of this Franchise shall not be a limitation on the obligation of Grantee
to fully comply with the Offering. Grantee further acknowledges that all promises,
offers, representations and inducements contained in the Offering of Grantee were freely
and voluntarily made to City by Grantee.
C. The Offering shall be permanently kept and filed in the Office of the City Clerk and the
originals or reproductions thereof shall be available for inspection by the public during
normal business hours. Also, the Grantee may summarize the Offering in a manner
acceptable to City or reproduce the entire Offering, and shall have either at the following
locations in the following quantities:
(1) Office of the City Clerk - 1 copy;
(2) Administrator designated in this Franchise - 1 copy;
(3) Public libraries - 1 copy each;
(4) Office of the City Attorney - 1 copy;
(5) Anoka and Hennepin County Law Library - I copy each;
(6) Local office of Grantee - 1 copy each;
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(7) Office of any School District in City - 1 copy;
(8) Minnesota Cable Communication Board.
D. In the event of conflicts or discrepancies between any part of the Offering and the
provisions of this Franchise or between any part of the summary made by Grantee and the
Offering, those provisions which provide the greatest benefit to City, in the opinion of the
Council, shall prevail.
E. Grantee shall have continuing responsibility for this Franchise, and if Grantee be a
subsidiary or wholly owned corporate entity of a parent corporation, performance of this
Franchise shall be secured by guarantees of the parent corporation in form and substance
acceptable to City, which shall be delivered at time of, and as part of, acceptance of this
Franchise.
F. With its acceptance, Grantee also shall deliver to City an opinion from its legal counsel,
acceptable to City, stating that this Franchise has been duly accepted by Grantee, that the
guarantees have been duly executed and delivered, that this Franchise and the guarantees
are enforceable against Grantee and the guarantors in accordance with their respective
terms, and which opinion shall otherwise be in form and substance acceptable to City.
G. With its acceptance, Grantee also shall deliver to City true and correct copies of
documents creating Grantee and evidencing the power and authority referred to in the
opinion of Grantee's counsel, certified as of a then current date by public office holders to
the extent possible and otherwise by an officer of Grantee.
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..
~~
H. Each exhibit is part of this Franchise and each is specifically incorporated herein by
reference. The exhibits are as follows:
Exhibit A - Grantee Schedule of Rates
Exhibit B - Form G, Page 2 of20
Exhibit C - Offering of Grantee
Passed and adopted this
day of
,1982.
ATTEST:
CITY OF ANDOVER
BY
BY
Mayor
This Franchise is accepted, and we agree to be bound by all its terms and conditions.
TELEPROMPTER OF QUAD CITIES,
INC.
DATED:
BY
Its
BY
Its
78
ORDINANCE SUMMARY
Ordinance No. 59C
City of Andover
AN ORDINANCE AMENDING ORDINANCE NO. 59 REGARDING
THE FRANCHISE AGREEMENT BETWEEN THE CITY OF ANDOVER
AND GROUP W CABLE OF THE QUAD CITIES, INC.
The Council of the City of Andover does ordain:
1. Article VI. SYSTEMS OPERATIONS
Section 4.
Franchise Fees, Rates, Charges, Changes
in Fees and Procedures
The franchise fee specified in Article VI, Section
4.B.(1) of the Franchise Agreement is amended to provide
that quarterly payments of franchise fees will be made
within ninety (90) days after end of each quarter with
adjustments at year end for actual Gross Revenues.
2. Amended Exhibit A - Rates
Group W's Schedule of Rates and Services as set
forth in Exhibit A to the Franchise Agreement is amended
in its entirety to provide for the rates and services as
set forth in Attachment II of Amendment Agreement No.
2. The complete Attachment II is available for inspec-
tion at the city offices.
These amendments shall take effect and be enforced
after their passage and official publication.
The amendments were passed and adopted the 17th day
of December, 1985.
CITY OF ANDOVER
ATTEST:
~ t..c" ,. ~I'..p
J ry indschltl, Mayor
a A. Peach, City Clerk/Treasurer
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59
AN ORDINANCE INCLUDING ADDENDUM WITH EXHIBITS, GRANTING A
FRANCHISE TO TELEPROMPTER OF QUAD CITIES, INC. A MINNESOTA
CORPORATION, TO OPERATE AND MAINTAIN A CABLE COMMUNICATION
SYSTEM IN THE CITY: SETTING FORTH CONDITIONS ACCOMPANYING
THE GRANT OF FRANCHISE: PROVIDING FOR REGULATION, AND USE
OF THE SYSTEM: AND PRESCRIBING PENALTIES FOR THE VIOLATION
OF ITS PROVIS.IONS.
Ordinance Copy on File in Office
of City Clerk - 1685 Crosstown
Boulevard Northwest - City of
Andover, Minnesota 55303
Adopted by the City Council of the City of Andover this
20th
day of
Apr il
, 1982.
CITY OF ANDOVER
ATTEST~
~LJ~
Jer Wi schitl - Mayor
/
/
i
I
~-
Clerk
. l. ')
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO. 59D
AN ORDINANCE AMENDING CABLE FRANCHISE ORDINANCE NO. 59/ ARTICLE II,
SECTION 4, FRANCHISE TERM.
The City Council of the City of Andover hereby ordains:
SECTION 1. Ordinance No. 59/ Article II, Section 4, Franchise Term, is hereby amended to
read:
Section 4. Franchise Term
This Franchise shall commence upon acceptance by Grantee and shall expire on September 9,
1998.
SECTION 2. This ordinance shall be effective upon passage and official publication.
Adopted by the City Council of the City of Andover this 4th day of March. 1997.
CITY OF ANDOVER
Attest:
.' . (',
d~---;t . , /1 ,4/.
~.J..AL./ (....-'~
Victoria V olk - City Clerk
Accepted by Grantee this -1/
day of /lJ;' /P ~
, 1997.
GROUP W OF THE QUAD CITIES, INC.
CITY OF ANDOVER )
COUNTY OF ANOKA ) ss
STATE OF MINNESOTA)
I, the undersigned, being the duly qualified and acting City Clerk of the
City of Andover, Minnesota, do hereby certify that I have carefully
compared the attached Ordinance No. 59D
with the original record thereof preserved in my office and have found
the same to be a true and correct transcript of the whole thereof.
IN TESTIMONY WHEREOF, I have hereunto subscribed my hand this
18th day of Mar.ch,1997.
CITY OF ANDOVER
(Sea.1)
1" /
/,t~ tJrtfL/
Victoria V olk - City Clerk
RESOLUTION NO. 5.J ~?0.1 ADOPTING FINDINGS
OF FACT, CONCLUSIONS, AND RECOMMENDED
RESOLUTION REGARDING THE TRANSFER OF
OWNERSHIP AND CONTROL OF GROUP W CABLE,
INC. AND THE TRANSFER OF THE FRANCHISE
ORDINANCE TO NORTH CENTRAL CABLE COMMUNI-
CATIONS, L.P.
INTRODUCTION
The Quad Cities Cable Communications Commission (herein-
after "Commission") is organized pursuant to the terms of a
Joint and Cooperative Agreement for the Administration of a
Cable Television Franchise (hereinafter "Agreement"), as
authorized by Minnesota Statutes Section 471.59, as
amended. The Member Cities of the Commission include Anoka,
Champlain, Ramsey, and Andover, Minnesota (hereinafter
"Member Cities").
This proceeding involves the Commission's review, on
behalf of the Member Cities, of a request by Group W Cable,
Inc. and Group W Cable of the Quad Cities, Inc. (hereinafter
collectively "Group W") to approve the transfer of ownership
and control of Group Wand transfer of the Cable Communica-.
tions Franchise Ordinance to North Central Cable Communica-
tions, L.P. (hereinafter "North Central").
Notice is hereby given that the Member Cities will make
the final determination of this matter. Further, notice is
hereby given that the Member Cities, may at their own dis-
cretion, accept or reject the Commission's recommendation
and that said recommendation has no legal effect unless ex-
pressly adopted by the Member Cities as their final deci-
sion.
STATEMENT OF ISSUE
The purpose of this proceeding is to determine whether
the Member Cities of the Commission should consent to the
transfer of ownership and control of Group Wand the trans-
fer of the Cable Communications Franchise Ordinance (herein-
after "Franchise") to North Central.
Based upon all the proceedings herein, the Commission
makes the following:
FINDINGS OF FACT
1. On February 10, 1986, the Commission and its Member
Cities received an official notice from Group W Cable,
Inc., by and on behalf of its wholly-owned subsidiary
Group W Cable of the Quad Cities, Inc., requesting two
forms of approval:
a) Consent to a change in control and transfer of
ownership in Group W to a group of five Buyers
(transaction one): and
b) Consent to a change in control and transfer of
ownership in Group Wand transfer of the Cable
Communications Franchise Ordinance to North
Central Cable Communications, L.P. (trans-
action two).
2. On February 21, 1986, the Commission sent to Group Wand
North Central a Municipal Request for Information Re-
garding Request For Approval and Transfer for the pur-
pose of inquiring into the legal, technical, financial,
and other qualifications of North Central, as authorized
and required by state law and the Franchise.
3. The Commission requested the return of the Municipal
Request For Information from Group Wand North Central
by March 7, 1986 so that it would have sufficient time
to review the information. North Central filed its
response to the Municipal Request For Information on
March 24, 1986.
4. The Commission received on April 14, 15, and 17 a
request from Group W, North Central, and the Buyers,
respectively to bifurcate its consideration of the two
transactions. Group W, North Central, and the Buyers
stated in effect that consent to the first transaction
would in no way be construed or viewed as consideration
or consent to the second transaction.
5. The Commission gave notice and held a public hearing on
April 9, 1986 for the purpose of providing the public
with an opportunity to comment on the two transactions.
6. On April 9, 1986 the Commission reviewed and discussed
the information it had received from Group Wand North
Central. The Commission unanimously passed a resolution
recommending to the Member Cities approval of trans-
action one. However, the Commission determined it
necessary to continue the public hearing with respect to
transaction two because of incomplete responses to
requests for information from North Central.
7. The proposed transaction two involves Daniels & Associ-
ates, Inc., a Delaware Corporation: Daniels-Hauser Hold-
ing Company, a Colorado general partnership: North
- 2 -
Central Cable Communications L.P., a Minnesota limited
partnership-;, ~and Hauser Cable Communications, Inc., a
Delaware Corporation.
8. The Commission has reviewed the necessary documentation
of each of the entities identified in Finding No. 7 to
conclude that each of the entities is duly organized and
authorized to own and operate a cable system.
9. The Commission has reviewed the character qualifications
of North Central and its principals and found them to be
satisfactory.
10. The Commission has reviewed the technical ability of
North Central for the purpose of establishing its tech-
nical expertise and experience in operating and main-
taining a cable system. Since North Central is a new
organization created for the purpose of accomplishing
the transaction, the Commission inquired into the tech-
nical ability of its managing principals.
11. The information provided shows that Mr. Gustave Hauser,
Mr. John D. Evans, and Hauser Communications, Inc. have
extensive cable management experience. Mr. Hauser has
been involved in cable television and other electronic
communications since the early 1960's. Mr. Evans has 13
years of management experience in the cable television
industry, including Arlington, Virginia, Columbus, Ohio,
and Brooklyn Center, Minnesota. Hauser Communications,
as a manager of cable systems, has experience in
Arlington and Brooklyn Center.
12. The technical ability of the individuals and other en-
tities related to North Central in owning, operating,
and managing cable systems is satisfactory.
13. The Commission has attempted to review the financial
capability of North Central for the purpose of determin-
ing whether it has the financial resources available or
committed to not only acquire the cable system, but also
to meet the franchise commitments to operate the cable
system. The Commission engaged an independent financial
communications consultant to assist in this analysis.
14. North Central has not provided sufficient information
regarding closing costs and working capital to determine
whether the amounts are reasonable or whether such funds
are available to North Central and if available, are
adequate. North Central estimates $1 million for this
factor, but has failed to provide sufficient detailed
information of the specific amounts.
- 3 -
15. North Central has not documented their analysis or
assumptions to support a projected household growth of 2
percent in the franchise area. The Commission deter-
mines this projection is unreasonable in light of the
projected household growth of the Membe~ Cities for
1986. Andover,.Anoka, Champlain, and Ramseyrespec-
tively project a 6.5 percent, 1 percent, 9 percent, and
7.5 percent household growth in 1986. Future expansion
of the system is therefore undercapitalized.
16. North Central has not provided its assumptions regarding
the percentage price increases for basic and pay ser-
vices. The Commission is unable to determine the rea-
sonableness of this projection.
17. North Central has not provided sufficient detailed in-
formation at this time to enable the Commission to de-
termine the reasonableness of its operating expense
assumptions, including but not limited to repairs and
maintenance, system maintenance, postage and billing,
converter maintenance, vehicle operation, light, heat,
power, and pole rental.
18. North Central has not provided sufficient detailed in-
formation at this time to enable the Commission to de-
termine the reasonableness of its administrative expense
assumptions, including but not limited to telephone,
insurance, rent, legal fees, repairs and maintenance,
consulting services, and employee benefits.
19. North Central has not provided sufficient detailed in-
formation at this time to enable the Commission to de-
termine the reasonableness of its marketing expense
assumptions, including but not limited to telephone
marketing, data processing, contract sales, direct sales
override, direct mail promotions, mass media promotions,
and subscriber maintenance.
20. For all expenses, North Central has not documented its
assumptions for general inflation on a line-by-line
basis.
21. North Central has not provided sufficient detailed in-
formation at this time to enable the Commission to de-
termine the reasonableness of its capital expenditure
assumptions, including but not limited to office elec-
tronics, billing computer, telephone installation and
future construction.
22. The Commission has requested from North Central the
financial information and operational assumptions to
review the items listed above for the purpose of analyz-
- 4 -
ing its overall financial plan and financial ability.
However, despite the request, NOIthCentral has not
adequately provided the information.
23. North Central has not provided supporting documentation
showing the terms and conditions of its financing avail-
able to meet the franchise requirements and operational
plans. For the purpose of reviewing its overall finan-
cial plan, confirmation of the terms and conditions of
financing are necessary. Moreover, North Central has
not provided supporting documentation of the terms and
conditions of its financing for the purpose of reviewing
its impact on the operational plans of the system.
24. The cablesystem has experienced short-term operating
expense shortfalls in the recent preceding years. While
it is assumed by the Commission that any transferee of
the system would attempt to remediate such shortfalls,
North Central has failed to demonstrate that it could
financially withstand such short-term deficits:
25. The information which has been supplied by North Central
represents in large part financial information for six
cable systems in Minnesota. The Commission represents
one of those six systems. The Commission finds it
impossible to analyze the financial ability of North
Central relative to this system without system specific
financial information.
26. North Central has established as its financial goals a
minimum operating margin of 40%, subscriber penetrations
from 43% to 55%, and a minimum rate of return on invest-
ment of 15%. North Central has not supplied sufficient
financial information and documentation for the Commis-
sion to determine whether its financial plans will
achieve the aforementioned goals. As a result of exist-
ing experience in the system, the Commission determines
these goals and projections are unreasonable.
27. Absent sufficient financial information from North
Central, the Commission determines that the financial
ability of North Central to meet existing and future
obligations is inadequate. The Commission also notes
for the record that the existence of sufficient finan-
cial information would not in and of itself have led to
a finding of adequate financial ability. The existence
of such information would have served only as a basis
for the Commission to perform a complete financial
analysis which mayor may not have resulted in a deter-
mination that North Central was financially able to
fulfill existing and future obligations.
- 5 -
28. The Commission determines the financial qualifications
of North Central are unsatisfactory and unacceptable.
Pertinent Franchise provision
The standard of review in this matter is the relevant
portion of Article XII, Section 1 of Cable Communications
Franchise Ordinance, which provides in part as follows:
A. This Franchise shall not be assigned or trans-
ferred, either in whole or in part, or leased,
sublet or mortgaged in any manner, not 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 City, which consent shall
not be unreasonably withheld. Further Grantee
shall not sell or transfer any stock or owner-
ship interest so as to create a new controll-
ing interest except with the consent of City,
which consent shall not be unreasonably with-
held. The transfers described in this para-
graph shall, in the sole discretion of City,
be considered a sale or transfer of Franchise
within the meaning and intent in the following
paragraph.
Similarly, Minnesota Statutes Section 238.083, subdivi-
sion 4 provides:
Within 30 days after the public hearing, the fran-
chising authority shall approve or deny in writing
the sale or transfer request. The approval must
not be unreasonably withheld.
Based upon the foregoing Findings of Fact, the Quad
Cities Cable Communications Commission makes the following:
CONCLUSIONS
1. The Commission, on behalf its Member Cities, gave proper
notice of the public hearing in this matter, has ful-
filled all relevant substantive and procedural require-
ments of law or rules and has the authority to make a
determination as to Transaction No. 2 and to recommend
that determination to its Member cities.
2. North Central has met the legal and character qualifica-
tions.
3. North Central has met the technical qualifications.
- 6 -
4. North Central has not met the financial qualifications
nor has North Central demonstrated it has the financial
qualifications sufficient to own and operate the cable
system.
5. Any of the foregoing Findings of Fact which might be
properly termed Conclusions are hereby adopted as such.
THIS REPORT IS NOT AN ORDER AND NO AUTHORITY IS GRANTED
HEREIN. THE MEMBER CITIES OF THE COMMISSION MUST ISSUE
A FINAL DETERMINATION WHICH MAY ADOPT OR DIFFER FROM THE
FOLLOWING RECOMMENDATION.
It is the recommendation of the Quad Cities Cable Com-
munications Commission to its Member Cities that it adopt
the following:
RESOLUTION
IT IS HEREBY RESOLVED and based upon the Findings of
Fact and Conclusions of the Quad Cities Cable Communications
Commission (attached hereto and made a part hereof) that the
City denies the request to transfer the ownership of and
control of Group W Cable of the Quad Cities, Inc. and trans-
fer of ,the Cable Communications Franchise Ordinance to North
Central Cable Communications L.P.
The above listed Findings of
recommended resolution was moved
I- \'c-k and duly seconded
t< e ~ YY\ 0\.1'\ VI .
.
The following Commission Directors voted in the affirma-
tive:
~ lc..-k) J o--co b S dh)
Fact, Conclusions and
by Commission Director
by Commission Director
,1 ~ ;.))'1(. I
)
J1Je}-rosf' j( e~ ""^Io,YI
/
The following Commission Directors voted in the nega-
tive:
IV oN t:
- 7 -
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59
AN ORDINANCE INCLUDING ADDENDUM WITH EXHIBITS, GRANTING A
FRANCHISE TO TELEPROMPTER OF QUAD CITIES, INC. A MINNESOTA
CORPORATION, TO OPERATE AND MAINTAIN A CABLE COMMUNICATION
SYSTEM IN THE CITY: SETTING FORTH CONDITIONS ACCOMPANYING
THE GRANT OF FRANCHISE: PROVIDING FOR REGULATION, AND USE
OF THE SYSTEM: AND PRESCRIBING PENALTIES FOR THE VIOLATION
OF ITS PROVISIONS.
Ordinance Copy on File in Office
of City Clerk - 1685 Crosstown
Boulevard Northwest - City of
Andover, Minnesota 55303
Adopted by the City Council of the City of Andover this
20th
day of
Apr il
, 1982.
I
CITY OF ANDOVER
ATTES~
!
~ IAJ~
JerWi schitl - Mayor
I
I
~
Clerk
CITY OF ANDOVER
COUNTY OF ANOKA
STATE OF MINNESOTA
ORDINANCE NO.59
AN ORDINANCE INCLUDING ADDENDUM WITH EXHIBITS, GRANTING A
FRANCHISE TO TELEPROMPTER OF QUAD CITIES, INC. A MINNESOTA
CORPORATION, TO OPERATE AND MAINTAIN A CABLE COMMUNICATION
SYSTEM IN THE CITY: SETTING FORTH CONDITIONS ACCOMPANYING
THE GRANT OF FRANCHISE: PROVIDING FOR REGULATION, AND USE
OF THE SYSTEM: AND PRESCRIBING PENALTIES FOR THE VIOLATION
OF ITS PROVISIONS.
Ordinance Copy on File in Office
of City Clerk - 1685 Crosstown
Boulevard Northwest - City of
Andover, Minnesota 55303
Adopted by the City Council of the City of Andover this 20th
day of
April
, 1982.
CITY OF ANDOVER
~LJ~
Jer Wi schitl - Mayor
Clerk
~