HomeMy WebLinkAbout2000-11 Cable Television Franchise Agreement With Everest MN, LLC Rescinded By 2001-4Ib 4
City of Edina, Minnesota
and
Everest Minnesota Licensee, LLC
Cable Television
Franchise Agreement Ordinance
No. 2000-11
384348/1
Prepared by:
Brian T. Grogan, Esq.
MOSS & BARNETT
A Professional Association
4800 Wells Fargo Center
90 South Seventh Street
Minneapolis, MN 55402-4129
Telephone: (612) 347-0340
Facsimile: (612) 339-6686
With the assistance of:
The Southwest Suburban
Cable Commission
TABLE OF CONTENTS
SECTION 1. GRANT OF FRANCHISE........................................................................1
SECTION2. SHORT TITLE..........................................................................................1
SECTION3. DEFINITIONS...........................................................................................1
SECTION 4. EFFECTIVE DATE AND TERM OF RENEWAL................................2
SECTION5. WRITTEN NOTICE.................................................................................2
SECTION6. DESIGN PROVISIONS............................................................................2
6.1 System Design.........................................................................................................2
6.2 Cable Nodes System Connect................................................................................2
6.3
Service to the Schools and Government Buildings.............................................3
6.4
Parental Control Lock...........................................................................................3
6.5
Standby Power.......................................................................................................3
6.6
Periodic Review Provisions...................................................................................4
6.7
Shared Use of Facilities.........................................................................................5
6.8
Verification of System Construction....................................................................5
6.9
Franchising Cost Reimbursement........................................................................5
SECTION 7. PUBLIC, EDUCATIONAL AND GOVERNMENTAL ACCESS
PROGRAMMING.....................................................................................5
7.1 Access Channels.....................................................................................................5
7.2 Studio/Facilities......................................................................................................6
7.3 Funding for PEG Access.......................................................................................7
7.4 Regional Channel Six.............................................................................................7
7.5 Override of the Government Access Channel.....................................................7
SECTION 8. INSTITUTIONAL NETWORK...............................................................8
SECTION 9. PERIODIC CUSTOMER SURVEYS....................................................15
SECTION 10. LINE EXTENSION POLICY................................................................16
SECTION 11. GENERAL FINANCIAL AND INSURANCE PROVISIONS ........... 16
11.1 Payment to City....................................................................................................16
11.2 Bonds.....................................................................................................................16
11.3 Security Fund.......................................................................................................17
SECTION 12. PUBLIC COMMITMENT......................................................................20
SECTION 13. COMPETITION ADJUSTMENT..........................................................20
384348/1 1
V
SECTION14. ACCEPTANCE........................................................................................25
14.1 Other Franchises..................................................................................................25
14.2 Time of Acceptance; Incorporation of Offering; Exhibits...............................25
EXHIBITS
Exhibit A - Franchise Fee Payment Worksheet.......................................................................... A-1
Exhibit B - List of Public Schools and Buildings........................................................................B-1
Exhibit C — Everest Minnesota Licensee, LLC Initial Programming..........................................0-1
Exhibit D — Minimum I -Net Performance Standards................................................................. D-1
ExhibitE - I -Net User Sites........................................................................................................ E-1
384348/1 ii
FRANCHISE AGREEMENT ORDINANCE
This Agreement, made and entered into this day of , 2000,
by and between the City of Edina, Minnesota, a municipal corporation of the State of Minnesota,
and Everest Minnesota Licensee, LLC.
WITNESSETH
WHEREAS, Everest Minnesota Licensee, LLC has requested that the City of Edina,
Minnesota, grant it a cable television Franchise; and
WHEREAS, the City is authorized to grant one or more nonexclusive revocable
Franchises to operate, construct, maintain and reconstruct a Cable Television System within the
City; and
WHEREAS, the City reviewed the legal, technical and financial qualifications of Everest
Minnesota Licensee, LLC and, after a properly noticed public hearing, has determined that it is
in the best interest of the City and its residents to grant a Franchise to Everest Minnesota
Licensee, LLC.
NOW, THEREFORE, the City of Edina, Minnesota (hereinafter also known as the "City"
or "Grantor") hereby grants to Everest Minnesota Licensee, LLC (hereinafter the "Grantee") a
cable television Franchise in accordance with the provisions of Ordinance No. and
this Agreement.
SECTION 1. GRANT OF FRANCHISE
Everest Minnesota Licensee, LLC is hereby granted a cable television Franchise. This
Franchise shall be subject to the terms and conditions of this Franchise Agreement Ordinance
and shall be subordinate to the Cable Television Franchise Ordinance and all applicable federal,
state and local law.
SECTION 2. SHORT TITLE
This Agreement shall be known and cited as the "City of Edina, Minnesota Cable
Television Franchise Agreement Ordinance." Within this document it shall also be referred to as
"this Franchise" or "the Franchise."
SECTION 3. DEFINITIONS
The definitions contained in Ordinance Number of the City of Edina,
Minnesota are incorporated herein by reference and adopted as fully as if set out verbatim.
384348/1
SECTION 4. EFFECTIVE DATE AND TERM OF RENEWAL
This Franchise shall commence on the effective date described in Section 13 and shall
expire on December 31, 2015.
SECTION 5. 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 Manager 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 Edina, Minnesota
4801 West 50th Street
Edina, MN 55424
If to Grantee: Everest Minnesota Licensee, LLC
5555 Winghaven Boulevard
O'Fallon, MO 63366
Such addresses may be changed by either party upon notice to the other party given as
provided in this section.
SECTION 6. DESIGN PROVISIONS
6.1 System Design
Grantee shall construct a Hybrid Fiber Coax (HFC) System to a capacity of 860
MHz. Grantee's System will be designed to support a forward bandwidth of
50MHz - 860 MHz and a return bandwidth of 5MHz — 40 MHZ. As designed, the
System will have a capacity of at least 300 channels. The System shall serve an
average of 150 homes per node. System construction shall be completed and in
use within thirty-six (36) months from the Effective Date of this Franchise.
6.2 Cable Nodes System Connect
Grantee will locate its "nodes" near schools where possible, without (in Grantee's
opinion) compromising the engineering design of the System. The City will
provide maps showing the location of the schools.
384348/1 2
6.3 Service to the Schools and Government Buildings
A. Service to Public Schools and Public Buildings
The Grantee shall provide one outlet of Basic Service, the Cable
Programming Service Tier and one Converter, if needed, to those
facilities provided in Exhibit B. Service to public schools and
municipally owned buildings constructed or occupied after the
effective date of this Franchise shall be similarly provided subject
to the building being located within 200 feet of the Grantee's then
existing System.
2. If facility is over 200 feet from Grantee's then existing System, the
school or municipality shall be responsible for all equipment,
construction costs and additional wiring beyond the first 200 feet
that are the Grantee's responsibility.
3. All internal wiring cost beyond the one outlet that Grantee agrees
to provide shall be the responsibility of the school or municipality.
4. The financial responsibility for any additional Converters desired
by the school or municipality shall be their responsibility.
B. Service to Private Schools
Grantee shall provide Installation to private schools within 200 feet of
plant. A private school is defined as any private secondary school that
receives funding pursuant to Title 1 of the Elementary and Secondary
Education Act of 1965. Installation and Cable Service (Basic Service and
Cable Programming Service Tier) shall be provided for free to such
private schools through the year 2011.
6.4 Parental Control Lock
Grantee shall provide, for sale or lease, to Subscribers, upon request, a parental
control locking device.
6.5 Standby Power
Grantee shall provide standby power throughout the System capable of providing
at least three hours of emergency supply.
6.6 Periodic Review Provisions
The City may request a State -of -the -Art review at any time between the sixth year
anniversary and the twelfth year anniversary of the granting of this Franchise. In
384348/1
conducting a State -of -the -Art review, the City shall undertake the following
process:
A. The City and the Grantee shall undertake a review of the then existing
Cable System. This review shall, at a minimum, take into account the
following:
Characteristics of the existing System;
2. The State -of -the -Art;
3. Additional benefits provided to customers by the State -of -the -Art;
4. The market place demand for the State -of -the -Art; and
5. The financial feasibility of the State -of -the -Art taking into account
associated rate increases, and the premature retirement of assets.
B. The City shall hold at least two public hearings to enable the general
public and Grantee to comment and to present evidence.
C. For the purposes of this Section the term "State -of -the -Art" shall mean
equipment or facilities that:
1. Are readily available with reasonable delivery schedules from two
or more sources of supply;
2. Have the capability to perform the intended functions
demonstrated within communities with similar characteristic
(including, but not necessarily limited to, population, density,
Subscriber penetration, etc.) under actual operating conditions for
purposes other than tests or experimentation; and
3. Are technically and economically feasible to implement. The term
"State -of -the -Art" shall not include equipment or facilities
associated with or dedicated to the general public, educational or
governmental access or telecommunication services.
D. Notwithstanding anything to the contrary, the City may not undertake a
State -of -the -Art review at any time the Grantee is deemed subject to
effective competition pursuant to then applicable state or federal law.
E. As a result of any review based on this Section, City and Grantee may
enter into good faith negotiations to amend this Franchise as agreed upon.
384348/1 4
6.7 Shared Use of Facilities
The Grantee must make space available on its poles and towers, or upon timely
request by the City, underground lines and conduit, for City wires, fixtures, or
City utilities, whenever such use will not interfere with the use of those facilities
by the Grantee or any other communication company. The City must pay for any
added expense incurred by the Grantee because of such City use.
6.8 Verification of System Construction
The City may, in its sole discretion, retain a technical consultant to conduct an on-
site review of Grantee's System to verify that construction has been completed in
compliance with all requirements of this Franchise and Applicable Laws. All
costs associated with a technical consultant for purposes described within this
Section 6.8, up to a cap not to exceed $15,000, shall be borne by Grantee and
shall not be deducted nor offset from any franchise fee payments which Grantee is
required to remit to City under this Franchise.
6.9 Franchising Cost Reimbursement.
Upon acceptance of this Franchise, Grantee shall provide City full reimbursement
for all reasonable and necessary franchising costs not already covered by
Grantee's application fee. Grantee's reimbursement of franchising costs shall not
be deducted or offset from any franchise fees which Grantee is required to remit
pursuant to this Franchise.
SECTION 7. PUBLIC, EDUCATIONAL AND GOVERNMENTAL ACCESS
PROGRAMMING
7.1 Access Channels
A. Grantee shall provide four public, educational and government (PEG)
Access Channels (the "Access Channels"). One channel shall be
dedicated to public access, one channel shall be dedicated to governmental
access, and two channels shall be dedicated to educational access.
B. Grantee shall provide to each of its Subscribers who receive all or any part
of the total services offered on the System, reception of each public,
educational and governmental Access Channel.
C. Grantee shall provide at least one specially designated access channel
available for lease on a first come, nondiscriminatory basis by commercial
and noncommercial users. This Section is not applicable to Subscribers
receiving only alarm system services or only data transmission services for
computer operated functions. The VHF spectrum shall be used for at least
384348/1 5
one of the specially designated noncommercial public Access Channels
required.
D. Whenever any of the Access Channels are 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 additional cost to Subscribers.
E. Grantee must establish rules and regulations for the public, educational
and leased Access Channels. The rules and regulations established by the
Grantee are subject to approval by the City.
F. 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. Subscribers receiving only alarm
system services or only data transmission services for computer operated
functions shall not be included in this requirement.
7.2 Studio/Facilities
A. Prior to the provision of Cable Service within the City, Grantee will
provide one large facility containing one studio with square footage of not
less than 1440 square feet for use by the cities of Eden Prairie, Edina,
Hopkins, Minnetonka and Richfield ("Member Cities") at a location
within the Member Cities mutually agreeable to Grantee and the Member
Cities for public, educational and governmental access production. The
studio will have the capacity for audience participation. The facility will
include two separate editing suites, storage space and the entire studio
facility will be wheelchair accessible. The facility shall be open during
the hours of Monday through Friday 10:00 a.m. to 6:00 p.m. and regular
weekend hours and some regular week night hours.
B. 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.
C. No charges shall be made for channel time or playback of prerecorded
programming on the specially designated noncommercial public Access
Channel. Grantee can include any costs associated with production and
384348/1 6
playback for the noncommercial public Access Channel in the total sum
allocated for public, educational and governmental access programming as
stated in Section 7.3. Additionally, at the City's request, Grantee will
work with the City to institute a nominal membership fee for users of the
PEG access facility.
D. Need within the meaning of this section shall be determined in the sole
discretion of City or by Subscriber petition. Said petition 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.
7.3 Funding for PEG Access
Prior to the provision of Cable Service within the City, Grantee shall provide no
less than $200,128 annually for PEG access operating expenses collectively for
the cities of Edina, Eden Prairie, Hopkins, Minnetonka, and Richfield. After the
first year of the Franchise, Grantee shall provide sufficient financial and in-kind
support to maintain a substantially equivalent level of services, facilities and
equipment in the remaining years of the Franchise Agreement Ordinance
comparable to the services, facilities and equipment provided in the first year of
the Franchise. These expenses will be itemized on customers' bills. This amount
will provide the following services: (a) labor costs; (b) educational consultant;
(c) facilities and utilities; (d) access expenses; (e) educational expenses;
(f) equipment maintenance; (g) technical support; and (h) replay expenses. This
funding shall not be deducted from the Franchise Fee within the meaning of this
Agreement. Grantee shall not calculate a Franchise Fee upon funds itemized on
the customers' bills for public, educational or governmental access production
and programming.
7.4 Regional Channel Six
Under Minnesota Cable Communications Act, standard VHF Channel six has
been designated for usage as the regional channel. Also known as Metro Cable
Network, this independent, noncommercial, nonprofit channel shall be made
available without charge. This provision shall remain in effect as long as a
regional channel is required by the State of Minnesota.
7.5 Override of the Government Access Channel
Grantee agrees to provide the capability such that the City, from its City Hall, can
switch its government Access Channel in the following ways:
A. Insert live Council meetings from City Hall;
B. Replay government access programming from City Hall;
384348/1 7
EXHIBIT B
LIST OF PUBLIC SCHOOLS AND BUILDINGS
PUBLIC SCHOOLS
Concord Elementary
Cornelia Elementary
Countryside Elementary
Creek Valley Elementary
Highlands Elementary
Normandale Elementary
South View Middle School
Valley View Middle School
Edina High School
Edina Community Center
PUBLIC BUILDINGS
5900 Concord Avenue
7000 Cornelia Drive
5701 Benton Avenue
6401 Gleason Road
5505 Doncaster Way
5701 Normandale Road
4725 South View Lane
6750 Valley View Road
6754 Valley View Road
5701 Normandale Road
City Hall
4801 W. 50th Street
Public Works
5146 Eden Avenue
Fire Station #1
6250 Tracy Avenue
Fire Station #2
7335 York Avenue
Southdale Liquor Store
6755 York Avenue
50th Street Liquor Store
3943 W. 50" Street
Vernon Avenue Liquor Store 5013 Vernon Avenue
Aquatic Center
4300 W. 66th Street
Arneson Acres
4711 W. 70th Street
Art Center
4701 W. 64th Street
Braemar Arena
7501 Ikola Way
Braemar Golf Course
6364 John Harris Drive
Braemar Golf Dome
7420 Braemar Blvd.
Fred Richards Golf Course
7640 Parklawn Avenue
Centennial Lakes
7499 France Avenue South
Edinborough Park
7700 York Avenue South
Edina Community Library
4701 W. 50th Street
Southdale Library
7001 York Avenue
Weber Park Shelter
4115 Grimes Avenue
Todd Park Shelter
4429 VanderVork Avenue
Walnut Ridge Park
5801 Londonderry Road
Cornelia School Park
7142 Cornelia Drive
Tupa Historic Park
4918 Eden Avenue
384348/1 B-1
EXHIBIT C
EVEREST MINNESOTA LICENSEE, LLC
INITIAL PROGRAMMING
To be provided ninety (90) days prior to System activation
384348/1 C-1
EXHIBIT D
MINIMUM I -NET PERFORMANCE STANDARDS
Signal Quality
The Institutional Network shall achieve the performance standards listed below, where
applicable for fiber and/or fiber/HFC-based transmissions, under worst-case conditions for
communications occurring between:
Any institution to any institution
Any institution to hub or headend and vice versa
Any institution to any subscriber and vice versa
For Institutional Communications Incorporating HFC Infrastructure
Noise and Distortion Performance — Under worst-case channel loading
(including both analog and digital signals), the combined upstream and
downstream performance of the system shall meet or exceed the
following:
- Carrier to noise ratio = 45 dB or better
- Carrier to composite triple beat = 55 dB or better
- Carrier to second order distortion = 55 dB or better
- Carrier to cross modulation = 55 dB or better
Data Communications — For any data communications link on the
network, the Network shall provide the capability for a Bit Error Rate
(BER) to be equal to or better than 1 x 10 to the minus 9, except where the
link is 50% or more coaxial cable, the BER shall be equal to or better than
1 x 10 to the minus 8. This standard shall be met or exceeded under
Normal Operating Conditions. Outage times shall not be considered for
purposes of determining compliance with the BER prescribed in this
paragraph.
Network Availability — For each user of services on the network, network
availability shall be equal to or better than 99.965% (no more than 184
minutes of network downtime per user) as measured on an annual basis.
Signal Level Variation — The worst-case signal level variation (peak to
valley) shall be better than or equal to N/10 + 2 (where "N" equals the
number of RF amplifiers in cascade from the HFC node).
For End -to -End Fiber -Based Institutional Communications
• Optical System Noise Performance — Under worst-case link loss as
measured for any voice, video or data service, the combined upstream and
384348/1 D-1
downstream performance of the system shall meet or exceed the
following:
Signal to noise equals 60 dB or better for links that utilize Grantee supplied
equipment. For all other links, the network shall be capable of providing a signal
to noise of 60 dB or better, dependent upon end-user equipment.
Qptical Received Power Level at the Institution ❑ For all links that utilize
Grantee -supplied equipment, the optical power level for any service
delivered to the designated demarcation point at each I -Net user location
shall meet or be better than 0 dBm and shall, in all cases, enable operation
within the equipment manufacturer's minimum specifications. For all
other links on the network, I -Net users shall be able to satisfactorily
employ non -custom network transmission and reception equipment, and
the I -Net shall enable operation within the manufacturer's minimum
specifications for such equipment.
Network Availability — For each user on the network, network availability
on the backbone or for fully redundant, diverse path connections from
hubs to user sites, shall be equal to or better than 99.99% (no more than 53
minutes of network downtime per user) as measured on an annual basis.
For each user on the network, network availability for standard
connections from the hub to the user site shall be equal to or better than
99.965% (no more than 184 minutes of network downtime per user) as
measured on annual basis.
For purposes of this Exhibit D, the network shall be defined as "unavailable" under
the standards herein for any given user when such user:
a. Cannot, because of a network problem, measured by SNMP software or other
appropriate software and associated hardware, or through a failure of a Grantee -
provided interconnect, transmit video, voice and/or data communications to, from,
and/or on the network. Such problems shall be the result of a failure of one or
more of the following: 1) the fiber optic cabling, connections and transmission
equipment on the network and/or the coaxial cabling, connections and RF
transmission equipment on the network; 2) the transmission equipment at
Grantee's headend; 3) the transmission and network equipment at the customer's
premise (if such equipment is provided by Grantee); 4) network powering
systems; 5) the network equipment, connections and cabling, network
management, hardware and software, and related equipment provided by Grantee
at Grantee's headend; and/or 6) any other Grantee -provided transmission or
network component; and or,
b. Experiences, due to a network problem, video, voice and data transmissions that
are below the standards set forth in this Franchise and/or this Exhibit; and/or,
384348/1 D-2
c. Experiences, due to a network problem, a data communication packet loss of
greater than ten percent (10%).
For purposes of this availability standard, network problems shall not be defined
as: infrequent scheduled preventative maintenance as long as I -Net users are
notified well in advance, according to the provisions of the Franchise. Except as
otherwise provided for herein, network availability is subject to the force majeure
provisions of the Franchise and those conditions which are not within the control
of the Grantee.
Network downtime shall include, but not be limited to, network failures caused
by: third party actions; commercial power outages of a typical, non -catastrophic
nature; and power failures and other disturbances caused by weather occurrences
typical to the Twin Cities area. Grantee shall comply with the requirements of
Demand Maintenance/Service and Repair to restore service following any of these
occurrences. Grantee will give the City and affected I -Net users notice in the
event of any of the foregoing occurrences.
Data Communications — For any data communications link on the
network, the Bit Error Rate (BER) shall be equal to or better than 1 x 10 to
the minus 9. This standard shall be met or exceeded under Normal
Operating Conditions. Outage times shall not be considered for purposes
of determining compliance with the BER prescribed in this paragraph.
Service Response
Network Maintenance — Grantee shall be responsible for the ongoing maintenance and
performance of the I -Net from the demarcation point within a facility through the network,
including the I -Net headend. Routine and preventive maintenance shall be performed
continually on the network to ensure that it meets all performance criteria detailed herein.
Specific Performance Oversight Responsibilities of the Grantee will include:
(1) Monitoring the operation of the fiber based transport backbone in conjunction
with I -Net users;
(2) Performance and fault monitoring of the transport backbone and distribution
system in accordance with same terms and conditions referenced in Section
8.1(C);
(3) Monitoring of selected parameters and tables to allow for early identification of
potential service problems;
(4) Monitoring and analyzing I -Net performance; and
(5) Logging and reporting, as required, of data gathered from above monitoring
activities.
384348/1 D-3
Preventive Maintenance/Service Interruptions — I -Net users will be notified at least seven days in
advance of any scheduled maintenance that may interrupt service on the I -Net, unless I -Net users
agree to waive such time frame. Where possible, such maintenance will be scheduled at times of
low usage.
Demand Maintenance/Service and Repair — Response to all network problems shall occur at all
hours (24 x 365). Specifically, when Grantee receives a trouble call or alarm, either by internal
monitoring or by City, the Grantee's Network Operations Center will ensure that appropriate
technical support shall respond within 10 minutes after receiving a call related to a network
problem (under Normal Operating Conditions the initial page to the technician on call for I -Net
problems will be within the 10 minute time frame). The Grantee shall then work continuously
until the problem is resolved.
Network Support — Grantee shall provide an appropriate complement of administrative, headend
and field personnel at all times to meet the performance criteria detailed herein.
Service Call Processing and Tracking — Grantee will establish mechanisms and procedures for all
I -Net users to quickly and easily report System problems. All trouble or service calls will be
documented, processed, and completed in an expedient manner.
Documentation will include monthly I -Net service call reports, as required, which will include a
breakdown of reasons and resolutions as well as call handling efficiency. Notwithstanding the
staffing, testing and equipment and response requirements set forth herein, the Grantee will
provide the in-house and/or contractor staff, spare and back-up equipment, test and maintenance
equipment and additional steps necessary to ensure that the network performs reliably in
accordance with all standards detailed herein.
Network Performance Testing
Proof of Performance — Proof of performance testing will be conducted on the I -Net two (2)
times per year at the same time residential subscriber system testing is performed during the
months of January/February and July/August. Several geographically diverse I -Net test point
locations for each ring and an additional test point per node will be established which are
representative of worst-case performance for the area. Testing shall be completed at the
mutually agreed upon entry demarcation point at the institution. All active channels upstream
and downstream shall be tested at each test point location. If the testing will subject such
channels to service interruptions, Grantee will work with Users to schedule the testing so as to
minimize its impact upon the Users. Testing shall be performed to ensure compliance with all
the network performance specifications included in this Appendix and applicable Service
Agreements. Tests shall be performed using standard test methodologies, as mutually agreed to
by the City and Grantee.
Power Supply Inspections — All network power supplies and back-up devices will be
continuously status monitored and manually inspected at least twice per year, which will include
the following checks and tests:
384348/1 D-4
Full load transfer and runtime test
Battery condition and maintenance check, including replacement if
required
Status monitoring functional test
I -Net User Location Performance Testing — All network performance specifications shall be met
at each I -Net user location, and the network shall at all times enable I -Net user video, voice and
data communications to be successfully transmitted in accordance with the reliability and
availability standards incorporated herein. Grantee shall schedule with each user such testing as
required to ensure successful network performance at each I -Net user location.
Physical Network Characteristics — The physical and electrical configuration of the I -Net will
comply with all applicable Federal, State, and Local requirements. Inspections of all cable runs
and components will be made by Grantee during the I -Net construction process to ensure the
integrity of the network and Grantee shall keep records thereof.
Performance Documentation — All tests and checks will be documented and, upon request, filed
with the City. At the City's request, all testing processes may be conducted under the
observation of a representative from the City.
All network performance standards herein relate to Grantee -supplied transmission and network,
facilities, infrastructure, equipment and other components.
384348/1 D-5
EXHIBIT E
I -NET USER SITES
[to include all schools and public buildings located within each member city]
384348/1 E-1
(ii) If the wired competitor passes 25% or more but less than 50% of
the homes and customers in the cities of Edina, Eden Prairie,
Hopkins, Minnetonka and Richfield, the City shall reduce the
funding, and equipment and facilities requirements of the Grantee
by 30%.
(iii) If the wired competitor passes 50% or more of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, the City shall eliminate the funding,
and equipment and facilities requirements for public, educational
and governmental access funding.
It is not the intent of this section to reduce Grantee's funds, equipment and
facilities requirements regarding public, educational and governmental
access programming to an amount less than the amount provided by its
wired competitors. If at any time a wired competitor provides funds,
equipment or facilities for public, educational and governmental access
that exceed the funds, equipment or facilities provided by Grantee under
this paragraph, Grantee shall provide the same amount of funds,
equipment and facilities. In no event shall Grantee be required to provide
more funds, equipment or facilities than it has agreed to provide in
Section 7 of this Franchise Agreement Ordinance.
If the wired competitor discontinues providing multichannel video
services, the Grantee's requirement for the provision of funding and,
equipment and facilities for public, educational and governmental access
and, facilities and equipment shall immediately return to its original level.
D. For all other Franchise provisions imposed upon Grantee in this
Ordinance, if a wired competitor obtains a cable Franchise which does not
require it to meet the same Franchise provision, the City shall not require
Grantee to meet that Franchise provision. If the wired competitor does not
obtain a cable Franchise and it is not required to meet the same Franchise
provision, then the City shall relieve the Grantee from that Franchise
provision as follows:
(i) If the wired competitor passes less than 50% of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, Grantee shall continue to comply with
the Franchise provision.
(ii) If the wired competitor passes 50% or more of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, the City shall not require Grantee to
meet the Franchise provision.
384348/1 23
If at any time a wired competitor provides a requirement contained
originally in this cable Franchise, Grantee shall comply with that same
requirement.
If the wired competitor discontinues providing multichannel video
services, the Grantee shall be required to meet the Franchise provision.
13.5 If Grantee is aware of a Franchise provision imposed by the City upon Grantee
which is not also imposed by the City or the State of Minnesota upon a wired
competitor, it shall identify the wired competitor, including the basis for stating
that the entity is a "wired competitor" as defined above; it shall identify the
Franchise provision in question; and it shall provide this information to the City.
Within 90 days, the City shall: (1) pass a resolution declaring that Grantee is
subject to this section for that requirement; (2) declare why the entity in question
is not a wired competitor; or (3) state that the "wired competitor" is subject to a
requirement that substantially duplicates the Franchise provision. During the
above process, the Grantee shall escrow any funds at issue in the above process
that the Franchise requires be remitted during the time period of the above process
and Grantee shall continue to meet any and all requirements in question. If the
City declares such requirement void as to Grantee, the City is not liable for
Grantee's past compliance with the requirement, including any past fees remitted
to the City.
13.6 If the City and Grantee are unable to agree upon the operation of this section of
the Ordinance within 90 days after one party provides notice to the other party,
the parties may agree to enter mediation.
SECTION 14. ACCEPTANCE
14.1 Other Franchises
A. The System intended for City, may be part of a joint system that serves the
cities of Eden Prairie, Edina, Hopkins, Minnetonka and Richfield,
Minnesota.
B. Grantee will, in good faith, apply for and accept, if offered 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.
14.2 Time of Acceptance; Incorporation of Offering; Exhibits
A. Grantee shall accept this Franchise in form and substance acceptable to
City by Such acceptance by Grantee shall
be deemed the grant of this Franchise for all purposes.
384348/1 24
B. Upon acceptance of this Franchise, Grantee shall be bound by all the terms
and conditions contained in Ordinance No. , also known as the
Cable Television Regulatory Ordinance, and herein. With its acceptance,
Grantee also shall obtain an opinion from its legal counsel, acceptable to
City, stating that this Franchise has been duly accepted by Grantee, that
this Franchise is enforceable against Grantee in accordance with its terms,
and which opinion shall otherwise be in form and substance acceptable to
City.
C. 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.
D. Ninety (90) days prior to the commencement of the operation of the
System, Grantee shall provide a copy of its initial services which shall be
attached hereto as Exhibit C.
E. The effective date of this Franchise Agreement Ordinance shall be
IN WITNESS WHEREOF, Grantor and Grantee have executed this Franchise Agreement the
date and year first above written.
ATTEST:
City Clerk
(SEAL)
(Corporate Seal)
384348/1 25
CITY OF EDINA, MINNESOTA
By
Its:
EVEREST MINNESOTA LICENSEE, LLC
By
Its:
STATE OF MINNESOTA )
ss:
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me on by _
the of the City of Edina, Minnesota, on behalf
of the City.
Notary Public
STATE OF
ss:
COUNTY OF
The foregoing instrument was acknowledged before me on
, the
Minnesota Licensee, LLC, on behalf of the company.
Notary Public
384348/1 26
by
of Everest
EXHIBIT A
FRANCHISE FEE PAYMENT WORKSHEET
TOTAL REVENUE 0 1
LESS: Local Access 0
LESS: Bad Debt 0
CHARGEABLE REVENUE 0
X FRANCHISE FEE % 0
TOTAL FRANCHISE
FEES TO BE PAID $0
384348/1 A-1
Percentages Based on
Revenue & Bad
Total _
Revenue
Debt
Quarter
Quarter
Quarter
Quarter
Payment
Basic
0
Eden Prairie
0%
$0
$0
$0
$0
$0
Additional Outlets
0
Edina
0%
0
0
0
0
0
Equipment Rent
0
Hopkins
0%
0
0
0
0
0
Pay TV
0
Minnetonka
0%
0
0
0
0
0
Pay Per Event
0
Richfield
0%
0
0
0
0
0
Transaction Fee
0
Advertising
0
TOTAL
0%
$0
$0
$0
$0
$0
Shopping Service
0
Other
0
TOTAL REVENUE 0 1
LESS: Local Access 0
LESS: Bad Debt 0
CHARGEABLE REVENUE 0
X FRANCHISE FEE % 0
TOTAL FRANCHISE
FEES TO BE PAID $0
384348/1 A-1
C. Transmit character generated programming;
D. Schedule for Grantee to replay City -provided tapes in pre -arranged time
slot on the government Access Channel; and
E. Switch to C -SPAN 2 or other comparable programming provided by
Grantee at any time when not carrying live or taped government access
programming.
SECTION 8. INSTITUTIONAL NETWORK
8.1 Institutional Network Facilities and Capacity; Cost Recovery by Grantee.
A. The Grantee shall construct an institutional network which at the outset, consists
of the following infrastructure: (i) bi-directional minimum six (6) count fiber
optic lines in a ring and/or a star architecture to the locations within the franchise
area as listed in Exhibit E ("I -Net User Sites") as designated as primary sites by
the City, (ii) bi-directional fiber optic lines in a star architecture from certain
primary sites to certain secondary sites, as designated by the City and in a
minimum quantity consisting of a four (4) count fiber per site and (iii) a minimum
of a two (2) count HFC network per node to certain other secondary sites, as
designated by the City. Within the first twelve (12) months from the effective
date of this franchise, Grantee shall provide the City, or its designee, with a
complete, detailed design and cost estimate for the I -Net infrastructure described
above. Within ninety (90) days thereafter, the City, or its designee, shall work
with I -Net users to review the design and cost estimate, and provide changes to
the Grantee for incorporation into the final I -Net design. Final architecture, site
designation, fiber count of (i), (ii), (iii) subject to City or designee approval.
Grantee shall not begin construction of the System prior to completion of the final
I -Net design. Notwithstanding the timings indicated above, Grantee shall ensure
that sufficient I -Net infrastructure is included incrementally within all necessary
portions of its residential subscriber cable system construction, so that the I -Net
can be achieved at the lowest possible cost to I -Net Users. Once final approval is
received from the City, the Grantee shall complete I -Net construction within
twenty-one (21) months from the effective date of this franchise. Some portions
of the I -Net will be activated prior to final completion. The institutional network
shall have the infrastructure (and, where noted, the equipment) that provides the
capability to transmit any and all signals between the sites listed in Exhibit E.
B. I -Net Users may not sell or resell services or capacity to any third party.
However, I -Net Users may provide services to themselves, including those which
the Grantee otherwise sells to others (for example, an institution may provide
Internet service to itself or to other institutions that the Grantee sells to others).
The limitations of this paragraph shall not prevent the City, or its designee, from
subleasing, bartering, selling, reselling or giving away capacity on the
Institutional Network to any other public or nonprofit entity for noncommercial
384348/1 8
purposes that do not directly compete with any products or services offered by the
Grantee.
C. The City or the institutions listed on Exhibit E ("I -Net Users") shall be
responsible for reimbursing Grantee for its Actual Cost of constructing and
maintaining all portions of the I -Net required by this Section 8. The institutions
listed in Exhibit E (the "I -Net Users") shall not be charged by the Grantee for
usage of the Institutional Network. The City or other I -Net users may elect to pay
the Actual Cost of the I -Net on a monthly basis, appropriately amortized over the
life of the franchise. The terms and conditions of such payment option will be
reflected in an I -Net service agreement to be developed prior to construction of
the I -Net. Such terms and conditions must be in accordance with the other
provisions of this section and associated exhibits. If future I -Net sites are
identified and activated under Section 8.3 below, Grantee shall submit an invoice
for those construction costs in a manner similar to submission of the initial
construction costs of the I -Net.
D. "Actual Cost", as used in this section, means the incremental cost to the Grantee
of materials and capitalized labor necessary to install and construct fiber optic
lines, coaxial cable, and/or equipment together with any permitted return on
investment authorized by the FCC.
E. Except as provided in this Section 8, I -Net Users connected to the I -Net via fiber
or HFC shall be responsible for any end-user or interface equipment needed for
transmission or reception of signals. However, Grantee shall provide at no
charge, upon request and at the time necessary for use, modulators and associated
fiber optic signal transmission and reception equipment for single channel return
purposes for each public and private accredited educational institution and city
hall, as approved by the City or its designee. With respect to non -video end-user
equipment, upon request by a designated institution, Grantee must either lease the
equipment requested to the requesting institution or make reasonable efforts to
arrange for the lease of such equipment. Within 30 days of a written request,
Grantee must notify the requesting institution in writing of its ability or inability
to lease the requested equipment and the terms of such lease. If requested by City,
Grantee shall serve as purchasing agent for City allowing City the benefit of
Grantee's purchasing power and Grantee shall at all times provide City with any
requested assistance regarding the appropriate type of equipment. City, its
designee, or the requesting institution may, however, purchase or lease the
equipment from any vendor.
F. All I -Net Users shall be connected via fiber optic lines or a combination of fiber
optics and coaxial cable as determined by the City to a hub located within the
System. The I -Net architecture shall facilitate transmission of all required signals
within City boundaries, transmission of signals beyond City boundaries within the
franchise area, and transmission of signals to other networks in the Twin Cities
384348/1 9
area. The Grantee shall provide and install all equipment and infrastructure
necessary, which is reimbursable to Grantee under same terms and conditions set
forth in Section 8.1(C), to achieve the required level of interconnection with other
Twin Cities area I -Nets provided by Grantee. Specifically, this includes, but is
not limited to, interconnecting the I -Net with I -Nets that have been or may be
constructed in adjacent systems. Grantee shall also work with the City to
establish interconnects with the Connecting Minnesota Network.
G. I -Net equipment at the hub(s) shall be connected to a gas powered generator
capable of providing continuous electrical power, or equivalent, and to an
uninterruptible power supply that both conditions commercial power and provides
for zero transfer time between normal commercial power and hub back-up
generators.
8.2 Hybrid Fiber -Coaxial Portions of the Institutional Network.
A. The hybrid fiber -coaxial ("HFC") portion of the I -Net shall provide 450 MHZ of
activated capacity (5-42 MHZ for upstream channels and 54-450 MHZ for
downstream channels) to the HFC I -Net Sites. The HFC I -Net shall have fiber
introduced into it to limit amplifier cascades to no more than five (5).
B. All I -Net distribution system power supplies shall have the standby capability of
providing at least three (3) hours of backup power and shall have status
monitoring installed in them. Prior to battery failure, the Grantee shall connect I -
Net Node power supplies to portable generators capable of producing adequate
electrical current until commercial power is restored.
8.3 Future Fiber to the Institution Requirements.
A. The City, or its designee, may identify certain I -Net sites that will not be activated
at the time the initial I -Net is activated. So long as such sites are located on the I -
Net User Sites List, Grantee agrees to include splice points and splice point
housings on those portions of the system where additional fiber will need to be
deployed or additional connections will need to be made. Upon notification from
the City, the Grantee will provide cost estimates within ninety (90) days of a
request by the Grantor for I -Net extension to the additional sites.
B. The City, or its designee, may also identify sites following completion and
activation of the I -Net. Estimated costs for serving those sites will be provided
within ninety (90) days of notification by the City. If an extension of the I -Net is
required to serve the site, Grantee will make the I -Net available within one
hundred twenty (120) days from the initial request. The fiber-optic lines required
by Section 8 shall be passively terminated to standard connectors at the patch
panel of the telephone equipment room of each site or at another designated
location.
384348/1 10
8.4 Grantee's Use of I -Net Capacity.
The I -Net shall be for the exclusive use of the City and I -Net Users throughout the term
of the Franchise, or any renewal or extension thereof. Notwithstanding the foregoing, the
Grantee may use capacity on the I -Net, including for lease or other commercial purposes,
provided that the City and I -Net Users are not using such capacity and further provided
that the Grantee's use does not interfere with use of the I -Net by the City or I -Net Users.
Upon receiving oral or written notice from the City, the Grantee or a lessee shall
immediately cease using the I -Net for any purpose that the City, in its sole discretion,
determines is interfering with I -Net Users' communications. The Grantee or a lessee may
appeal any determination of City concerning I -Net interference to the City within ten (10)
days of the date that the requisite notice is received by the Grantee. Any such appeal
shall: (i) be in writing; (ii) list the reasons that the City's determination regarding
interference with I -Net Users' communications is incorrect; and (iii) include any other
information the Grantee or a Lessee wishes the City to consider. Within forty-five (45)
calendar days of receiving a written appeal under this paragraph, the City shall: (i)
determine whether the City's conclusion that the Grantee or lessee was interfering with I -
Net Users' communications was justified; and (ii) inform the Grantee or lessee in writing
of its findings. This provision shall not limit any other appeal rights of Grantee. Use of
the I -Net by the City and I -Net Users shall, at all times, have priority over any use(s) by
the Grantee or any lessee. The Grantee or a lessee shall terminate its use of any channel
capacity on the I -Net within six (6) months after receiving notice from the City that the
City or any I -Net User has determined to use such capacity. Any agreement entered into
by the Grantee and a third party for the lease of I -Net capacity shall be subject to the
terms and conditions of this Franchise.
8.5 I -Net Performance Standards.
A. The Grantee shall maintain the I -Net in accordance with technical and
performance standards set forth in Exhibit D (Minimum I -Net Performance
Standards). The Grantee shall provide the City, or its designee, upon request,
with reports of the performance of the I -Net and the Grantee's compliance with
the aforementioned technical and performance standards.
B. If at any time, the performance of the I -Net is not in compliance with pertinent
technical and performance standards, and continues to be in non-compliance for a
period of fifteen (15) days after notice and opportunity to correct is given to
Grantee, then affected City or other I -Net Users may cease payment until the non-
compliance situation is resolved.
C. City or I -Net Users may ultimately terminate their use of and payment for I -Net
infrastructure based on repeated, demonstrated non-performance or non-
compliance by Grantee with the terms of this Section 8 and the associated
Exhibits, after giving Grantee notice and opportunity to correct the problem
causing non-performance or non-compliance. Grantee will also be liable for all
other applicable non-compliance penalties contained in the Franchise.
384348/1 11
8.6 Completion of the Institutional Network.
A. Construction of the Institutional Network pursuant to this Section 8 shall be
deemed completed upon satisfaction of the following:
B. The Grantee shall notify the City, or its designee, in writing at least ten (10) days
in advance of completion of construction of each I -Net Node, I -Net site on the
ring, I -Net star connection, and HFC end -of -line. The notice shall include the
date the Grantee is prepared to conduct an OTDR test at 1550 nm and 1310 nm
end-to-end, RF noise, distortion and peak -to -valley tests according to FCC rules,
NCTA Recommended Practices and other acceptable test methodologies and
other applicable tests. The City, or its designee, shall have the option of attending
any test conducted pursuant to this paragraph. All tests must be successfully
completed. The fiber optic test shall be deemed successfully completed if the
optical performance standards in Exhibit D are met or bettered. The coaxial tests
shall also be deemed successfully completed if the specifications detailed in
Exhibit D are met or exceeded.
C. The City, or its designee, shall also have the option of conducting a physical
inspection of the construction and connections to each I -Net site and each I -Net
Node. This inspection shall be conducted no later than the date of the test in
Paragraph A.
D. After completing installation to each I -Net site or each I -Net Node, the Grantee
shall provide the following documentation to the City, or its designee,: splice
locations, panel numbers, cable numbering schemes, location of splitters, location
of all RF actives and passives, OTDR, other optical, RF and coaxial test results
and documentation, and any other pertinent documentation.
8.7 Institutional Network Security.
The Grantee and the City shall at all times use reasonable efforts to protect the security of
the Institutional Network. For purposes of this paragraph, "to protect security" means to
protect those physical elements of the Institutional Network under the party's direct
control from unauthorized intrusion, signal theft, tampering, wiretapping or other actions
that might: (i) compromise the integrity of or degrade the signals carried over the
Institutional Network; or (ii) result in the unauthorized interception and disclosure of
information. Grantee's hub site shall be made available, upon request, for placement and
operation of end user supplied equipment.
8.8 Institutional Network Repair and Maintenance.
A. The Grantee shall maintain, repair, reconstruct and, as necessary, replace the fiber
optic or HFC portions of the I -Net and shall recover the Actual Cost for such
activities from the City and I -Net Users, as set forth in Section 8.1.
384348/1 12
B. The Grantee shall maintain, repair, reconstruct, and, as necessary, replace portions
of the Institutional Network plant, as described in subsection (i) and (ii) below,
during the term of this Franchise or any extension thereof:
Preventative and routine maintenance of the I -Net shall be performed in
the same timeframe and in the same fashion as routine and preventative
maintenance are performed for the Grantee's subscriber network. Actual
or potential problems discovered during the course of preventative and
routine maintenance shall be immediately reported to the City. After
informing the City of an actual or potential problem, the Grantee shall,
within a reasonable period of time, prepare and transmit a report to the
City describing the corrective action, if any, that was or will be taken.
2. Within sixty (60) minutes of receiving notice or otherwise learning of a
maintenance or repair problem, the Grantee's technicians shall begin
actively working on the problem. The Grantee shall work on the problem
continuously until it is resolved. Notwithstanding the above, the Grantee
shall meet the network availability standard described in Exhibit D for
each site on the I -Net.
8.9 Institutional Network Ownership.
The I -Net is a dedicated transmission path owned and maintained by the Grantee and
governed by this Agreement. The obligations for provision of the I -Net will convey to all
successors and assigns. If at any time, the I -Net is considered abandoned as such is
defined in this Franchise, ownership shall convey to the City at the City's discretion. The
City and the sites to which infrastructure is provided via the I -Net will use the I -Net in
accordance with the limitations of this Franchise.
8.10 In lieu of the design options described in Sections 8.1(A) and 8.2(A), the Grantee may
provide an institutional network in compliance with this Section 8.10 as follows:
A. A minimum of one pair (two (2) dark fibers) of single -mode fiber optic cable to
each of the buildings in Exhibit E that the City will designate for the receipt of
such infrastructure, and broadband data -over -cable connections to the buildings
listed in Exhibit E that the City will designate for the receipt of data -over -cable
services. The City may designate certain sites to receive an additional or two
additional pairs of fiber (for a total of 4 or 6 fibers) for which the City or pertinent
I -Net User, as determined by the City, shall pay the incremental cost.
Specifically, the I -Net shall be of a Star, Ring or point-to-point configuration
extending along pathways from the I -Net hub(s) to the I -Net User Sites, as
determined by the City, serving public buildings, including, but not limited to, the
municipal buildings, K-12 public and private non-profit schools, college(s) and
library(s) listed in Exhibit E. Additionally, the City may subsequently designate
new facilities or locations to be connected to the I -Net.
384348/1 13
B. Concerning the broadband data -over -cable HFC connections, Grantee shall
provide such connections to the facilities in Exhibit E as determined by the City.
The broadband data -over -cable HFC connections may be enabled by a separate
part of the residential subscriber cable system upstream and downstream
spectrum, as determined by the City. Grantee shall provide all necessary Cable
Modem Termination System (CMTS) equipment, routers, switches, translators,
hardware, software and other network components, such that each broadband
data -over -cable system connection provides an aggregate data rate of at least three
(3) MBPS in a downstream direction and an aggregate data rate of at least three
(3) MBPS in an upstream direction at each site connected. The broadband data -
over -cable system shall also enable the City, School District and other I -Net User
organization locations to develop separate Virtual Private Networks (VPNS) that
shall connect back to the respective City, School District or other organization's
data center. Each broadband data -over -cable system connection shall also enable
multiple IP addresses and MAC addresses to be facilitated at each site. Grantee
shall provide the number of cable modems required by the I -Net user at each HFC
location. Grantee shall monitor the bandwidth usage of its data network to ensure
available bandwidth for residential customers and I -Net Users. When I -Net Users
cannot achieve the minimum rates specified above at least 90% of the time, or
otherwise do not have sufficient bandwidth to support their data communications
requirements (as determined by the I -Net User), the Grantee's engineering team
will determine from where the traffic is originating, what kind of traffic is being
transmitted and the best approach to add capacity. Upon approval of the approach
by the City, additional capacity shall then be added to the network which may
include provision of a separate bandwidth upstream and downstream for the I -Net
users that would enable I -Net Users to achieve at least the minimum data rates
specified above. A schedule will be generated to add capacity to the network;
and, the additional capacity shall be completed and made available within 90 days
from an I -Net User request.
C. The City may identify HFC I -Net sites following completion and activation of the
I -Net. Estimated cost for serving those sites will be provided within ninety (90)
days of notification by the City. If an extension of the HFC system is required to
serve the site, Grantee will make the I -Net available within one hundred twenty
(120) days from the initial request.
D. The data -over -cable system connections shall be installed complete with all
necessary DOC SIS -compliant (latest version) cable modems at pre -determined
demarcation points chosen by the I -Net User. As part of the standard installation,
coaxial cable shall be run to each designated building to the demarcation points.
8.11 Design
Within the first twelve (12) months from the effective date of this Franchise, Grantee
shall provide the City, or its designee, with a complete detailed design and cost estimate
for the I -Net infrastructure described above. Within ninety (90) days thereafter, the City,
384348/1 14
or its designee, shall work with I -Net Users to review the design and cost estimate, and
provide changes to the Grantee for incorporation into the final I -Net design. Final
architecture, site designation and fiber count are subject to City or designee approval.
Notwithstanding the timings indicated above, Grantee shall ensure that sufficient I -Net
infrastructure is included incrementally within all necessary portions of its residential
subscriber cable system construction, so that the I -Net can be achieved at the lowest
possible cost to I -Net Users. Once final approval is received from the City, the Grantee
shall complete I -Net construction within twenty-one (21) months from the effective date
of this Franchise. Some portions of the I -Net will be activated prior to final completion.
The Institutional Network shall have the infrastructure (and, where noted, the equipment)
that provides the capability to transmit any and all signals between the sites listed in
Exhibit E.
SECTION 9. PERIODIC CUSTOMER SURVEYS
9.1 The Grantee shall, upon request of the City and at times mutually agreed upon by
the parties, but no more frequently than once every three years, conduct a random
survey of a representative sample of Subscribers. Each questionnaire shall be
prepared and conducted in good faith so as to provide reasonably reliable measure
of customer satisfaction with: (1) audio and signal quality; (2) response to
customer complaints; (3) billing practices; (4) programming; and (5) Installation
practices;
9.2 The survey shall be conducted in conformity with standard research procedures,
including the use of telephone survey conducted by an independent person in the
business of regularly conducting such surveys. The survey shall consist of a
sample size of 300 customers or such other sample size as to yield a margin of
error of plus or minus six percent or less of the total customer base.
9.3 The Grantee shall report the results of the survey and any steps the Grantee may
be taking in response to the survey within 60 days of the completion of the
survey.
9.4 Notwithstanding anything to the contrary, the Grantee shall be under no
obligation to conduct a survey at any time the Grantee is deemed subject to
effective competition under then applicable state or federal law.
SECTION 10. LINE EXTENSION POLICY
10.1 The Grantee shall, within 12 months of receiving a request, extend the System to
any residences within the City served by City water and sewer facilities.
10.2 The City recognizes that in some instances the Grantee needs the permission of
private property owners to extend service to others who may be interested in
service and agrees that should the Grantee be unable to obtain these needed
permissions under terms reasonable to the Grantee and the property owners from
384348/1 15
whom permission is required that the Grantee shall be under no obligation to
extend service.
SECTION 11. GENERAL FINANCIAL AND INSURANCE PROVISIONS
11.1 Payment to City
A. Grantee shall pay to the City a Franchise Fee in an amount equal to five
percent (5%) of its annual Gross Revenues.
B. The foregoing payment shall be compensation for use of Streets.
C. Payments due the City under this provision shall be computed at the end
of each calendar quarter. Payments shall be due and payable for each
quarter not later than 60 days from the last day of the quarter. Each
payment shall be accompanied by a brief report showing the basis for the
computation. At the end of each calendar year, Grantee shall complete a
Franchise Fee Payment Worksheet attached hereto as Exhibit A. Grantee
shall file a completed Franchise Fee Payment Worksheet no later than 60
days after the last day of the calendar year.
D. No acceptance of any payment shall be construed as an accord that the
amount paid is in fact the correct amount, nor shall such acceptance of
payment be construed as a release of any claim the City may have for
further or additional sums payable under the provisions of this Franchise.
All amounts paid shall be subject to audit and recomputation by the City.
E. In the event any payment is not made on the due date, interest on the
amount due shall accrue from such date at the annual rate of 12%.
11.2 Bonds
A. Prior to the commencement of System construction, and at all times
thereafter until Grantee has completed the construction of the System in
Section 6.1 of this Franchise, Grantee shall maintain with City a bond in
the sum of $300,000.00 in such form and with such sureties as shall be
acceptable to City, conditioned upon the faithful performance by Grantee
of this Franchise and the acceptance hereof given by City 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 percent in excess of the then prime rate), up to the full
amount of the bond, and which bond shall further guarantee payment by
384348/1 16
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. Upon completion of the System as
described in Section 6.1 of this Franchise, the City may reduce the bond to
the sum of $100,000.
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.
11.3 Security Fund
A. In the event the Grantee is given notice of a noncompliance pursuant to
Section 34 of the Ordinance, the Grantee shall within ten (10) days thereof
deposit into a bank account, established by the City, and maintain on
deposit the sum of Twenty Thousand and 00/100 Dollars ($20,000.00) or
deliver to the City a letter of credit in the same amount as a common
Security Fund for the faithful performance by it of all the provisions of
this Franchise and compliance with all orders, permits and directions of
the City and the payment by Grantee of any claim, liens, costs, expenses
and taxes due the City which arise by reason of the construction, operation
or maintenance of the System. Interest on this deposit shall be paid to
Grantee by the bank on an annual basis. The security may be terminated
by the Grantee upon the Resolution of the alleged noncompliance. The
obligation to establish the security fund required by this paragraph is
unconditional. The fund must be established whenever Grantee is given
the notice required, even if Grantee disputes the allegation that it is not in
compliance. If Grantee fails to establish the security fund as required, the
City may take whatever action is appropriate to require the establishment
of that fund and may recover its costs, reasonable attorneys' fees, and an
additional penalty of $2000 in that action.
B. Provision shall be made to permit the City to withdraw funds from the
Security Fund. Grantee shall not use the Security Fund for other purposes
and shall not assign, pledge or otherwise use this Security Fund as security
for any purpose.
C. Within ten (10) days after notice to it that any amount has been withdrawn
by the City from the Security Fund pursuant to (A) of this section, Grantee
shall deposit a sum of money sufficient to restore such Security Fund to
the required amount.
D. 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
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Franchise in particular Section 11(G) herein, City in its sole discretion
may charge to and collect from the Security Fund the following penalties:
For failure to complete System construction in accordance with
Section 6.1 hereof, unless City approves the delay, the penalty
shall be $200.00 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 $50.00 per day for each day, or part
thereof, such failure occurs or continues.
3. For failure to comply with any of the provisions of this Franchise
for which a penalty is not otherwise specifically provided pursuant
to this Paragraph C, the penalty shall be $50.00 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 $50.00 per
day for each day, or part thereof, such failure occurs or continues.
5. For failure by Grantee to provide additional services as negotiated
between City and Grantee at a periodic review session within 45
days after a request by City the penalty shall be $200.00 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 $200.00 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 $100.00
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.
E. Exclusive of the contractual penalties set out above in this section, a
violation of any provision of this Franchise is a misdemeanor.
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F. If Grantee fails to pay to the City any taxes due and unpaid; or fails to
repay to the City, any damages, costs or expenses which the City shall be
compelled to pay by reason of any act or default of the Grantee in
connection with this Franchise; or fails, after thirty (30) days' notice of
such failure by the City to comply with any provision of the Franchise
which the City reasonably determines can be remedied by an expenditure
of the security, the City may then withdraw such funds from the Security
Fund. Payments are not Franchise Fees as defined in Section 29 of the
Ordinance.
G. Whenever the City finds that Grantee has allegedly violated one or more
terms, conditions or provisions of this Franchise, a written notice shall be
given to Grantee. The written notice shall describe in reasonable detail the
alleged violation so as to afford Grantee an opportunity to remedy the
violation. Grantee shall have 30 days subsequent to receipt of the notice
in which to correct the violation before the City may require Grantee to
make payment of penalties, and further to enforce payment of penalties
through the Security Fund. Grantee may, within 10 days of receipt of
notice, notify the City that there is a dispute as to whether a violation or
failure has, in fact, occurred. Such notice by Grantee shall specify with
particularity the matters disputed by Grantee and shall stay the running of
the above-described time.
City shall hear Grantee's dispute at the next regularly scheduled or
specially scheduled Council meeting. Grantee shall have the right
to subpoena and cross-examine witnesses. The City shall
determine if Grantee has committed a violation and shall make
written findings of fact relative to its determination. If a violation
is found, Grantee may petition for reconsideration.
2. If, after hearing the dispute, the claim is upheld by the City, then
Grantee shall have 30 days within which to remedy the violation
before the City may require payment of all penalties due it.
3. The time for Grantee to correct any alleged violation may be
extended by the City if the necessary action to correct the alleged
violation is of such a nature or character as to require more than 30
days within which to perform, provided Grantee commences
corrective action within 15 days and thereafter uses reasonable
diligence, as determined by the City, to correct the violation.
H. If City draws upon the Security Fund delivered pursuant hereto, in whole
or in part, Grantee shall replace the same within three days and shall
deliver to City a like replacement Security Fund for the full amount stated
in Paragraph A of this section as a substitution of the previous Security
Fund.
384348/1 19
" i 1 6
I. If any Security Fund is not so replaced, City may draw on said Security
Fund 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 attorneys' fees incurred by the City in so
performing and paying. The failure to so replace any Security Fund may
also, at the option of City, be deemed a default by Grantee under this
Franchise. The drawing on the Security Fund 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.
The collection by City of any damages, monies or penalties from the
Security Fund shall not affect any other right or remedy available to City,
nor shall any act, or failure to act, by City pursuant to the Security Fund,
be deemed a waiver of any right of City pursuant to this Franchise or
otherwise.
SECTION 12. PUBLIC COMMITMENT
Grantee shall provide free service connections, free on-line (i.e. high-speed cable modem
services) services and any required modem to all institutions identified in Exhibit B.
SECTION 13. COMPETITION ADJUSTMENT
13.1 In consideration of Grantee's substantial investment to build its System for the
Cities of Eden Prairie, Edina, Minnetonka, Hopkins and Richfield, Minnesota, the
City agrees to include the following provisions.
13.2 Any additional or subsequent cable Franchise granted to cable or non -cable
companies who may compete with Grantee within the Franchise area will be
granted only on substantially similar terms and conditions as this Franchise and
shall not contain less burdensome nor more favorable terms than those imposed
on Grantee by this Franchise.
13.3 The City and Grantee agree that all Franchise provisions that Grantee is subject to
are effective against the Grantee only if such requirements are applied as well to
any and all wired competitors of the Grantee within the Franchise area. For
purposes of this subsection, a wired competitor is any video provider using Streets
and offering at least 12 channels of video programming at least one of which is a
broadcast signal, which uses wires, coaxial cables, optical fiber or other similar
technology and places or attaches such wires, cables or fibers on Streets or public
utility facilities. This definition of wired competitor does not include a Satellite
384348/1 20
r 1 3
Master Antenna Television system located wholly on private property within a
building.
13.4 Any Franchise provision or other regulation enforced by the City upon Grantee
which is not also imposed upon Grantee(s) wired competitors within the
Franchise area of the City, shall be void as to Grantee, subject to the following
requirements:
A. The existence of a wired competitor in the Franchise area of the City shall
not relieve Grantee of an obligation to provide an annual minimum
Franchise Fee of two percent of Gross Revenues. If the wired competitor
obtains a cable Franchise which requires it to pay a Franchise Fee or
substantially similar fee of an equivalent amount to the City, the State of
Minnesota or any other governmental entity which is less than five percent
of Gross Revenues, the City shall reduce Grantee's Franchise Fee to the
same level, but in no event less than two percent of Gross Revenues. If
the wired competitor does not obtain a cable Franchise, but it is required to
pay a Franchise Fee or substantially similar fee to the City, State of
Minnesota or any other governmental entity, then Grantee shall pay the
same fee, but in no event less than two percent of Gross Revenues. If the
wired competitor is not required to pay a Franchise Fee or similar fee to
the City or the State of Minnesota, then the two percent minimum
Franchise Fee shall apply to Grantee for all homes and customers who are
passed by the wired competitor's system. If at any time a wired
competitor with a cable Franchise pays a Franchise Fee of more than two
percent, or if a wired competitor without a Franchise Fee pays a Franchise
Fee or similar fee of more than two percent, Grantee shall pay the same
Franchise Fee. In no event shall Grantee be required to pay more than a
five percent Franchise Fee. If the wired competitor discontinues providing
multichannel video services, the Grantee's Franchise Fee shall
immediately return to its original level.
B. The existence of a wired competitor shall not relieve Grantee of an
obligation to provide at least one channel for public, educational and
governmental access programming. If the wired competitor obtains a
cable Franchise which requires it to provide less than four public,
educational and governmental Access Channels, the City shall, upon the
effective date of the subsequent Franchise, reduce Grantee's requirement
to the same number of channels, but in no event shall Grantee provide less
than one public, educational and governmental access channel. If the
wired competitor does not obtain a cable Franchise, but it is required to
provide less than four public, educational and governmental Access
Channels, or if the wired competitor is not required to provide any public,
educational or governmental Access Channels, then the City shall reduce
the number of Access Channels required of Grantee as follows:
384348/1 21
(i) If the wired competitor passes less than 25% of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, Grantee shall provide at least four
public, educational and governmental Access Channels.
(ii) If the wired competitor passes 25% or more but less than 50% of
the homes and customers in the cities of Edina, Eden Prairie,
Hopkins, Minnetonka and Richfield, Grantee shall provide at least
three public, educational and governmental Access Channels.
(iii) If the wired competitor passes 50% or more of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, Grantee shall provide at least one
public, educational and governmental Access Channel.
If at any time, a wired competitor provides channels for public,
educational and governmental access which exceed the channels provided
by Grantee, Grantee shall provide the same number of channels as the
wired competitor. In no event shall Grantee be required to provide more
public, educational or governmental Access Channels than it has agreed to
in this Franchise Agreement Ordinance.
If the wired competitor discontinues providing multichannel video
services, the Grantee's requirement for the provision of public,
educational and governmental Access Channels shall immediately return
to its original level.
C. If a wired competitor obtains a cable Franchise which requires it to
provide less funding for equipment or facilities for public, educational and
governmental access or less facilities and equipment than Grantee, the
City shall reduce the Grantee's requirement for funding for public,
educational and governmental access and facilities and equipment to the
level of the wired competitor. If the wired competitor does not obtain a
cable Franchise, including open video providers in accordance with the
Telecommunications Act of 1996 and FCC rules, but it is required to
provide less funding for public, educational and governmental access or
less equipment or facilities than Grantee, or if the wired competitor is not
required to provide any funding for public, educational or governmental
access or equipment or facilities, then the City shall reduce the Grantee's
required funding as follows:
(i) If the wired competitor passes less than 25% of the homes and
customers in the cities of Edina, Eden Prairie, Hopkins,
Minnetonka and Richfield, Grantee shall continue to provide the
same level of funding for public, educational and governmental
access facilities and equipment as indicated in this Ordinance.
384348/1 22