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HomeMy WebLinkAboutOrd 1176-1996ORDINANCE NO. 1176-96 CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA A ORDINANCE RELATED TO THE GRANTING OF A CABLE TELEVISION FRANCHISE AGREEMENT TO WESTERN TV CABLE, A SUBSIDIARY OF THE CHRONICLE PUBLISHING COMPANY. WHEREAS, pursuant to South San Francisco Municipal Code Section 6.76.050, the City Council is authorized to award a cable television franchise; WHEREAS, the City of South San Francisco and Western Cable TV desire to enter into the Franchise Agreement attached hereto; NOW, THEREFORE, the City Council of the City of South San Francisco does ordain as follows: SECTION 1. The City Council hereby approves the Cable Television Franchise Agreement attached hereto as Exhibit 1 and incorporated herein by reference. SECTION 2. SEVERABILITY In the event any section or portion of this Ordinance shall be determined invalid or unconstitutional, such section or portion shall be deemed severable and all other sections or portions hereof shall remain in full force and effect. SECTION 3. PUBLICATION AND EFFECTIVE DATE Pursuant to the provision of Government Code §36933, a Summary of this Ordinance shall be prepared by the City Attorney. At least five (5) days prior to the Council Meeting at which this Ordinance is scheduled to be adopted, the City Clerk shall (1) publish the Summary and (2) post in the City Clerk's office a certified copy of this Ordinance. Within fifteen (15) days after the adoption of this Ordinance, the City Clerk shall (1) publish the Summary and (2) post in the City Clerk's office a certified copy of the full text of this Ordinance along with the names of those City Councilmembers voting for or against this Ordinance or otherwise voting. ! I! C~E~NTRAL RE~CORD~ ' Introduced at a regul ar South San Francisco held the 13th meeting of the City Council of the City of day of December , 1995. Adopted as an Ordinance of the City of South San Francisco at a rog,, 1 a r meeting of the City Council of the City of South San Francisco, held the 10th day of danuary , 1996 by the following vote: AYES: C.n~Jnnilmomhorq ,lnqoph A_ Fornokoq, Fugono R. Mulli.n, ,lnhn R. Penna, Robert Yee and Mayor Jack Drago NOES: None ABSTAIN: None ABSENT: None City Clerk As Mayor of the City of South San Francisco, I do hereby approve the foregoing Ordinance this 1 {)th day of 3an,Jary , 1996. A:\CABLE.ORD 2 EXHIBIT 1 TO ORDINANCE NO. 1176-96 CABLE TELEVISION FRANCHISE AGREEMENT BETWEEN THE CITY OF SOUTH SAN FRANCISCO AND WESTERN TV CABLE EFFECTIVE: January 1, 1996 145666.2- 120595 Exhibit 1 II ! I ! SECTION 1. SECTION 2. SECTION 3. SECTION 4. SECTION 5. SECTION 6. EXHIBITS A: B: C: D: TABLE OF CONTENTS Page RENEWAL OF FRANCHISE ............. 2 GENERAL REQUIREMENTS ............. 5 SYSTEM UPGRADE ................ 14 SERVICES AND PROGRAMMING ........... 18 SUPPORT FOR LOCAL CABLE USAGE ........ 19 REGULATION .................. 21 OWNERSHIP SURETY GUARANTEE (SAMPLE) GRANTEE COMMITMENT TO EG ACCESS FACILITIES AND EQUIPMENT SERVICE TO PUBLIC FACILITIES 145666.2 -- 120595 [] ! ! AGREEMENT ThiS Agreement, made and entered into this 1st day of January, 1996, at South San Francisco, California, by and between the City of South San Francisco, a municipal corporation of the State of California, and Western TV Cable, a subsidiary of The Chronicle Publishing Company. WITNESSETH WHEREAS, the City of South San Francisco, pursuant to Ordinance No. 1175-95, is authorized to grant and renew one or more non-exclusive revocable franchises to operate, construct, maintain and reconstruct a cable television system within the City; and WHEREAS, the City, after due evaluation of Western TV Cable, a subsidiary of The Chronicle Publishing Company, and after public hearings, has determined that it is in the best interests of the City and its residents to renew its franchise with Western TV Cable. NOW, THEREFORE, the City of South San Francisco (hereinafter the "Grantor") hereby grants to Western TV Cable (hereinafter the "Grantee") a renewal of its cable television franchise in accordance with the provisions of Ordinance No. 1175-95 and this Agreement. 145666,2- 120595 1 SECTION 1. RENEWAL OF FRANCHISE 1.1 Grant The cable television franchise granted effective October 1, 1980 to Western TV Cable. a corporation whose current ownership is indicated in Exhibit "A", is hereby renewed, subject to the terms and conditions of this Agreement. The renewal extends the franchise, authority, right and privilege, to construct, reconstruct, operate and maintain a cable television and communications system within the streets and public ways in the City of South San Francisco as it is now or may in the future be constituted. 1.2Riqht of Grantor to Issue and Renew Franchise Grantee acknowledges and accepts the present right of Grantor to issue and/or renew a franchise and Grantee agrees it shall not now or at any time hereafter challenge any lawful exercise of this right in any local, State or Federal court. This is not, however, a waiver of any constitutional or legal right or privilege on the part of the Grantee. 1.3 Effective Date of Renewal The renewal shall be effective on the date that both parties have executed this Agreement, provided that said date is no later than thirty (30) days after the date the City Council, by Ordinance, approves this Agreement. The renewal is further contingent upon the filing by Grantee with the City Clerk, of the executed Franchise Agreement and the required security fund and insurance certificates, except that if the filing of the security 145666.2- 120595 2 I1 I I [ fund or any such insurance certificate does not occur within sixty (60) days after the effective date of the Ordinance approving renewal and any extension of time hereunder, the Grantor may declare this renewal null and void. 1.4 Duration The term of the renewal shall be twelve (12) years from the effective date hereof, at which time it shall expire and be of no force and effect unless renewed; provided that if the Section 3.1 system upgrade is completed in thirty (30) months, the franchise term shall be further extended by 3 years, and if completed within twenty-four (24) months, the term shall be extended an additional 2 years. Renewal shall be in accordance with applicable law. 1.5 Conflict with Cable Ordinance The provisions of the city of South San Francisco Cable Television Regulatory Ordinance, Ordinance No. 1175-95 are hereby incorporated herein by reference as if set out in full, and form part of the terms and conditions of this Agreement. In the event of any conflict between the terms and conditions of this Agreement and the provisions of Ordinance No. 1175-95, this Agreement shall prevail. Should Ordinance No. 1175-95 be amended, revised, superseded or otherwise changed after the effective date hereof in such a way as would materially affect the terms and conditions of this Agreement, said amendment, revision or change shall not apply to this Agreement without Grantee's approval. 145666.2- 120595 3 1.6 Definitions The definitions contained in Ordinance No. 1175-95 are incorporated herein as if fully set forth. SECTION 2. GENERAL REOUIREMENTS 2.1 Governing Requirements Grantee shall comply with all lawful requirements of this Agreement, Ordinance No. 1175-95 and applicable State and Federal law. 2.2 Franchise Fee The Grantee shall pay to the Grantor an annual franchise fee of two and one-half percent (2.5%) of Gross Annual Revenues received by Grantee from operation of the cable system in the City of South San Francisco. The fee shall be payable quarterly by April 30, July 31, October 31 and January 31 for the preceding three (3) month periods. 2.3 Recovery of Processing Costs As provided in Section 6.76.150 of Ordinance No. 1175-95, Grantee, within sixty (60) days after receipt from Grantor of a written itemization, shall reimburse Grantor for its actual, reasonable out-of-pocket costs incurred during the franchise renewal process, not to exceed Twenty-Five Thousand Dollars ($25,000). 2.4 Resolution of Disputes To aid in the analysis and resolution of any future disputed matters relative to the franchise, the Grantor and Grantee may, by mutual agreement (both as to whether to hire and 145666.2- 121495 4 whom to hire), employ the services of technical, financial or legal consultants, as mediators. All reasonable fees of the consultants incurred by the Grantor and/or the Grantee in this regard shall be borne by the party that loses the dispute, in the judgment of the employed consultants. 2.5 Payment to Grantor No acceptance of any payment shall be construed as an accord that the amount is in fact the correct amount, nor shall such acceptance of payment be construed as a release of any claim the Grantor may have for further or additional sums payable under the provision of this Agreement. All amounts shall be subject to audit, as authorized by Section 6.76.180 of Ordinance No. 1175- 95. 2.6 Liability Insurance (a) Upon the effective date of renewal the Grantee shall, at its sole expense, take out, and maintain during the life of this Agreement and furnish to the Grantor, a policy of insurance as required by the State of California for Worker's Compensation, and a policy of liability insurance that shall conform to the provisions of Section 6.76.230 of Ordinance No. 1175-95. The amounts of insurance shall not be less than the following: Single Limit Coverage applying to Bodily and Personal Injury and Property Damage: One Million ($1,000,000) 145666.2- 120595 5 The following endorsements shall be attached to the liability policy: (1) The policy shall cover on an "occurrence" basis. (2) The policy shall cover Personal Injury as well as Bodily Injury. (3) The policy shall cover blanket contractual liability subject to the standard universal exclusions of contractual liability included in the carrier's standard endorsement as to bodily injuries, personal injuries and property damage. (4) Broad Form property damage liability shall be afforded. (5) The Grantor shall be named additional insured on the policy. (6) An endorsement shall be provided which states that the coverage is primary insurance and that no other insurance effected by the Grantor will be called upon to contribute to a loss under this coverage. (7) Standard form of cross-liability shall be afforded. (8) An endorsement stating that the policy shall not be cancelled without thirty (30) days notice of such cancellation given to the Grantor. (b) Grantor reserves the right to adjust the limit coverage requirements no more often than every three (3) years. 145666.2- 120595 6 ! ~ I Any such adjustment by the Grantor will be no greater than the increase in the San Francisco Metropolitan Area Consumer Price Index (all consumers)for such three (3) year period. (c) Grantee shall submit to Grantor documentation of the required insurance including a certificate of insurance signed by the insurance agent and companies named, as well as all properly executed endorsements. (d) Any deductible or self-insured retentions must be declared to and approved by Grantor. At the option of Grantor, the insurer shall reduce or eliminate such deductible or self-insured retention as respects Grantor, its officers and employees or Grantee shall procure a bond guaranteeing payment of losses and related investigation, claims, administration and defense expenses. (e) Grantee hereby indemnifies Grantor for any damage resulting to it from failure of either Grantee or any subcontractor to take out and maintain such insurance. 2.7 Indemnification (a) Grantee shall indemnify, hold harmless, release and defend Grantor, its officers, employees and agents from and against any and all actions, claims, demands, damages, disability, losses, expenses including attorney's fees and other defense costs or liabilities of any nature that may be asserted by any person or entity (other than Grantor) including Grantee from any cause whatsoever including another's concurrent negligence arising out of or in any way connected with the 145666.2- 120595 7 aforesaid operations, the exercise or enjoyment of the franchise renewed pursuant to this Agreement, and/or the activities of Grantee, its subcontractors, employees and agents hereunder. Grantee shall be solely responsible and save Grantor harmless from all matters relative to payment of Grantee's employees including compliance with Social Security, withholding, etc. (b) This indemnification obligation is not limited in any way by a limitation on the amount or type of damages or compensation payable by or for Grantee under Workers' Compensation, disability or other employee benefit acts, acceptance of insurance certificates required under this Agreement, or the terms, applicability or limitations of any insurance held by Grantee. (c) Grantor does not, and shall not, waive any rights against Grantee which it may have by reason of this indemnification, because of the acceptance by Grantor~ or the deposit with Grantor by Grantee, of any of the insurance policies described in this Section. (d) This indemnification by Grantee shall apply to all' damages and claims for damages of any kind suffered by reason of any of the aforesaid operations referred to in this Section, regardless of whether or not such insurance policies shall have been determined to be applicable to any of such damages or claims for damages. (e) Grantee shall not be required to indemnify Grantor for negligence or misconduct on the part of Grantor or its 145666.2- 120595 8 officials, boards, commissions, agents, or employees (hereinafter "such acts"). Grantor shall hold Grantee harmless from any damage resulting from any such acts of the Grantor or its officials, boards, commissions, agents or employees in utilizing any Grantor emergency alert or government or educational access channels, equipment, or facilities and for any such acts committed by Grantor in connection with work performed by Grantor and permitted by this Agreement, on or adjacent to the Cable System. 2.8 Security Fund (a) In accordance with Section 6.76.190 of Ordinance No. 1175-95, within sixty (60) days of the Ordinance adopting this Agreement, Grantee shall establish and provide to Grantor a security fund, as security for the faithful performance by Grantee of all material provision of this Agreement. The security fund shall consist of two (2) parts. The first part shall be a bond, which may be a corporate guarantee and which shall be in the amount of Seventy-five Thousand Dollars ($75,000), and in a form acceptable to the Grantor's City Attorney, and essentially similar to the example provided in Exhibit "B". The second part shall be in the amount of at least Ten Thousand Dollars ($10,000) and shall either be in the form of an irrevocable letter of credit, or a cash deposit established in a local bank in an interest-bearing account payable to the order of the Grantor as trustee for Grantee, with all interest distributed to the Grantee. 145666.2- 120595 9 (b) The bond shall be maintained at the Seventy Five Thousand Dollar ($75,000) level until the system upgrade and/or rebuild provided for in Section 3.1 herein is completed, at which time the bond shall be released, provided there are then no outstanding material violations of this Agreement. The cash or letter of credit portion of the security fund shall be maintained at the Twenty Five Thousand Dollar ($25,000) level throughout the term of this Agreement, provided that at intervals no more often than each three (3) years, Grantor shall have the right to require that this amount be increased to reflect changes in the San Francisco Metropolitan Area Consumer Price. Index during the prior three (3) year period. (c) The security fund may be assessed by Grantor for those purposes specified in Sections 6.76.190 and/or 6.76.340 of Ordinance No. 1175-95 in accordance with the procedures of Section 6.76.350 of said Ordinance, provided that Grantee has received written notice and thirty (30) days after receipt of notice to cure any material violations prior to any assessment. As long as the Grantor follows the procedures specified herein and in Ordinance No. 1175-95 for assessing and/or withdrawing funds from said security fund, Grantee shall not initiate litigation or non-City administrative action to prevent or impair Grantor from accessing those funds. Grantee's recourse, in the event Grantee believes any taking of security funds is improper, shall be through legal action after the security has been drawn upon. If the Grantor's action or taking is found to be improper 145~.2 - 12059~ 10 by any court or agency of competent jurisdiction, Grantee shall be entitled to a refund of the funds plus interest and/or any other award which such court or agency shall make. (d) Nothing herein shall be deemed a waiver of the normal permit and bonding requirements made of all contractors working within the City's rights-of-way. 2.9 Procedure for Remedying Franchise Violations (a) The procedure for remedying franchise violations shall be those expressly set forth in Section 6.76.350 of Ordinance No. 1175-95. (b) If the violation is reasonably curable within thirty (30) days of receipt of Grantor's written notice, and if Grantee has not commenced appropriate corrective action within that thirty (30) day period, or provided a plan to correct the violation in accordance with subsection (c) below, then Grantor may proceed to assess from the security fund damages for Grantee's individual or repeated willful violations of a material franchise requirement of up to Two Hundred Fifty Dollars ($250) per day, or per incident, for unexcused violations of the system upgrade and/or rebuild completion schedule provided in Section 3.1 herein, and up to One Hundred Dollars ($100) per day, or per incident, for all other violations, provided that all such violations of similar nature occurring at the same time shall be deemed one incident. (c) In the event any stated violation is not reasonably curable within thirty (30) days, the franchise will not be terminated or revoked or damages assessed if the Grantee has provided, within said thirty (30) days, a plan, satisfactory to the Grantor, to remedy the violation and continues to demonstrate good faith in seeking to correct said violation. (d) In determining whether violations are material, Grantor shall take into consideration the reliability of the evidence of the violation, the nature of the violation, whether the violation was chronic, the person or persons bearing the impact of the violation, the nature of the remedy required in order to prevent further such violations and such other matters as the Grantor may deem appropriate. 2.10 Reservation of Rights Grantor and Grantee reserve all rights that they may possess under the law unless expressly waived herein. 2.11 State or Federal Preemption In the event that the State or Federal Government discontinues preemption in any area of cable communications over which it currently exercises jurisdiction in such manner as to expand rather than limit municipal regulatory authority, Grantor may, if it so elects, adopt rules and regulations in these areas, after reasonable consultation with Grantee, to the extent permitted in the then applicable law, and provided that Grantee shall not be materially adversely affected in the benefit of its entry into this franchise agreement. SECTION 3. SYSTEM UPGRADE 3.1 Uporade Grantee shall upgrade and/or rebuild, as appropriate, the existing cable system to provide a capacity of at least seventy-eight (78) video channels capable of meeting all applicable FCC signal quality requirements within thirty-six (36) months or less of the effective date of this Agreement. The upgrade/rebuild shall include hybrid fiber optic/coaxial system design or better, with nodes covering no more than two thousand (2000) homes on average. Completion of construction shall be defined as the ability to provide up to seventy-eight (78) channels of video programming to all residential subscribers within the City, as well as satisfactory completion of any permit-specified requirements. Accelerated completion of the upgrade/rebuild in advance of the 36 month deadline shall extend the franchise term to the extent specified in Section 1.4. 3.2 Future System Modifications (a) To assure that Grantee's cable system continues to reflect the general cable industry state-of-the-art throughout the term of the franchise, Grantor and Grantee agree to utilize cable systems in the following California communities as a basis for comparison. The comparison communities (also referred to as the "comparison group") shall be: 145666.2 -- 120595 13 (1) VACAVILLE (5) DALY CITY (2) UNION CITY (6) REDWOOD CITY (3) SAN CARLOS (7) SAN LEANDRO (4) SAN BRUNO (8) SAN MATEO (b) Grantor and Grantee agree that subsequent to the completion of the upgrade and/or rebuild required in Section 3.1 above, when four (4) or more of the cable systems in the comparison group (also referred to as the "comparison subgroup") offer basic programming services which exceed the services provided on Grantee's system by fifteen (15) full channel equivalent video services or more, Grantor may require Grantee to provide additional programming services to meet or exceed the average provided by the comparison subgroup. Grantee shall complete the modification within twelve (12) months of receipt of the Grantor request, subject to the availability of system channel capacity. (c) Grantor and Grantee further agree that subsequent to the completion of the upgrade and/or rebuild required in Section 3.1 above, when four (4) or more of the cable systems in the comparison group have activated upstream communications capacity and are offering interactive residential services, Grantor may require Grantee to activate the upstream capacity of Grantee's system to the same extent. Grantee shall complete this activation within twelve (12) months of receipt of the Grantor request. 145666.2- 120595 14 (d) Any Grantor request for additional services pursuant to subsections (b) and (c) above shall be determined by the City Council after duly noticed public hearing to consider the community needs involved in relation to the resulting costs to Grantee and subscribers. 3.3 Emergency Alert Capability Within twelve (12) months of the effective date of this Agreement, Grantee shall provide the system capability to transmit an emergency alert signal to all participating subscribers, in the form of an audio override capability to permit Grantor to interrupt and cablecast an audio message on all channels simultaneously in the event of disaster or public emergency. Access to the emergency alert capability and security code shall be limited to a small number of authorized personnel in accordance with Grantor's Emergency Operational Plan. 3.4 Standby Power Within twelve (12) months of the effective date of this Agreement, Grantee shall provide standby power generating capacity at the cable communications system control center and at all hubs capable of providing at least twelve (12) hours of emergency supply.. Grantee shall maintain standby power system supplies throughout the major trunk cable networks capable of providing emergency power within the standard limits of commercially available power supply units. 145666.2 -- 120595 1 5 3.5 Parental Control Lock Grantee shall provide, for sale or lease, to subscribers, upon request, a parental control locking device or digital code that permits inhibiting the video and audio portions of premium channels. 3.6 Status Monitoring Grantee shall provide an automatic status monitoring system or a functional equivalent when the cable system has been activated for interactive service provided that sUch status monitoring is technically and economically proven to Grantee's satisfaction. 3.7 Technical Standards The Federal communications Commission (FCC) Rules and Regulations, Part 76, Subpart K (Technical Standards), as amended from time to time, shall apply, to the extent permitted by applicable law. 3.8 Right of Inspection Grantor shall have the right to inspect at Grantor's expense all construction, reconstruction or installation work performed subject to the provisions of the franchise and other pertinent provisions of law, and as part of Grantor's obligation to protect the public health, safety and welfare of its citizens. 145666.2 -- 120595 16 SECTION 4. SERVICES AND PROGRAMMING 4.1 Services and Programming Grantee shall provide Grantor with a list of program services offered, which list shall be updated each time a change is made. Grantee shall not reduce the number of program services without thirty (30) days prior written notification to the Grantor and system subscribers. 4.2 Leased Channel Service Grantee shall offer leased channel service on reasonable terms and conditions and in accordance with applicable law. SECTION 5. 5.1 SUPPORT FOR LOCAL CABLE USAGE EG Access Operation Based on the provisions of the Cable Communications Policy Act of 1984, as amended and future applicable law, Grantor shall determine from time to time the funding level Grantor desires to make available for educational and governmental (EG) access operating costs, and the most appropriate entity or entities to manage EG access operations. Any Grantor request for grant funds for equipment, facilities and channels for EG access use shall be accompanied by an operating plan which delineates the source of the required funds to the extent required by Exhibit "C". 5.2 Grantee SuDDort for EG Usage Grantee shall provide the following or equivalent support for EG cable usage within the franchise area: 145666.2- ~2~9~ 17 Il ! I [ (a) Provision and use of the grant funds and channels designated in Exhibit "C" of this Agreement for local EG programming and access use at no charge in accordance with the requirements of Exhibit "C". (b) Maintenance of Grantee's EG access facilities and channels, and support of EG programming, to the extent specified in Exhibit "C" of this Agreement. (c) Provision of free public building installation and basic service, and provision of live cablecasting~capability from the locations specified in Exhibit "D". 5.3 Compliance with Federal Law In accepting this franchise, the Grantee agrees that the commitments indicated in Section 5.2 above are voluntarily entered into and will not be charged against any franchise fees due the Grantor during the term of the franchise. SECTION 6. REGULATION 6.1 Franchise RegUlation The franchise renewed under this Agreement shall be subject to regulation by Grantor in accordance with all of the lawful provisions of Ordinance No. 1175-95. 6.2 Force Majeure The force majeure provisions of Section 6.76.370 of Ordinance No. 1175-95 shall apply. 6.3 Rate Reoulation If Grantor is permitted under Federal and/or State law, to regulate the rates charged by Grantee, and if Grantor elects 145666.2 -- 120595 18 to so regulate, Grantor shall establish reasonable procedures consistent with due process and follow those procedures before so regulating. IN WITNESS WHEREOF, Grantor and Grantee have executed this Agreement the date and year first above written. APPROVED AS TO FORM: Ap-PROVeD By: Date City Clerk (SEAL) (CORPORATE SEAL) WESTERN TV CABLE, a division of The Chronicle Publishing company Title:~~ ~ 145666.2 -- 011596 19 State of:~ California County of: San Francisco Subscribed and affirmed before me ~Pu~b ~c ~this 22nd day of Ja y, 1996 ,./$/....1~_\,,_\ CC)MM, ~ I~73 ~ ~~ s~ F~NC~O C~ to so regulate, Grantor shall establish reasonable procedures consistent with due process and follow those procedures before so regulating. IN WITNESS WHEREOF, Grantor and Grantee have executed this Agreement the date and year first above written. APPROVED AS TO FORM: CITY OF SOUTH SAN FRANCISCO By: Date: ATTEST-. City Clerk (SEAL) WESTERN TV CABLE, a division of The Chronicle Publishing Company (coRPORATE SEAL) By: Name: Title: Date: 145666.2 -- 120595 19 EXHIBIT A OWNERSHIP 145666.2 -- 120595 EXHIBIT A-1 Grantee Ownership The Chronicle Publishing Company 100% Western TV Cable division-Grantee 145666.2--120595 EXHIBIT A-2 Ownership of TCI (Anticipated Transferee) [FOR INFORMATION ONLY] Tele-Communications, Inc. CTCI") 100% TCI Communications, Inc. CTCI-C") Other TCI Entities 95% 5% TCI Holdings, Inc. 100% TCI of California, Inc. ("TCI-CA") 145666.2 m 120595 A-2 EXHIBIT B SURETY GUARANTEE (SAMPLE) 145666.2- 120595 B-1 EXHIBIT B: SURETY GUARANTEE WHEREAS, the city of South San Francisco (hereinafter called "Grantor") under this Franchise Agreement dated as of the 1st day of January, 1996, has granted a franchise to Western TV Cable, a division of The Chronicle Publishing Company (hereinafter called "Grantee") to own, operate, and maintain a cable television and communications system (hereinafter called "Franchise"); and WHEREAS, The Chronicle Publishing Company (hereinafter called "Guarantor"), a Nevada corporation, being the parent company of the Grantee, has a substantial interest in said Franchise, the conduct of the Grantee, and the Franchise Agreement between Grantor and Grantee establishing Franchise requirements, which Agreement is hereby specifically referred to, incorporated herein and made a part hereof; and WHEREAS, Section 2.8 of said Franchise Agreement requires the Grantee, as Principal, to furnish security issued to cover the faithful performance of certain of the Grantee's obligation under said Franchise, and which security shall be in favor.of the Grantor; NOW THEREFORE, subject to the provisions of Section 2.9, Guarantor hereby unconditionally guarantees the due and punctual performance of any and all obligations of Grantee contained in the Franchise Agreement, up to the financial limits provided in Section 2.8. This Guarantee shall, unless terminated, 145666.2- 120595 B-2 substituted or cancelled as hereinafter provided, remain in full force and effect for the period provided by said Franchise; provided that, upon substitution of another Guarantor reasonably satisfactory to the Grantor, this Guarantee may be terminated, substituted or cancelled upon thirty (30) days prior written notice from Guarantor to the Grantor and Grantee. Any such notice to be given hereunder shall be addressed to Grantor, with a copy to Grantee. Such terminations shall not affect liability incurred or accrued under this Guarantee prior to the effective date of such termination or cancellation. No claim, suit or action under this Guarantee by reason of any default of the Grantee shall be brought against Guarantor unless asserted or commenced no later than six (6) months after the effective date of such termination or cancellation of the Guarantee. IN WITNESS WHEREOF, the Grantee and Guarantor have hereunto set their hands and seals as of this 1st day of January, 1996. WESTERN TV CABLE, a division THE CHRONICLE PUBLISHING of The Chronicle Publishing COMPANY, as Guarantor Company, as Grantee By: By: Title: Title: 145666.2- 120595 EXHIBIT C GRANTEE COMMITMENT TO EG ACCESS FACILITIES AND EOUIPMENT 145666.2- 120595 EXHIBIT C: C-1 GRANTEE COMMITMENT TO EG ACCESS FACILITIES AND EQUIPMENT 1. EDUCATIONAL AND GOVERNMENT (EG) ACCESS CHANNELS No later than one (1) month after the effective date of this Agreement, Grantee shall make one video channel available exclusively for shared EG use. This channel shall be dedicated for the term of the franchise renewal, provided that Grantee may utilize any portions of these channels during any time when they are not scheduled for EG use. Grantor and Grantee shall establish rules and procedures for such scheduling in accordance with Section 611 of the Cable Communications Policy Act of 1984, as amended. Upon completiOn of the system rebuild to seventy-eight (78) channel capacity, Grantor may request and Grantee shall provide up to a total of three (3) channels for EG use, available one-by-one as needed based on substantially full usage of all existing EG channels. Grantor may not submit such a request unless the EG channels already being utilized each are cablecasting at least one hundred (100) hours per month of locally produced unduplicated video programming on each channel already designated for EG use, and, further, that additional contemplated EG programming cannot effectively utilize existing channels during the time they are available. 145666.2- 120595 C-2 2. PROVISION OF INITIAL EG ACCESS EOUIPMENT AND FACILITIES At any time after the effective date of this Agreement, Grantor may request and Grantee shall begin providing EG access grant funds of up to thirty cents ($.30) per subscriber per month as capital to be utilized solely for EG access equipment and facilities. Any request by Grantor for funds under this grant shall be in accordance with an operating plan prepared by Grantor. The operating plan shall contain, as a minimum, the following information: (a) List of intended EG users. (b) Planned type and level of programming for each user. (c) Capital equipment, facilities and estimated costs required to support the intended uses. This shall include a survey of existing publicly-owned equipment that might be available for the intended purposes. (d) User commitments by Grantor or a third party to cover operating expenses and/or support facilities for at least a three (3) year period. The user commitments shall be approved by resolution of the City Council. (e) An evaluation by Grantor that the existing public facilities and equipment are inadequate to meet the needs of the operating plan. 145666.2- 120595 C-3 Based solely on Grantor's certification that the EG operating plan is reasonable and appropriate to meet EG needs and objectives, Grantee shall begin providing the requested funds no later than sixty (60) days after receipt of Grantor request with the operating plan. Grantee is expected to comment upon the plan and provide recommendations to improve its effectiveness, but may not withhold any requested funds accompanied by a Grantor certification of need. If funds provided by Grantee are accumulated and unspent in an amount equal to two (2) years of monthly payments, Grantee may suspend further payment until the balance is reduced under two years worth. 3. PROVISION OF CITY COUNCIL AND GOVERNMENTAL AFFAIRS COVERAGE. Beginning concurrently with the effective date of this Agreement and continuing throughout its term, Grantee shall make available programming production staff assistance of up to ten (10) hours per week for Grantor as and when reasonably requested, intended to provide EG access/local origination camera operator coverage for all City Council meetings unless otherwise .requested, as well as other Grantor governmental affairs activities upon Grantor request; provided that such coverage assistance shall be available to Grantor up to five (5) hours per week after Grantor has purchased its own remote production or portable video camera system usable for such purposes, from the capital grant funds specified in Section 2 immediately above. 145666.2- 120595 C-4 4. EG OPERATIONS Grantor may negotiate agreements with neighboring jurisdictions served by the same cable system, educational institutions, or others to share operating expenses as appropriate. Grantor and Grantee may negotiate an agreement for management of EG facilities, if so desired by the parties. 5. TITLE TO EG EOUIPMENT Grantor shall retain title to and maintain all EG equipment provided with funding made available in accordance with paragraph 2 above. 6. RELOCATION OF EG CHANNELS If Grantee relocates any EG access channel to a different channel number, Grantee shall reimburse Grantor for any out-of-pocket Grantor costs incurred in implementing the relocation. Grantee shall provide Grantor and all subscribers with at least thirty (30) days written notice of such relocation. 7. PROMOTION OF EG ACCESS Grantee shall allow the Grantor to place bill stuffers in Grantee's subscriber statements at a cost to the Grantor not to exceed Grantee's cost, no more than twice per year upon the written request of the Grantor and at such times that the placement of such materials would not affect Grantee's cost for the production and mailing of such statements. The Grantor agrees to pay Grantee in advance for the actual cost of such bill stuffers. Grantee shall also make available access information 145666.2- 120595 C-5 provided by Grantor in subscriber packets at the time of installation and at the counter in the system's business office. Grantee shall also distribute, at no charge to Grantor, through advertising insertion equipment, promotional and awareness commercial spots produced at the Grantor's cost and submitted by the Grantor in a format compatible with such equipment once Grantee has acquired and activated such capability, provided that the number of spots shall be reasonable and Grantee shall not be required to displace or forego any other commitments for commercial or promotional spots. Grantee shall also include a listing of the known programs to be cablecast on EG access channels in any program guide of services for the cable system. 145666.2- 120595 ~' i Il EXHIBIT D SERVICE TO PUBLIC FACILITIES 145666.2- 120595 D-1 PUBLIC BUILDINGS TO BE PROVIDED WITH ONE FREE CABLE TV CONNECTION AND THE HIGHEST LEVEL OF BASIC SERVICE: CITY BUILDINGS: City Hall, 400 Grand Ave. City Hall Annex, 315 Maple Ave. M.S.B. LIBRARIES: Grand Ave./306 Walnut 840 W. Orange Ave. FIRE DEPARTMENTS: Central Station, 201 Baden Ave. Station 2, 249 Harbor Way Station 3, 33 Arroyo Station 4, 2350 Galway Station 5, 1151 So. San Francisco Dr. PARK & RECREATION FACILITIES: E1 Camino Ctr., 33 Arroyo Ave. Magnolia Ctr., 601 Grand Ave. Siebecker Ctr., 510 Elm Court Paradise Valley Park Buri Buri Park, 200 Arroyo Dr. Sellick Park, Applian Way Orange Memorial Park Brentwood Park Rosewood & Briarwood Winston Manor Pk, 20 Elkwood Westborough Pk, Westborough & Galway Swimming Pool, 725 Tennis Dr. ORANGE MEMORIAL PARK: Park Corp Yard, 781 Tennis Dr. Recreation Bldg, 788/Tennis Dr. Little Bldg, 720 Memorial Dr. OTHER PUBLIC BUILDINGS: Bldg in Picnic Area, 753 Memorial Dr. 772 Tennis Dr. 746 Tennis Dr. Street.Corp. Yard, 736 Tennis Dr. Suite A City Garage, 736 Tennis Drive, Suite B 145666.2- 120595 ]~ I I I D-2 PUBLIC BUILDINGS TO BE PROVIDED WITH LIVE PROGRAM ORIGINATION CAPABILITY: CITY COUNCIL CHAMBERS. 3. CITY PUMP STATION CONNECTIONS. Grantor may request, not less than three (3) years after the effective date of this Agreement, and Grantor shall provide within nine (9) months of such request, two-way capable connections to any Grantor pump station locations listed below, subject to prior consultation with Grantee concerning the estimated cost, and subject to pass-through cost recovery by Grantee on an amortization schedule not less than five (5) years in duration: 235 Shaw Rd. Shaw Rd. to 479 San Mateo Ave. 477 South Airport Blvd. 477 S. Airport to 195 Belle Air Rd. Harbor to 160 Utah Ave. ext: Harbor to 220 Littlefield Ave. Oyster Point to Eccles to 572 Forbes Blvd. 572 Forbes to 701 Forbes Blvd. 701 Forbes to 801 Forbes Blvd. East Grand to 195 Kimball Way 383 Oyster Point Bi. 955 Gateway B1. 249 Harbor Way 145666.2- 120595 I I I D-3 4. PUBLIC SCHOOL CONNECTIONS Grantee shall continue throughout the term of this Agreement to provide a cable connection and the highest level of basic cable service to each Grantor public school in the City; provided that Grantee shall build and provide such a connection and service to Westborough Middle School upon Grantor's request at such time as Grantee is under common ownership with any franchised cable operator serving the City of Daly City. 145666.2- 120595