AN ORDINANCE RENEWING THE FRANCHISE FOR THE OPERATION OF A CABLE SYSTEM TO T.C.I. OF OREGON, INC., AND SUPERCEDING ORDINANCE NUMBER 380.

WHEREAS, the City of Yamhill, has determined that the financial, legal, and technical ability of TCI of Oregon is reasonably sufficient to provide services, facilities and equipment necessary to meet the future cable-related needs of the community; now, therefore

THE CITY OF YAMHILL ORDAINS AS FOLLOWS:

SECTION 1 DEFINITION OF TERMS:

1.1 Terms. For the purpose of this Ordinance, the following terms, phrases, words, and abbreviations shall have the meanings ascribed to them below:

a. "Affiliate" means an entity which owns or controls is owned or controlled by, or is under common ownership with GRANTEE.

b. "Basic Cable" means any service tier which includes the retransmission of local signals required to be carried on the Cable System, for which GRANTEE charges the lowest monthly charge.

c. "Cable Act" means the Cable Communications Policy Act of 1984, as amended.

d. "Cable Service" means (i) the one-way transmission to subscribers of Video Programming or other programming service, and (ii) subscriber interaction, if any, which is required for the selection of such Video Programming or other programming service.

e. "Cable System" means a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment or other communications equipment that is designed to provide Cable Service and other service to subscribers.

f. "FCC" means Federal Communications Commission, or successor governmental entity thereto.

g. "Franchise" shall mean the initial authorization or renewal thereof, issued by the Franchising Authority, whether such authorization is designated as a franchise, permit license, resolution, contract, certificate, or otherwise, which authorizes construction and operation of the Cable System for the purpose of offering Cable Service or other service to subscriber.

h. "Franchise Authority" means the CITY OF YAMHILL, or the lawful successor, transferee or assignee thereof.

i. "Grantee" means TCI of Oregon, or the lawful successor, transferee or assignee thereof.

j. "Gross Revenues" shall mean the gross receipts received form services provided within the service area of the CITY OF YAMHILL during each calendar year, but excluding therefrom those amounts received by Company for installation, construction, connection services, advertising carried on Cable System, or those specifically excluded by section 622 (g) (2) of the Cable Act.

k. "Person" means an individual, partnership, association, joint stock company, trust corporation, or governmental entity.

l. "Public Way" shall mean the surface of, and the space above and below, any public street, highway, freeway, bridge, land path, alley, court, boulevard, sidewalk, parkway, way, lane, public way, drive, circle or other public right-of-way, including public utility easements, dedicated utility strips or right-of-way dedicated for compatible uses and any temporary or permanent fixtures or improvements located thereon now or hereafter held by the Franchise Authority in the Service Area which shall entitle the Franchise Authority and the GRANTEE to the use thereof for the purpose of installing, operating, repairing and maintaining the Cable System. Public Way shall also mean any easement now or hereafter held by the Franchise Authority within the Service Area for the purpose of public travel, or for utility or public service use dedicated for compatible uses, and shall include other easements or rights-of-way as shall within their proper use and meaning entitle the Franchise Authority and the GRANTEE to the use thereof for the purposes of installing or transmitting Grantee's Cable Service or other service over poles, wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, compliances, attachments and other property as may be ordinarily necessary and pertinent to the Cable System.

m. "Service Area" means the present municipal boundaries of the Franchise Authority, and shall include any additions thereto by annexation or other legal means.

n. "Service Tier" means a category of Cable Service or other services provided by GRANTEE and for which a separate charge is made by GRANTEE.

o. "Subscriber" means a person or user of the Cable System who lawfully receives Cable Services or other service therefrom with the Grantee's express permission.

p. "Video Programming" means programming provided by, or generally considered comparable to programming provided by, a television broadcast station.

SECTION 2 GRANT OF FRANCHISE:

2.1 Grant. The CITY hereby grants to GRANTEE a nonexclusive Franchise which authorizes the GRANTEE to construct and operate a Cable System and offer Cable Service and other services in, over, upon and under the streets and alleys, and public highways of the CITY and to stretch wires and cables underground on all streets and alleys and to erect other appurtenances and to maintain and use the same as a coaxial cable subscription system for television signal distribution to subscribers' terminals.

2.2 Term. The Franchise granted pursuant to the Ordinance shall be for an initial term of ten (10) years from the effective date of the Franchise as set forth in Section 2.3, unless otherwise lawfully terminated in accordance with the terms of this Ordinance. The GRANTEE herein shall have an option for an additional ten (10) year renewal of said franchise upon giving notice to the CITY of the exercise of said option six (6) months prior to the termination date herein.

2.2 Acceptance; Effective Date. This Franchise Ordinance shall be effective only upon condition that Company shall, within thirty days after adoption of this Ordinance, file with the CITY Recorder written acceptance of this Franchise and the terms hereby imposed. Upon receipt of written acceptance, this Franchise Ordinance shall become effective August 1, 1996.

SECTION 3 STANDARDS OF SERVICE:

3.1 Service Standards. The GRANTEE shall maintain and operate its system and render efficient service in accordance with the rules and regulations as are or may be set forth by the CITY, provided, however, that CITY shall not unreasonably and materially amend, restrict or interfere with the rights and privileges granted herein, except with the consent of the GRANTEE.

3.2 Notice of Interruption for Repairs. Whenever it is necessary to shut off or interrupt service for the purpose of making repairs, adjustments or installations, the GRANTEE shall do so at such time as will cause the least amount of inconvenience to its customers, and unless such interruption is unforeseen and immediately necessary, it shall give reasonable notice thereof to its customers.

3.3 Payment Facilities. The GRANTEE shall maintain or arrange for facilities in the CITY where its customers may pay their bills for cable service during normal business hours.

3.4 Conditions for Excusing Service. The Grantee's obligation to provide, repair, replace, construct, maintain or operate cable service as set forth herein shall be excused for any period during which such service, is prevented or interrupted by causes beyond the Grantee's control, including acts of God, fire, flood, unavoidable casualty, extra-ordinary delays in transportation, strikes or power interruption, regulations or controls. Service shall thereafter be restored as soon as reasonably possible.

3.5 Authority to Promulgate Rules. Subject to the provision hereof, the GRANTEE shall have the authority to promulgate such rules, regulations, terms and conditions governing the conduct of its business as shall be reasonable necessary to enable the GRANTEE to exercise its rights and perform its obligations under this Franchise, and to assure an uninterrupted service to each and all its customers, provided, however, that such rules, regulations, terms and conditions shall not be in conflict with the provisions hereof or of laws of the State of Oregon.

3.6 Conditions on Street Occupancy. Use. All transmission and distribution structures, lines and equipment erected by the GRANTEE within the CITY shall be so located as to cause minimum interference with the proper use of streets, alleys and other public ways and places, and to cause minimum interference with the rights and reasonable convenience of property owners who adjoin any of the said streets, alleys or other public ways and places.

3.7 Restoration on Street Occupancy. In case of any disturbance of pavement, sidewalk, driveway or other surfacing, the GRANTEE shall, at its own cost and expense and in a manner approved by the CITY, replace and restore all paving, sidewalk, driveway or surface of any street or alley disturbed, in as good condition as before said work was commenced. If GRANTEE fails to restore promptly the affected portion of the street, alley or public way to the same condition in which it was prior to the excavation, the CITY may make the restoration, and the reasonable cost of making the restoration, including the cost of inspection, supervision and administration shall be paid by the GRANTEE.

3.8 Relocation on Street Occupancy. In the event that at any time during the period of this Franchise the CITY shall lawfully elect to alter, or change the grade of, any street, alley or other public way, the GRANTEE, upon reasonable notice by the CITY, shall remove, relay and relocate its poles, wires, cables, underground conduits, manholes and other television fixtures at its own expense.

3.9 Vacation or Closure of Street, Alley or Public Way. In the event that at any time during the period of this Franchise, the CITY shall lawfully elect to vacate, alter or close any street, alley or public way, Grantee's rights shall be preserved for the remainder of the term hereof as to any of its facilities then existing in such street or public way; provided, however, if the vacation is for the benefit or convenience of the CITY, Grantee's rights hereinunder may at the election of the CITY be terminated with respect to such street or alley so vacated.

3.10 Placement of Fixtures. The GRANTEE shall not place poles or other fixtures where the same will interfere with any gas, electric or telephone fixtures, water hydrant or main, and all such poles or other fixtures placed in any street shall be placed at the outer edge of the sidewalk and inside the curb line, and those placed in alleys shall be placed close to the line of the lot abutting on said alley, and then in such a manner as not to interfere with the usual travel on said streets, alleys and public ways.

3.11 Temporary removal of wires for building moving. The GRANTEE shall, on the request of any person holding a building permit issued by the CITY, temporarily raise or lower its wires to permit the moving of buildings. The expense of such temporary removal, raising or lowering the wires shall be paid by the person requesting the same, and the GRANTEE shall have the authority to require such payment in advance. The GRANTEE shall be given not less than five (5) working days advance notice to arrange for such temporary wire changes. GRANTEE shall not require payment from the CITY OF YAMHILL for wire changes performed for civic functions.

3.12 Tree Trimming. The GRANTEE shall have the authority to trim trees upon and overhanging streets, alleys, sidewalks and public places of the CITY so as to prevent the branches of such trees from coming in contact with the wires and cables of the GRANTEE, all trimming to be done under the supervision and direction of the CITY and at the expense of the GRANTEE.

3.13 Safety, Standards, and Work Specifications.

(1) The Facilities of the GRANTEE shall be at all times maintained in a safe, substantial and workmanlike manner.

(2) The location, construction, extension, installation, maintenance, removal and relocation of the facilities of the GRANTEE shall conform to:

(i) The requirements of all local, state and Federal Statutes, ordinances and codes, and regulations adopted pursuant thereto, in force at the time of such work.

(ii) Such reasonable specifications in force at the time of such work, as the CITY may from time to time adopt.

(3) For the purpose of carrying out portions (1) and (2) of this subsection, the CITY may provide such specifications relating thereto as may be necessary or convenient for public safety or the orderly development of the CITY. The CITY may amend and add to such specifications from time to time.

3.14 (a) GRANTEE shall furnish cable services under this Ordinance within the CITY limits whenever there is cost of installing cable and equipment. Specifically, GRANTEE shall extend its plant to provide service to subscribers at no additional cost above its normal installation fees in all contiguous areas having a density of twelve homes per 400 cable meters (1300 cable feet). Any home within 150 feet of a proposed cable location will be included for the purpose of determining such density.

(b) It is hereby declared to be the policy of GRANTEE and CITY to extend cable service to as many homes as possible within the territorial limits of the CITY. Accordingly, CITY agrees to facilitate the wiring of homes and subdivisions by adoption of the procedures hereafter set forth, and GRANTEE agrees to provide and install cable, at no cost, upon the terms and conditions hereafter set forth:

(1) In all new subdivisions, the CITY hereby requires that the developer of any such subdivision shall notify GRANTEE of its intent to install electrical utilities at least ten days prior to the date that trenches shall be opened for the purpose of the installation of such electrical utilities, and such developer and GRANTEE shall work together to provide an opportunity for installation of underground cable wiring throughout the streets of such proposed subdivision while such trenches are open. All such cable shall be installed in a manner so as to comply with the requirements of the electric utility provider and all applicable codes. Such cable shall be provided and placed in the open trench at the expense of GRANTEE. Such trench shall be opened and, upon completion of the necessary work, closed and back-filled, at the expense of developer.

(2) In any new home constructed within the CITY, whether or not cable T.V. home service is currently available to such home and whether or not the owner or occupant agrees to utilize such service, GRANTEE will prewire such residential structure for future utilization of cable T.V. services, upon condition that GRANTEE is provided at least ten (10) days notice of opportunity to prewire such structure, prior to the covering of walls or the making of other enclosures which would unreasonable interfere with the procedures required for such prewiring. CITY will reasonably cooperate with GRANTEE in establishing public awareness of such service.

SECTION 4 REGULATION BY FRANCHISE AUTHORITY:

4.1 Franchise Fee. GRANTEE shall pay to the CITY OF YAMHILL a franchise fee equal to 5% of Gross Revenues received by GRANTEE from the operation of the Cable System on an annual basis. For the purpose of this section, the 12-month period applicable under the Franchise for the computation of the franchise fee shall be a calendar year. The franchise fee payment shall be due and payable ninety (90) days after the close of the preceding calendar year. Each payment shall be accompanied by a brief report from a representative of GRANTEE showing the basis for the computation. In no event, shall the franchise fee payments required to be paid by GRANTEE exceed 5% of gross revenues received by GRANTEE in any 12-month period.

4.2 Rates and Charges. Said GRANTEE shall have the right to charge and collect reasonable compensation from all persons and corporations to whom said electronic transmission service shall be furnished (including installation charges), subject to any rules and regulations of legally constituted regulatory bodies of the County, State, or Federal Government.

4.3 Renewal of Franchise. The CITY OF YAMHILL and the GRANTEE agree that any proceedings undertaken by the CITY OF YAMHILL that relate to the renewal of the Grantee's Franchise shall be governed by and comply with the provisions of Section 626 of the Cable Act (as such existed as of the effective date of the Cable Act), unless the procedures and substantive protections set forth therein shall be deemed to be preempted and superseded by the provisions of any subsequent provisions of federal or state law.

In addition to the procedures set forth in said Section 626 (a), the CITY OF YAMHILL agrees to notify GRANTEE of its preliminary assessments regarding the identity of future cable related community needs and interests, as well as, the past performance of GRANTEE under the then current franchise term. The CITY OF YAMHILL further agrees that such a preliminary assessment shall be provided to the GRANTEE prior to the time that the four (4) month period referred to in subsection (c) of Section 626 is considered to begin. Notwithstanding anything to the contrary set forth in this Section 4.3, the GRANTEE and CITY OF YAMHILL agree that at any time during the term of the then current franchise, while affording the public appropriate notice and opportunity to comment, the CITY OF YAMHILL and GRANTEE may agree to undertake and finalize negotiations regarding renewal of the then current franchise and the CITY OF YAMHILL may grant a renewal thereof. The GRANTEE and the CITY OF YAMHILL consider the terms set forth in this section to be consistent with the express provisions of section 626 of the Cable Act. A reproduction of section 626 of the Cable Act as such existed as of schedule 2 and incorporated herein by this reference.

4.4 Conditions of Sale. If a renewal of Grantee's Franchise is denied and the CITY OF YAMHILL either acquires ownership of the Cable System or transfers ownership to another party, any such acquisition or transfer shall be at a fair market value, determined on the basis of the Cable System valued as a going concern, but with no value allocated to the Franchise itself.

If Grantee's Franchise is revoked for cause and the CITY OF YAMHILL acquires ownership of the Cable System or by its actions effects a transfer of ownership of the Cable System to another person, any such acquisition or transfer shall be at an equitable price. GRANTEE and the CITY OF YAMHILL agree that in the case of a revocation, at Grantee's request, which shall be made in its sole discretion, GRANTEE shall be given a reasonable opportunity to effectuate fair market value, determined on the basis of the Cable System valued as an ongoing concern. The CITY OF YAMHILL further agrees that during such a period of time, it shall authorize the GRANTEE to continue to operate pursuant to the terms of its prior Franchise; however, in no event shall such authorization exceed a period of time greater than six (6) months from the effective date of such revocation. If, at the end of that time, GRANTEE is unsuccessful in procuring a qualified transferee or assignee of its Cable System, which is reasonably acceptable to the CITY OF YAMHILL, GRANTEE and CITY OF YAMHILL may avail themselves of any rights they may have pursuant to federal or state law; it being further agreed that Grantee's continued operation of its Cable system during the six (6) month period shall not be deemed to be a waiver, nor an extinguishment of, any rights of either the CITY OF YAMHILL or the GRANTEE. Notwithstanding anything to the contrary set forth in section 4.4, neither CITY OF YAMHILL nor GRANTEE shall be required to violate federal ar state law.

4.5 Transfer of Franchise. Grantee's right, title, or interest in the Franchise shall not be sold, transferred, assigned or otherwise encumbered, other than to an affiliate, without the prior express written consent of the CITY OF YAMHILL, such consent not to be unreasonably withheld. No such consent shall be required, however, for a transfer in trust, by mortgage, by other hypothecation, or by assignment of any rights, title, or interest of GRANTEE in the Franchise of Cable System in order to secure indebtedness.

SECTION 5 COMPLIANCE AND MONITORING:

5.1 Testing for Compliance. System during reasonable time and in a manner which does not unreasonably interfere with the normal business operations of the GRANTEE or the Cable SYSTEM in order to determine whether or not the GRANTEE is in compliance with the terms hereof and applicable state or federal laws. Except in emergency circumstances, such tests may be undertaken only after giving GRANTEE reasonable notice thereof, not to be less than two (2) business days and providing a representative of GRANTEE an opportunity to be present during such tests. In the event that such testing demonstrates that the GRANTEE has substantially failed to comply with a material requirement hereof, the reasonable costs of such tests shall be borne by the GRANTEE. In the event that such testing demonstrates that GRANTEE has substantially complied with such material provisions hereof, the cost of such testing shall be borne by the CITY OF YAMHILL. Except in emergency circumstances, the CITY OF YAMHILL agrees that such testing shall be undertaken no more than six (6) times a year in the aggregate, and that the results thereof shall be made available to the GRANTEE upon Grantee's request.

5.2 Books and Records. The GRANTEE agrees that the CITY OF YAMHILL may review such of its books and records as are reasonably necessary to monitor compliance with the terms hereof. Such records shall include, but shall not be limited to, any public records required to be kept by the GRANTEE pursuant to the rules and regulations of the FCC. Notwithstanding anything to the contrary set forth herein, GRANTEE shall not be required to disclose information which it reasonably deems to be proprietary or confidential in nature. The CITY OF YAMHILL agrees to treat any information disclosed by the GRANTEE to it on a Confidential basis, and only to disclose it to employees, representatives, and agents thereof that have a need to know, or in order to enforce the provisions hereof.

SECTION 6 INSURANCE, INDEMNIFICATION, AND BONDS OR OTHER SURETY:

6.1 Insurance Requirements. GRANTEE shall maintain in full force and effect, at its own cost and expense, during the term of the Franchise, General Comprehensive Liability Insurance in the amount of $500,000. for bodily injuries, (including accidental death) to any one person, and subject to the same limit for each person in amount not less than %500,000. on account of any one occurrence, and Property Damage Liability Insurance in an amount not less that $100,000. resulting from any one occurrence. Said insurance shall designate the CITY OF YAMHILL as an additional named insured. Such insurance shall be non-cancelable except upon sixty (60) days prior written notice to the CITY OF YAMHILL.

6.2 Indemnification. The GRANTEE agrees to indemnify, save and hold harmless and defend the CITY OF YAMHILL, its officers, boards and employees, from and against any liability for damages and for any liability or claims resulting from property damage or bodily injury, (including accidental death), which arise out of the Grantee's construction, operation, or maintenance of its Cable SYSTEM, including, but not limited to, reasonable attorney's fees and costs.

6.3 Bonds and Other Security. Except as expressly provided herein, GRANTEE shall not be required to obtain or maintain bonds or other surety as a condition of being awarded the Franchise or continuing its existence. In the event that one is required in the future, the CITY OF YAMHILL agrees to give GRANTEE at least sixty (60 days prior notice thereof stating the exact reason for the requirement. Such reasons must demonstrate a change in the Grantees legal, financial or technical qualifications which would materially prohibit or impair its ability to comply with the terms of the Franchise or afford compliance therewith.

SECTION 7 ENFORCEMENT AND TERMINATION OF FRANCHISE:

7.1 Notice of Violation. In the event that the CITY OF YAMHILL believes that the GRANTEE has not complied with the terms of the Franchise, it shall notify GRANTEE of the exact nature of the alleged non-compliance.

7.2 Grantee's Right to Cure and Duty to Respond. GRANTEE shall have ten (10) days from receipt of the notice described in section 7.1 to acknowledge receipt of the notice of violation and Grantee's intent to contest or cure. GRANTEE shall have thirty (30) days from the receipt of the notice to; (a) respond to the notice of violation contesting the assertion of non-compliance; or (b) to cure such default or, in the event that, by the nature of default, such default cannot be cured within the thirty (30) day period, initiate reasonable steps to remedy such default and notify the CITY OF YAMHILL of the steps being taken and the projected date that they will be completed.

7.3 Public Hearing. In the event that GRANTEE fails to respond to the notice described in section 7.1 pursuant to the procedures set forth in section 7.2, or in the event that the alleged default is not remedied within sixty (60) days after the GRANTEE is notified of the alleged default pursuant to section 7.1, the CITY OF YAMHILL shall schedule a public meeting to investigate the default. Such public meeting shall be held at the next regularly scheduled meeting of the CITY OF YAMHILL which is scheduled at a time which is no less than ten (10) business days therefrom. The CITY OF YAMHILL shall notify the GRANTEE of the time and place of such meeting and provide the GRANTEE with an opportunity to be heard.

7.4 Enforcement. Subject to applicable federal and state law, in the event the CITY OF YAMHILL, after such meeting, determines the GRANTEE is in default of any provision of the Franchise, the CITY OF YAMHILL may:

a. Foreclose on all or any part of any security provided under this franchise, if any, including, without imitation, any bonds or other surety; provided, however, the foreclosure shall only be in such a manner and in such amount as the CITY OF YAMHILL reasonably determines is necessary to remedy the default;

b. Commence an action at law for monetary damages or seek other equitable relief;

c. In the case of a substantial default of a material provision of the franchise, declare the franchise agreement to be revoked; or

d. Seek specific performance of any provision, which reasonably lends itself to such remedy, as an alternative to damages.

The GRANTEE shall not be relieved of any of its obligations to comply promptly with any provision of the franchise by reason of any failure of the CITY OF YAMHILL to enforce prompt compliance.

7.5 Acts of God. The GRANTEE shall not be held in default or non-compliance with the provisions of the franchise nor suffer any enforcement or penalty relating thereto, where such non-compliance or alleged defaults are caused by strikes, act of God, power outages, or other events reasonably beyond its ability to control.

SECTION 8 MISCELLANEOUS PROVISIONS:

8.1 Documents Incorporated and Made a Part Hereof. The following documents shall be incorporated herein by this reference, and in the case of a conflict or ambiguity between the, the document of latest date shall govern:

a. Any enabling ordinance in existence as of the date hereof, and

b. Any franchise agreement between GRANTEE and CITY OF YAMHILL reflecting the renewal of the franchise, if any.

8.2 Preemption. If the FCC, or any other federal or state body or agency shall now or hereafter exercise any paramount jurisdiction over the subject matter of the franchise, then to the extent such jurisdiction shall preempt and supersede or preclude the exercise of the like jurisdiction of the CITY OF YAMHILL, the jurisdiction of the CITY OF YAMHILL shall cease and no longer exist.

8.3 Actions of Franchising Authority. In any action by the CITY OF YAMHILL or representative thereof mandated or permitted under the terms hereof, such party shall act in a reasonable, expeditious and timely manner. Furthermore, in any instance where approval or consent is required under the terms hereof, such approval or consent shall not be unreasonably withheld.

8.4 Descriptive Heading. The captions to sections contained herein are intended solely to facilitate the reading thereof. Such captions shall not affect the meaning or interpretation of the test herein.

8.5 Severability. If any section, sentence, paragraph, term or provision hereof is determined to be illegal, invalid or unconstitutional, by any court of common jurisdiction or by any state or federal regulatory authority having jurisdiction thereof, such determination shall have no effect on the validity of any other section, sentence, paragraph, term or provision hereof, all of which will remain in full force and effect for the term of the franchise or any renewal or renewals thereof.

INTRODUCED AND ADOPTED by the City of Yamhill Council and signed by me in authentication of its passage this 24th day of January , 1996.