R2008-03 AUTHORIZING EXECUTION OF FRANCHISE AGREEMENT

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. f .. ,' � I 5.3 Return Lines. Comcast shall maintain throughout the life of this Franchise the current return line that is in place as of the Effective Date from City Hall to Comcast's Headend facility in order to enable the distribution of PEG access programming to Comcast's residential Subscribers, unless the location is no longer used by City to transmit programming. At such time that the City determines that it wants the capacity to allow it to transmit government access channel programming originating from any other municipal government facilities that do not currently have a signal point of origination, to Comcast's residential Customers, the City shall give Comcast written notice detailing the location of the additional signal point or points of origination. Upon receipt of such written notice, Comcast agrees to submit a cost estimate (computed on a time plus materials basis - without markup for profit) to implement the City's plan within a reasonable period of time. After an agreement to reimburse Comcast for its expenditure is reached, Comcast will implement any necessary system changes within a reasonable period of time. City may utilize PEG Capital Funds it collects pursuant to Section 5.4 to pay for costs relating to necessary cable system changes. 5.4 PEG Capital Fee. Comcast will provide quarterly, within forty-five (45) days after the close of each quarter a fee of$.35 cents that it will collect from each Subscriber per month (PEG Capital Fee"). This PEG Capital Fee shall be paid to the City for purchasing capital directly related to City's PEG programming pursuant to 47 U.S.C. §542(g)(2)(C). Comcast shall include this PEG Capital Fee as a line item on each Subscriber's bill. Any time after January 1, 2013, the City may send written notice to Comcast to collect $.35 per Subscriber per manth plus the cumulative increase in the Consumer Price Index for the State of Illinois from January 1, 2008 to December 31, 2012. Comcast shall begin to collect the new PEU Capital Fee amount within ninety (90) days of receiving written notice. City agrees to expend the PEG Capital Fee solely for capital costs associated with PEG access. City shall be permitted to hold all or a portion of the PEG Capital Fee from year to year as a designated fund to permit the City to make large capital expenditures, if necessary as long as City spends entire amount collected by the end of the term of this Agreement. Moreover, if City chooses to borrow from itself or a financial institution revenue for large PEG access capital purchases or capital expenditures, City shall be permitted to make periodic repayments using the PEG Capital Fee. 5.4.1 City's Use of PEG Capital Fee. City shall provide Comcast, upon reasonable advance written request, with an accounting of any expenditures of the PEG Capital Fee to insure such fees are used for capital costs related to PEG Access and not used for operational expenses, such as employee salaries. If Comcast believes City has failed to demonstrate compliance with the expenditure limitations of the PEG Capital Fee, Comcast shall provide City, within thirty (30) days of receipt of such an accounting, notice of Comcast's objections. The Parties shall thereafter meet at the reasonable request of either party to address the objections identified by Comcast. If Comcast reasonably concludes that City has expended the PEG Capital Fee in a manner inconsistent with the limitations imposed herein the Comcast may, after thirty (30) days notice to the City advise the City of its intention to implement a credit on its next regularly scheduled franchise fee payment in the amount of any expenditure inconsistent with the PEG Capital Fee. If the City disputes Comcast's allegation the City may commence a franchise violation proceeding against Comcast pursuant to Section 19 hereof. In the event the City commences a franchise violation proceeding against Comcast, Comcast shall hold the disputed monies in a separate interest bearing account 6 1043854v2