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2003-47

A RESOLUTION

APPROVING CONSENTING TO THE CHANGE OF CONTROL OF THE CITY'S CABLE FRANCHISE AGREEMENT FROM WIDEOPENWEST COLORADO, LLC TO CHAMPION BROADBAND, LLC

WHEREAS, on October 20, 2000, the City of Lakewood, Colorado (the "City") granted to WideOpenWest Colorado, LLC, ("Grantee"), a franchise to own, construct and operate a cable television system in the City as set forth in the Cable Communications Franchise Agreement dated October 20, 2000 (the "Franchise"); and

WHEREAS, Section 17.2 of the Franchise requires the City's consent to any change of control of the Grantee; and

WHEREAS, Grantee has entered into an agreement dated as of March 14, 2003 (the "Agreement"), whereby Grantee is being acquired by Champion Broadband, LLC ("Champion"); and

WHEREAS, pursuant to Section 17.2 of the Franchise and 47 U.S.C. Sec. 537, as amended, Grantee and Champion have requested that the City approve the change of control of Grantee to Champion; and

WHEREAS, the City has investigated both the status of the Franchise, Grantee's compliance therewith, Grantee's ability to comply with the Franchise going forward, Champion's plans for future operations pursuant to the Franchise in the City, and the ability of Champion to comply with the Franchise; and

WHEREAS, based upon the City's investigation, and representations made to the City by senior management of Grantee and Champion, the City understands that Grantee is not able to comply with its obligations under the Franchise as adopted, and but for the Agreement, had planned to shut down operations in Colorado; and

WHEREAS, based upon the City's investigation, and representations made to the City by Grantee and Champion, the City has agreed to modify and amend the Franchise to provide, among other things, that the build-out obligations will be temporarily placed in suspense; and

WHEREAS, it is the policy of the City to encourage competition of cable services to City residents, through franchise agreements that will eventually provide for competitive services throughout the entire City; and

WHEREAS, in light of the decision of Grantee's management to shut down operations in Colorado, and the terms, conditions and obligations of the Franchise Amendment between Grantee and the City dated June 23, 2003, the City believes that approval of this Resolution provides the best option available at the present time for cable competition to develop within the City; and

WHEREAS, based upon the City's investigation, and representations made to the City by Grantee and Champion, upon which the City is relying, the City is prepared to approve the change of control of Grantee to Champion, pursuant to the conditions described herein.

NOW THEREFORE, be it resolved by the City Council of the City of Lakewood, Colorado, as follows:

1. The City hereby consents to and approves the change of control of Grantee to Champion.

2. The City confirms that the Franchise, as amended on June 23, 2003, expires on November 19, 2015.

3. This Resolution approving the transfer of the Franchise is based in part upon the following representations and acknowledgments made by Grantee and Champion to the City, all of which are considered material and have been relied upon by the City but none of which act to alter or in any way modify or amend the Franchise:

(a) That the Agreement, and all of the attachments to that document, provided to the City with FCC Form 394 (except for those materials that have been redacted pursuant to law, and are identified by title or topic in the Agreement and its attachments) constitutes the entire agreement regarding the sale of cable systems between Grantee and Champion;

(b) That all customer service standards adopted by the City remain in full force and effect, and Champion will comply with said standards and all federal regulations regarding technical standards of cable systems;

(c) That Champion shall comply with all terms, conditions and obligations of the Franchise.

(d) That Champion will comply with all applicable laws regarding rates for cable services within the Franchise area and all applicable laws covering issues of cross subsidization;

(e) That during the term of the Franchise, and any extension thereto, Champion will pay Franchise fees on gross revenues generated by sale of cable services, regardless of how cable services and non-cable services may be bundled together and sold to subscribers. Champion shall not take any action to evade or avoid payment of Franchise fees based upon the reasonable value of the revenues received for cable services from paying customers. The City and Champion reserve all rights, claims, defenses and remedies regarding the City's authority to impose and/or enforce requirements related to the revenue allocation methodology to be used when cable services and non-cable services are bundled together for the purpose of calculating Franchise fees.

(f) That but for this transaction, Grantee had planned to shut down all operations in the State of Colorado. As a result of the Franchise amendment dated June 23, 2003, and consistent with its terms, Champion intends to take all reasonable steps to be in a position to complete the construction of its cable system in the City at the earliest possible time.

(g) That in the event of any failure to comply with the provisions of this Resolution, or any material misrepresentations concerning the same, the City may enforce any damages or penalty provisions pursuant to the Franchise and exercise any other remedy available to it by law.

4. This Resolution shall take effect upon the closing of the transaction contemplated by the Agreement.

5. This Resolution is conditioned upon approval of the transaction contemplated by the Agreement by all required federal government agencies, in substantially the same form as the transaction described in the Agreement and related documents delivered to the City with Grantee's and Champion's Form 394 filing. Should the transaction as ultimately approved differ in any material respect from that represented in the Form 394 and accompanying documents, this Resolution shall be voidable, at the sole option of the City.

6. Within thirty (30) days following Grantee's and Champion's receipt of an executed copy of this Resolution, Grantee and Champion shall give written notice to the City that they unconditionally agree with and shall be bound by all terms contained in this Resolution.

7. Within thirty (30) days following the closing of the Agreement, Champion shall file with the City a written representation that the above conditions have been met.

INTRODUCED, READ AND ADOPTED by a vote of 9 for and 0 against at a regular meeting of the City Council on June 23, 2003, at 7:00 o'clock p.m. at Lakewood Civic Center, 480 South Allison Parkway, Lakewood, Colorado.

Stephen A. Burkholder, Mayor

ATTEST:
Margy Greer, City Clerk