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HomeMy WebLinkAboutResolution - 95-114 - Sale and Transfer of Cable TV Franchise to Time Warner, Inc. - 06/06/1995 STATE OF MINNESOTA CITY OF EDEN PRAIRIE RESOLUTION NO. a 4 APPROVING THE TRANSFER OF CONTROL OF KBL CABLESYSTEMS OF THE SOUTHWEST, INC. D/B/A PARAGON CABLE WHEREAS, on or about February 21, 1995, the Southwest Suburban Cable Commission of which the City of Eden Prairie is a member, received a letter and Form 394 from KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, the current franchisee of the cable system in Eden Prairie, stating that Houston Industries Incorporated which wholly owns KBLCOM, Inc. which holds KBL Cable, Inc. which holds KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, proposes to transfer control of KBLCOM, Inc. to Time Warner Inc. ("Time Warner"); and WHEREAS, the federal Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992, states that: 1) a cable operator cannot transfer a cable system unless it has held the system at least thirty-six (36) months unless the transfer meets a stated exception; and 2) if a cable transfer or sale requires franchising authority approval, the franchising authority has 120 days from receipt of the Form 394 to approve the sale; and WHEREAS, the City of Eden Prairie with the assistance of the Southwest Suburban Cable Commission has determined that the cable system was held for at least thirty-six (36) months; and WHEREAS, the federal Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992 allows the City to review the legal, technical and fmancial qualifications of the transferee; and WHEREAS, the Minnesota Cable Communications Act and Article X1I, Section 1, Subsection B of the cable franchise ordinance for the City of Eden Prairie state that a franchising authority which receives a written request for approval of a sale or transfer shall answer in writing within thirty (30) days of the request and shall state whether it approves the request or whether it determines that a public hearing is necessary because the sale or transfer may adversely affect the subscribers; and - 1 - WHEREAS, the Minnesota Cable Communications Act and the cable franchise ordinance for the City of Eden Prairie state that if a public hearing is deemed necessary, such hearing shall be conducted within thirty (30) days of such determination and notice of such a hearing shall be given fourteen (14) days before such hearing by publishing notice once in a newspaper of general circulation in the area served by the franchise; and WHEREAS, the City of Eden Prairie passed a Resolution on March 21, 1995 stating that it is examining the effect of the proposed transfer on its residents and a public hearing is necessary; and WHEREAS, the City of Eden Prairie gave appropriate notice and held such a public hearing on April 18, 1995 and concluded such hearing on June 6, 1995 and received no express opposition to the transfer; and WHEREAS, Article XII, Section 1, Subsection G of the cable franchise ordinance for the City of Eden Prairie states that the City of Eden Prairie may inquire into the qualifications of the prospective controlling party, and the Grantee shall assist the City in such an inquiry and pay all costs incurred by the City in so inquiring, including City staff time at a value determined by the City; and WHEREAS, Time Warner, KBLCOM, Inc. and the City disagree regarding the responsibility for reimbursement of consultant's fees for the review of the transfer of ownership; and WHEREAS, pursuant to Article M of the cable franchise ordinance for the City of Eden Prairie, the Minnesota Cable Communications Act and the federal Cable Communications Policy Act of 1984, as amended by the Cable Television Consumer Protection and Competition Act of 1992, the City of Eden Prairie has up to 120 days to exercise its right to purchase the system at the bona fide purchase price in the offer; and WHEREAS, the City of Eden Prairie has examined its right to purchase the system; and WHEREAS, the Southwest Suburban Cable Commission has assisted the City in reviewing the legal, technical and financial qualifications of the prospective transferee as well as the franchisee's compliance with the current franchise, and has provided a recommendation regarding the approval of the proposed transfer of ownership; and WHEREAS, during the review of the legal, technical and financial qualifications of Time Warner and KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable's current compliance with the franchise ordinance, the Southwest Suburban Cable Commission noted that the City's Relief Ordinance No. 37-91, will expire, at the City's option, with the proposed transfer or sale of the cable system; and - 2 - r WHEREAS, Time Warner has indicated that it does not believe that the transfer of control of KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable to Time Warner constitutes a transaction which will cause the Relief Ordinance to expire, at the City's option; and WHEREAS, representatives of Time Warner Inc. have represented to the Southwest Suburban Cable Commission that the transfer of control of the cable system will not change previous representations by representatives of KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable that upon negotiation of an acceptable early renewal they intend to upgrade the channel capacity: NOW, THEREFORE, the City of Eden Prairie resolves as follows: 1. The City of Eden Prairie acknowledges that it has the right to purchase the cable system pursuant to Article M of the cable franchise ordinance for the City of Eden Prairie. The City has examined this right and determined that exercise of the right to purchase, given the nature of the transaction (which does not change the local grantee and management), is not warranted. The City will waive this right for this transfer between Houston Industries Incorporated and Time Warner Inc. The City does not waive this right for any future transfer or sale. 2. The City, with the assistance of the Southwest Suburban Cable Commission, has reviewed the legal, technical and financial qualifications of Time Warner Inc. to control the franchisee which operates the cable system and has determined that Time Warner Inc. has the legal, technical and financial qualifications to operate the system. 3. . The City, with the assistance of the Southwest Suburban Cable Commission, has reviewed the effect of the proposed transfer on its residents. Based upon the assertions of Time Warner Inc. that such a transfer will not affect the plans to upgrade the channel capacity upon negotiation of an acceptable early renewal, the City of Eden Prairie has determined that the proposed transfer will not negatively impact its residents. 4. The City approves the transfer of control of KBLCOM, Inc. from Houston Industries Incorporated to Time Warner Inc. as set forth in the Stock Purchase Agreement, under the franchise, based upon Time Warner Inc.'s execution of the Acceptance Agreement which is attached hereto as Exhibit 1 within thirty (30) days of the adoption of this Resolution or within thirty (30) days after the closing of the transfer of control, whichever is later. - 3 - S 5. The City, with the assistance of the Southwest Suburban Cable Commission, has reviewed the Relief Ordinance and KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable's Acceptance of Ordinance Relief Ordinance dated July 17, 1992 and determined that it has the option to terminate those documents as a result of this transfer. The City will extend the terms of that Ordinance and Agreement until December 31, 1995. At that time the City will have the right to exercise its right to terminate that Ordinance and Agreement and any action taken at that time will be retroactive to the date that this Resolution is entered. 6. The City grants the authority to the Southwest Suburban Cable Commission to evaluate the City's legal rights to terminate the relief agreement and the impact of termination of the Relief Ordinance including its applicability to discussion regarding an early renewal and a system upgrade to increase channel capacity. 7. The City grants the Southwest Suburban-Cable Commission the authority to enter into negotiations with KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable that may lead to an early renewal of the franchise and an upgrade and/or rebuild of the cable system. 8. KBLCOM, Inc. and KBL Cable, Inc. must execute a Reaffirmation of their Consent Agreement and Guaranty of Performance which is attached hereto as Exhibit 2 within thirty (30) days of the adoption of this Resolution or within thirty (30) days after the closing of the transfer of control, whichever is later. 9. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable must execute a Reaffirmation of Acceptance of a Franchise for a Cable Television System which is attached hereto as Exhibit 3 within thirty (30) days of the adoption of this Resolution or within thirty (30) days after the closing of the transfer of control, whichever is later. 10. The Southwest Suburban Cable Commission, the City, KBLCOM, Inc. and Time Warner disagree regarding reimbursement of consultant's fees for the review of the transfer of control. The City accepts the settlement reached by the Southwest Suburban Cable Commission and KBLCOM, Inc. in which KBLCOM, Inc. will pay fifty (50) percent of the consultant's fees and the Southwest Suburban Cable Commission will pay fifty (50) percent. - 4 - t` BE IT FURTHER RESOLVED, that the City Clerk is directed to send a copy of this Resolution to KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, Time Warner Inc., KBL Cable, Inc. and KBLCOM, Inc. A motion to approve the foregoing Resolution No. �- // , was made by Council Member and duly seconded by Council Member The following Council Members voted in the affirmative: The following Council Members voted in the negative: Passed and adopted this day of /Ie , 1995. ATTEST: Title: e: ayor 't erk 420982 - 5 - EXIHBIT 1 TDvE WARNER INC. ACCEPTANCE OF CABLE TELEVISION FRANCHISE ORDINANCE AND CONDITIONS OF A TRANSFER OF CONTROL OF THE CABLE SYSTEM ("ACCEPTANCE AGREEMENT") THIS ACCEPTANCE AGREEMENT, is made by Time Warner Inc. ("Time Warner"), on , 1995. Recitals: 1. On or about February 21, 1995, the Cities of the Southwest Suburban Cable Commission ("SWSCC"), Eden Prairie, Edina, Hopkins, Minnetonka. and Richfield, received a letter and Form 394 from KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, the current franchisee of the cable system, stating that Houston Industries Incorporated which wholly owns KBLCOM, Inc. which holds KBL Cable, Inc. which holds KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, proposes to transfer control of KBLCOM, Inc. to Time Warner Inc. ("Time Warner"). 2. Time Warner has requested the City's approval of a transfer of control of the cable franchise, granted by the Ordinance. 3. The City intends to approve Time Warner's request for a transfer of control of the cable franchise, subject to Time Warner's acceptance of the conditions as set forth herein and the Cable Television Franchise Ordinance and any amendments thereto. 4. The City, with the assistance of the Southwest Suburban Cable Commission, reviewed the Relief Ordinance which the City enacted on December 3, 1991 and KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agreed to through the Acceptance of Ordinance No. 37-91 which KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable signed on July 17, 1992. The City has stated that it has the option to terminate this Agreement and Ordinance as a result of this transfer of control. Time Warner has indicated that it does not believe that the City has the right to terminate the Agreement and Ordinance because of this transfer of control. The City has stated that it will extend the time in which to exercise its right to terminate the Relief Ordinance until December 31, 1995, however, any action taken at that time will be retroactive to the date that the City approved Resolution No. approving the transfer. - 1 - J 5. Time-Warner understands that the transfer of control of the franchise and the approval by the cities of the Southwest Suburban Cable Commission, is based on requirements under federal, state and local law. Those requirements have been fulfilled through review by the SWSCC and recommendations made by it to the cities based on information furnished to the SWSCC by Time-Warner and its representatives. Most of the information which was relied upon by the SWSCC was furnished pursuant to FCC Form 394. oAcceptance: 1. Time Warner agrees that after the proposed transfer of control the franchise holder will continue to be bound by the Ordinance and to timely and fully perform all of the duties and obligations thereunder. 2. Time Warner agrees that after the proposed transfer of control the franchise holder will provide to the City and its subscribers all lawful services as required in the Cable Television Franchise Ordinance. 3. Time Warner agrees that after the proposed transfer of control the franchise holder will be subject to the lawful regulatory authority of the City as set forth in the Ordinance as may be amended from time to time hereafter. 4. Time Warner agrees that after the proposed transfer of control the franchise holder will cooperate fully with the City and obtain from any governmental agency all licenses, permits, and other authority necessary for lawful operation and maintenance of its Cable Television System (the "System") under the Cable Television Franchise Ordinance. 5. Time Warner has indicated that it does not believe that the City has the right to purchase the cable system pursuant to the language set forth in Article M of the cable franchise ordinance. Time Warner acknowledges, however, that the City has stated that it will waive any right for this transaction between Houston Industries Incorporated and Time Warner. Time Warner acknowledges that the City has not waived that right for any future transfer or sale. 6. Time Warner represents and warrants as follows: a. The management, finances and operations of KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will not negatively change as a result of the change in control of ownership. b. There will not be an adverse impact to subscribers because of the change in control of ownership. - 2 - C. The change in control of ownership will not alter, delay, or change plans, if any, to accomplish an upgrade of the cable television system capacity and to work with the SWSCC during 1995 to negotiate an early renewal. Time Warner is not bound to agree to an early renewal or agree to upgrade the system as a result of this representation. d. That after this transfer of control is completed KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will be a corporation duly organized, validly existing, and in good standing under the laws of the State of Minnesota and will have all rights and authority necessary to enter into and fully perform all of the duties and obligations of the Grantee. e. That it has taken all action necessary to authorize the execution and delivery of this Acceptance Agreement and the full performance of all the duties and obligations of the franchise holder under the Ordinance. f. That after this transfer of control is completed, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will have the legal, technical, and financial ability to operate and maintain the System pursuant to the terms of the Ordinance. g. That this Acceptance Agreement is binding on Time Warner and the Franchise Ordinance is binding on KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, to the extent not inconsistent with State or Federal law. 7. Time Warner agrees that all representations, warranties, and agreements contained herein and in the Ordinance shall survive the execution of this Acceptance Agreement and shall be binding upon Time Warner's permitted successors and assigns. 8. Notwithstanding anything to the contrary, the City and Time Warner reserve all rights under federal, state, and local law. 9. This Acceptance Agreement shall be effective only upon the closing of the transaction referred to in Paragraph 1 of the Recitals transferring control of KBLCOM, Inc. to Time Warner Inc. Time Warner Inc. By Its - 3 - STATE OF ) ss. COUNTY OF ) On this day of , 1995, before me, a notary public within and for County, appeared , who stated that she/he was the of Time Warner Inc. and that she/he executed the foregoing document as her/his free act and deed on behalf of said corporation. Notary Public 420982 - 4 - EDIT 2 KBLCOM, INC. AND KBL CABLE, INC. REAFFIRMATION OF CONSENT AGREEMENT AND GUARANTY OF PERFORMANCE REGARDING THE CABLE TELEVISION FRANCHISE ORDINANCE AND CONDITIONS OF A TRANSFER OF CONTROL OF THE CABLE SYSTEM ("REAFFIRMATION OF CONSENT AND GUARANTY") THIS REAFFIRMATION OF CONSENT AND GUARANTY IS MADE BY KBLCOM, INC. AND KBL CABLE, INC. ON , 1995. Recitals: 1. On or about February 21, 1995, the Cities of the Southwest Suburban Cable Commission ("SWSCC"), Eden Prairie, Edina, Hopkins, Minnetonka and Richfield, received a letter and Form 394 from KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, the current franchisee of the cable system, stating that Houston Industries Incorporated which wholly owns KBLCOM, Inc. which holds KBL Cable, Inc. which holds KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, proposes to transfer control of KBLCOM, Inc. to Time Warner Inc. ("Time Warner"). 2. Time Warner has requested the City's approval of a transfer of control of the cable franchise which is granted by the Ordinance. 3. The City intends to approve Time Warner's request for a transfer of control of the cable franchise, subject to Time Warner's acceptance of the conditions set forth in its Acceptance Agreement and the Cable Television Franchise Ordinance and any amendments thereto. As part of its approval, the City requests that KBLCOM, Inc. and KBL Cable, Inc. provide a reaffirmation of the Consent Agreement and Guaranty of Performance which they entered in 1988. 4. KBLCOM, Inc. and KBL Cable, Inc. understand that the City's approval of the transfer of control of the franchise is based on requirements under federal, state and local law. Those requirements have been fulfilled through review by the SWSCC and recommendations made by it to the City based on information furnished to the SWSCC by Time Warner and its representatives. Most of the information which was relied upon by the SWSCC was furnished pursuant to FCC Form 394. - 1 - Acceptance: 1. KBLCOM, Inc. and KBL Cable, Inc. agree that after the proposed transfer of control, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will continue to be bound by the Ordinance and to timely and fully perform all of the duties and obligations thereunder. 2. KBLCOM, Inc. and KBL Cable, Inc. agree that after the proposed transfer of control, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will provide to the City and its subscribers all lawful services as required in the Cable Television Franchise Ordinance. 3. KBLCOM, Inc. and KBL Cable, Inc. agree that after the proposed transfer of control, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will be subject to the lawful regulatory authority of the City as set forth in the Ordinance as may be amended from time to time hereafter. 4. KBLCOM, Inc. and KBL Cable, Inc. agree that after the proposed transfer of control, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will cooperate fully with the City and obtain from any governmental agency all licenses, permits, and other authority necessary for lawful operation and maintenance of its Cable Television System (the "System") under the Cable Television Franchise Ordinance. , 5. KBLCOM, Inc. and KBL Cable, Inc. have indicated that they do not believe that the City has the right to purchase the cable system pursuant to the language set forth in Article XI of the cable franchise ordinance. KBLCOM, Inc. and KBL Cable, Inc. acknowledge, however, that the City has stated that it has the right to purchase the cable system as set forth in Article XI of the cable franchise ordinance and the City will waive that right for this transfer between Houston Industries Incorporated and Time Warner. KBLCOM, Inc. and KBL Cable, Inc. acknowledge that the City does not waive that right for any future transfer or sale. 6. KBLCOM, Inc. and KBL Cable, Inc. represent and warrant as follows: a. The management, finances, and operations of I BL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will not negatively change as a result of the change in control of ownership. b. There will not be an adverse impact to subscribers because of the change in control of ownership. - 2 - C. The change in control of ownership will not alter, delay, or change plans, if any, to accomplish an upgrade of the cable television system capacity and to work with the SWSCC during 1995 to negotiate an early renewal. KBLCOM, Inc. and KBL Cable, Inc. are not bound to agree to an early renewal or agree to upgrade the system as a result of this representation. d. That after this transfer of control is completed KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will continue to be a corporation duly organized, validly existing, and in good standing under the laws of the State of Minnesota and will have all rights and authority necessary to enter into and fully perform all of the duties and obligations of the Grantee. e. That each has taken all action necessary to authorize the execution and delivery of this reaffirmation of Consent Agreement and Guaranty of Performance and the full performance of all the duties and obligations of the franchise holder under the Ordinance. f. That after this transfer of control is completed, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will continue to have the legal, technical, and financial ability to operate and maintain the System pursuant to the terms of the Ordinance. g. That this reaffirmation of Consent Agreement and Guaranty of Performance is binding on KBLCOM, Inc. and KBL Cable, Inc. and the Franchise Ordinance is binding on KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, to the extent not inconsistent with State or Federal law. 7. KBLCOM, Inc. and KBL Cable, Inc. agree that all representations, warranties, and agreements contained herein and in the Ordinance shall survive the execution of this reaffirmation of Consent Agreement and Guaranty of Performance and shall be binding upon their permitted successors and assigns. 8. Notwithstanding anything to the contrary, the City, KBLCOM, Inc. and I BL Cable, Inc. reserve all rights under federal, state, and local law. IN WITNESS WHEREOF, KBLCOM, Inc. and KBL Cable, Inc. warrant that they reaffirm the Consent Agreement and Guaranty of Performance and guarantee all obligations imposed by this franchise, that they agree to be jointly and severally liable to the franchising - 3 - authority for actions, inactions, omissions, violations and failure of compliance as a result of the granting of, acceptance of, and continuation of this franchise. KBLCOM, INC. By Its STATE OF ) ss. COUNTY OF ) On this day of , 1995, before me, a notary public within and for County, appeared , who stated that she/he was the of KBLCOM, Inc. and that she/he executed the foregoing document as her/his free act and deed on behalf of said corporation. Notary Public KBL CABLE, INC. By Its STATE OF ) ss. COUNTY OF ) On this day of , 1995, before me, a notary public within and for County, appeared , who stated that she/he was the of KBL Cable, Inc. and that she/he executed the foregoing document as her/his free act and deed on behalf of said corporation. Notary Public 420982 - 4 - rJ EXHIBIT 3 KBL CABLESYSTEMS OF THE SOUTHWEST, INC. D/B/A PARAGON CABLE REAFFIRMATION OF ACCEPTANCE OF A FRANCHISE FOR A CABLE TELEVISION SYSTEM AND CONDITIONS OF A TRANSFER OF CONTROL OF THE CABLE SYSTEM ("REAFFIRMATION OF ACCEPTANCE") THIS REAFFIRMATION OF ACCEPTANCE IS MADE BY KBL CABLESYSTEMS OF THE SOUTHWEST, INC. D/B/A PARAGON CABLE ON 51995. Recitals: 1. On or about February 21, 1995, the Cities of the Southwest Suburban Cable Commission ("SWSCC"), Eden Prairie, Edina, Hopkins, Minnetonka. and Richfield, received a letter and Form 394 from KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, the current franchisee of the cable system, stating that Houston Industries Incorporated which wholly owns KBLCOM, Inc. which holds KBL Cable, Inc. which holds KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable, proposes to transfer control of KBLCOM, Inc. to Time Warner Inc. ("Time Warner"). 2. Time Warner has requested the City's approval of a transfer of control of the cable franchise which is granted by the Ordinance. 3. The City intends to approve Time Warner's request for a transfer of control of the cable franchise, subject to Time Warner's acceptance of the conditions set forth in its Acceptance Agreement and the Cable Television Franchise Ordinance and any amendments thereto. As part of its approval, the City requests that KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable provide a reaffirmation of the Acceptance of a Franchise for a Cable Television System it entered in 1988. _ 4. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable understands that the City's approval of the transfer of control of the franchise is based on requirements under federal, state and local law. Those requirements have been fulfilled through review by the SWSCC and recommendations made by it to the City based on information furnished to the SWSCC by Time Warner and its representatives. Most of the information which was relied upon by the SWSCC was furnished pursuant to FCC Form 394. - 1 - r= Acceptance: 1. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agrees that it will continue to be bound by the Ordinance and to timely and fully perform all of the duties and obligations thereunder. 2. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agrees that it will provide to the City and its subscribers all lawful services as required in the Cable Television Franchise Ordinance. 3. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agrees that it will be subject to the lawful regulatory authority of the City as set forth in the Ordinance as may be amended from time to time hereafter. 4. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agrees that it will cooperate fully with the City and obtain from any governmental agency all licenses, permits, and other authority necessary for lawful operation and maintenance of its Cable Television System (the "System") under the Cable Television Franchise Ordinance. 5. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable has indicated that it does not believe that the City has the right to purchase the cable system pursuant to the language set forth in Article XI of the cable franchise ordinance. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable acknowledges, however, that the City has stated that it has the right to purchase the cable system as set forth in Article M of the cable franchise ordinance and the City will waive that right for this transfer between Houston Industries Incorporated and Time Warner. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable acknowledges that the City does not waive that right for any future transfer or sale. 6. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable represents and warrants as follows: a. The management, finances, and operations of KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable will not negatively change as a result of the change in control of ownership. b. There will not be an adverse impact to subscribers because of the change in control of ownership. C. The change in control of ownership will not alter, delay, or change plans, if any, to accomplish an upgrade of the cable television system capacity and to work with the SWSCC during 1995 to negotiate an - 2 - rs early renewal. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable is not bound to agree to an early renewal or agree to upgrade the system as a result of this representation. d. That after this transfer of control is completed it will continue to be a corporation duly organized, validly existing, and in good standing under the laws of the State of Minnesota and will have all rights and authority necessary to enter into and fully perform all of the duties and obligations of the Grantee. e. That it has taken all action necessary to authorize the execution and delivery of this reaffirmation of Acceptance and the full performance of all the duties and obligations of the franchise holder under the Ordinance. f. That after this transfer of control is completed, it will continue to have the legal, technical, and financial ability to operate and maintain the System pursuant to the terms of the Ordinance. g. That this reaffirmation of Acceptance and the Franchise Ordinance is binding on it, to the extent not inconsistent with State or Federal law. 7. KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable agrees that all representations, warranties, and agreements contained herein and in the Ordinance shall survive the execution of this reaffirmation of the Acceptance and shall be binding upon its permitted successors and assigns. 8. Notwithstanding anything to the contrary, the City and KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable reserve all rights under federal, state, and local law. IN WITNESS WHEREOF, KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable reaffirms its Acceptance of a Franchise for a Cable Television System and accepts all obligations imposed by this franchise, that it is liable to the franchising authority for actions, inactions, omissions, violations and failure of compliance as a result of the granting of, acceptance of, and continuation of this franchise. - 3 - �j. KBL CABLESYSTEMS OF THE SOUTHWEST, INC. D/B/A PARAGON CABLE By Its STATE OF ) ss. COUNTY OF ) On this day of , 1995, before me, a notary public within and for County, appeared , who stated that she/he was the of KBL Cablesystems of the Southwest, Inc. d/b/a Paragon Cable and that she/he executed the foregoing document as her/his free act and deed on behalf of said corporation. Notary Public 420982 - 4 - APPENDIX B