§ 13. FORFEITURE OR REVOCATION.

(a)

The Council reserves the right to revoke the franchise granted hereunder and rescind all rights and privileges associated with the franchise in the following circumstances, each of which shall represent a default and breach under this franchise.

(1)

If the Grantee shall default in the performance of any of the material obligations under this franchise or under such document, contacts [contracts] and other terms and provisions entered into by and between the City and the Grantee;

(2)

If the Grantee shall fail to provide or maintain in full force and effect the liability and indemnification coverage or the performance bond as required herein pursuant to the franchise agreement.

(3)

If the Grantee's construction schedule is delayed later than the schedule contained in the franchise agreement, if any, or beyond any extended date set by the Council;

(4)

If the Grantee becomes insolvent or unable to pay its debts or is adjudged bankrupt;

(5)

If the Grantee fails to restore service after ninety-six (96) consecutive hours of interrupted "system-wide" service, except when such service interruption is caused by forces beyond the Grantee's control (including but not limited to subscribers), or when approval of such interruption is obtained from the Mayor, or his designee;

(6)

If there has been intentional material misrepresentation of fact in the application for or negotiation of the franchise or any extension of renewal thereof.

(b)

The Grantee shall not be declared at fault or be subject to any sanction under any provision of this franchise in any case in which performance of any such provision is prevented for reasons beyond the Grantee's control. A fault shall not be deemed to be beyond the Grantee's control if committed by a corporation or other business entity in which the Grantee holds a controlling interest, whether held directly or indirectly.

(c)

Procedure prior to revocation.

(1)

In the event the City believes that the grounds for revocation exist or have occurred, the City shall notify the Grantee in writing noting the facts on which such belief is grounded. The City shall make written notice, by certified mail, return-receipt requested, that the Grantee comply with any such requirement, limitation, term, condition, rule or regulation or correct any action deemed cause for revocation. If, within thirty (30) days following said written notice, Grantee has not furnished reasonably satisfactory evidence that corrective action has been taken or is being actively and expeditiously pursued, or that the alleged violation did not occur, or that the alleged violation, except those involving financial matters were beyond the Grantee's control, the City shall provide the Grantee an opportunity to present evidence, at a public hearing, that the just cause or non-compliance identified in the written notice has been remedied or that the significance thereof does not warrant revocation. City shall cause to be served upon the Grantee, at least thirty (30) days prior to the date of such public hearing, a written notice of this intent to request such revocation, and the time and place of the meeting, notice of which shall be published by the City Clerk, in accordance with North Carolina state law, before such meeting, in a newspaper of general circulation within the City.

(2)

The Council shall hear any persons interested therein, including the Grantee, and shall determine in its discretion whether or not any failure, refusal or neglect by the Grantee was with just cause.

(3)

If such failure, refusal or neglect by the Grantee was with just cause, as defined by the City, the Council shall direct the Grantee to comply within such time and manner and upon such terms and conditions as are reasonable.

(4)

If the Council shall determine such failure, refusal or neglect by the Grantee was without just cause, then the Council shall, by resolution, declare that the franchise of the Grantee shall be revoked, unless there is compliance by the Grantee within ninety (90) days.

(d)

In the event this franchise is revoked or otherwise terminated, the City may, under the provisions of existing federal, state or local laws and at its sole discretion, do any of the following:

(1)

Purchase the system, at fair market price; or

(2)

Effect a transfer of ownership of the system to another party for good and sufficient consideration; or

(3)

Order the removal of all system facilities from the City within a reasonable period of time.

(e)

In removing its system facilities, the Grantee shall refill, at its own expense, any excavation that shall be made by it and shall leave all public ways and places in as good a condition, normal wear and tear excepted, as was prevailing prior to the Grantee's removal of system facilities. The City shall inspect and approve the condition of the public ways and public places and cables, wires, attachments and poles after removal. The liability, indemnity, insurance and performance bond as provided herein shall continue in full force and effect during the period of removal and until full compliance by the Grantee with the terms and conditions of this paragraph, this franchise and the franchise agreement is reached.

(f)

In the event of a failure by the Grantee to complete any work required by this franchise agreement or any other required by the City law or ordinance, and upon reasonable notice to the Grantee, the City may cause such work to be done and the Grantee shall reimburse the City the reasonable costs thereof within thirty (30) days after verification of an itemized list of such costs. The City shall be permitted to seek legal and equitable relief to enforce the provisions of this section.

(g)

Upon either the non-renewal or revocation of a franchise, the City may contract with the Grantee to continue to operate the system for a period of six (6) months from the date of such expiration or revocation, or until such time as it mutually agreed upon. The Grantee shall, as a subcontractor of the City, continue to operate the cable communications system under the applicable terms and conditions of this franchise. The City shall be permitted to seek legal and equitable relief to enforce the provisions of this section.