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01/08/2007 In reserving such rights, the City confirms that the Franchisee is materially in compliance with the provisions of the Franchise and there exists no fact or circumstance known to the City which constitutes, or which, with the passage of time or the giving of notice or both, would constitute a material default or breach under the Franchise or would allow the City to cancel or terminate the rights hereunder, except upon the expiration of the full term of the Franchise. 3. The transfer is expressly contingent upon Transferee reimbursing the City for the consultant's costs incurred in the processing of the request for transfer, not to exceed the maximum amount of $20,000 indicated in the "Change of Ownership Consent Agreement" attached to this Resolution as Exhibit A. Said reimbursement shall be provided within thirty (30) calendar days of Franchisee's receipt of an itemized invoice detailing the consultant's costs. 4. All terms of the Franchise agreement remain in full force and effect, including all terms contained in City of Redwood City actions dated September 16, 2004 (Amendment #1) amending and clarifying certain terms of the Franchise. 5. The Franchise agreement allows the City to require Franchisee to provide up to two (2) additional Public, Educational and Governmental ("PEG") access channels. These two (2) PEG access channels will be in addition to the two (2) PEG access channels currently provided. Transferee agrees to activate and provide one additional PEG access channel by not later than April 20, 2007. This access channel may be located on Transferee's digital service tier. No sooner than twenty four months after the incumbent cable operator implements a third PEG channel and following receipt of one hundred twenty (120) days advance written notice, the Transferee shall provide a fourth PEG channel. This channel may be located on Transferee's digital tier of service. Transferee shall not be required to carry the third and fourth PEG Channels on the Basic Service tier until Transferee converts its entire System to a digital format. 6. Transferee shall evidence acceptance of these conditions by signing a copy of the "Change of Ownership Consent Agreement," in substantially the same form as attached to this Resolution as Exhibit A, containing the conditions provided to Transferee and submitting the same to the City Clerk within sixty (60) calendar days of this approval. If Transferee fails to submit a signed copy of the "Change of Ownership Consent Agreement" to the City Clerk within said sixty (60) day period, or otherwise refuses to accept the conditions placed on the proposed transfer set forth herein, A TTY/RESO/RESO.1676 010407 14758 Formerly Muff # 801 -3-