INTERLOCAL AGREEMENT

THIS INTERLOCAL AGREEMENT (the "Agreement") is hereby entered into by, between, and among the TOWN OF KNIGHTDALE, a North Carolina municipal corporation ("Knightdale"); the TOWN OF WENDELL, a North Carolina municipal corporation ("Wendell"); and the TOWN OF ZEBULON, a North Carolina municipal corporation ("Zebulon"). Knightdale, Wendell, and Zebulon collectively shall be known as the "Parties".

 WITNESSETH

 WHEREAS, Knightdale, in cooperation with Wendell and Zebulon, currently provides community access television programming on a PEG Channel (as hereinafter defined) provided by Time Warner Entertainment/Advance-Newhouse Partnership, a New York general partnership ("Time Warner"), pursuant to certain franchise agreements between the Parties and Time Warner; and

 WHEREAS, the existing PEG Channel is known as "EWT22" or "East Wake Television 22"; and

 WHEREAS, the Parties are committed to the delivery of the highest possible level of community access television programming to the citizens of the Parties and residents of eastern Wake County; and

 WHEREAS, the Parties desire to formalize their existing practices of cooperation and expand the flexibility and terms relating to previous agreements for the joint funding and operations of community access television programming for the citizens of the Parties and residents of eastern Wake County; and,

 WHEREAS, the Parties desire to share the benefits and responsibilities involved in providing community access television programming for the citizens of the Parties and residents of eastern Wake County; and

 WHEREAS, the Parties desire to enter into this Agreement pursuant to Section 160A­460 et seq. of the North Carolina General Statutes authorizing interlocal agreements.

NOW THEREFORE, for and in consideration of the mutual promises and covenants contained in this Agreement, the sufficiency of which is hereby acknowledged, the Parties agree as follows:

 ARTICLE 1. Definitions.

 For all purposes of this Agreement, unless the context requires otherwise, the following capitalized and underlined terms shall have the following meanings:

 "Act" shall mean Session Law 2006-151 of the State of North Carolina titled "An Act to Promote Consumer Choice in Video Service Providers and to Establish Uniform Taxes for Video Programming Services" as signed into law by Governor Michael F. Easley on or about July 20, 2006 as subsequently codified in the North Carolina General Statutes and as subsequently amended.

 "East Wake Television" shall mean that PEG Channel or PEG Channels funded pursuant to this Agreement along with the appurtenant management and operations of said channel or channels.

 "Effective Date" shall mean the latest date of execution by anyone of the Parties as evidenced from the signature pages of this Agreement.

 "Expiration Date" shall mean 11:59 p.m. Eastern Time on that date marking the end of the Term.

 "PEG Channels" shall mean any public, educational, or governmental access channels provided to any or all Parties to this Agreement by Time Warner, its successors in interest, or other Cable System (as defined by the Act) providing Cable Service (as defined by the Act) within the jurisdictions of the Parties.

 "State" shall mean the State of North Carolina along with any agency of the State of North Carolina, including the e-NC Authority, charged with administering the provisions of the Act.

 "Term" shall mean collectively the Initial Term plus any Subsequent Terms created pursuant to this Agreement.

 ARTICLE 2. Joint Operations Agreement.

 2.1. Knightdale, Wendell, and Zebulon hereby agree and covenant that they shall jointly fund and operate East Wake Television pursuant to the terms of this Agreement.

 2.2. Initial Term. The term of this Agreement shall be three (3) years from the Effective Date (the "Initial Term").

 2.3. Subsequent Terms. The Parties agree and acknowledge that this Agreement may be terminated by anyone Party to this Agreement by Notice to the other Parties made no less than ninety (90) days prior to the then Expiration Date (the "Termination Right"). Should any Party exercise its Termination Right, this Agreement shall terminate upon the then-applicable Expiration Date. Should no Party exercise its Termination Right pursuant to this subsection, the Term shall automatically renew for an additional three (3) years measured from the end of the then-applicable Term (the "Subsequent Terms").

 2.4. Manager. Responsibility for the daily operations of East Wake Television shall be vested in a manager (the "Manager"). The Parties agree that Knightdale shall be the Manager under this Agreement. The Manager shall employ best efforts to perform the following duties and shall have the following authority to act on behalf of the Parties:

 2.4.1. Conform programming to the requirements set forth by Article 3 herein below;

 2.4.2. Monitor the status of receipts from funds allocated for East Wake Television from the PEG Channel Fund and other distributions made pursuant to the Act ("Act Funds");

 2.4.3. Expend receipts of Act Funds in accordance with restrictions imposed by the Act;

 2.4.4. Serve as chief liaison between the Parties and the appropriate State agencies, including e-NC Authority (the "Authority"), charged with administering the provisions of the Act.

 2.5. Meetings of Parties.

 2.5.1. Annual Meeting. The Parties shall meet once annually on or before April 15 of each year of the Term, to adopt a budget for East Wake Television (the "Annual Meeting"). Other purposes of the Annual Meeting may include the discussion and adoption of rules or policies governing the management, operations, programming, maintenance, or funding of East Wake Television.

 2.5.2. Other Meetings. For any of the purposes expressed by this Agreement and in recognition of the mutual benefits accruing to the Parties from the active coordination and cooperation of the Parties, in supplement to the Annual Meeting the Parties agree to meet from time to time, as is reasonable and necessary, to coordinate, discuss, decide, adopt, or amend rules or policies governing the management, operations, programming, or maintenance of East Wake Television.

 2.5.3. Voting. The Parties hereby designate their town managers, or each manager's designee, as the proper representative at meetings described by this Section 2.5. The adoption or amendment of any budget, rule, or policy of East Wake Television shall require the unanimous vote of the Parties.

 ARTICLE 3. Programming

 3.1. All programming provided on East Wake Television PEG Channels shall be non­commercial in nature.

 3.2. Programming shall be provided on the PEG Channels for not less than eight (8) hours per day, each day of the year.

 3.3. It is anticipated by the Parties that the Parties may wish to acquire additional PEG Channels during the Term. The Parties intend that any future-acquired PEG Channels be governed pursuant to this Agreement.

 ARTICLE 4. East Wake Television Funding

 4.1. Source of Funds. For the purpose of ensuring that adequate financial resources are available to accomplish the goals of the Parties, hereto, each of the Parties hereby commits individually and severally to making all best efforts reasonably necessary to financially support East Wake Television. Without limiting the foregoing, the Parties explicitly commit as follows:

4.1.1. For Fiscal Year 2006-07, each of the Parties individually shall certify to the State on or before March 15, 2007 the amount of cable franchise tax and subscriber fee revenue the Party imposed during the first six months of the 2006-07 fiscal year in accordance with the terms of the Act (ref. N.C. Gen. Stat. § 105-164A4I(c)).

 4.1.2. For subsequent years, each of the Parties individually shall certify to the State 01 or before July 15 of each year of Term the number of qualifying PEG Channels operated by the Parties.

 4.1.3. At the request of the Manager, the Parties shall apply, either individually or collectively as determined by the Manager, for any grant monies available to PEG Channels, including but not limited to the PEG Channel Fund established by the Act (ref. N.C. Gen. Stat. § 66-359).

 4.l.4. It is the expectation of the Parties that funds received in accordance with the provisions of the Act shall be sufficient to fund the operations and capital needs of East Wake Television. The Parties acknowledge, however, that from time to time the Manager may request from the Parties that additional funds be committed from the Parties' general funds for the benefit of East Wake Television. No provision of this Agreement is intended to obligate any Party to the expenditure of general funds for the purposes set forth by this Agreement.

 4.2. Use of Funds.

 4.2.1. Any funds received by a Party as a distribution under the Act from efforts made in accordance with Section 4.1 of this Article, shall be allocated as follows:

 4.2.1.1. Franchise Fees. Funds distributed annually to the Parties from subscriber fees, franchise fees, or other fees received pursuant to § 105-164.44I(c) - (d] shall be expended in accordance with the provisions of the Act (ref. § 105­-164.44(I)(e)).

 4.2.1.2. Supplemental PEG Support. Funds distributed annually to the Parties m Supplemental PEG Support shall be expended only for the operation and support of East Wake Television.

 4.2.1.3. PEG Channel Fund Grants. In accordance with the Act, funds distributed from the PEG Channel Fund and corresponding matching funds from the Parties shall be expended only for capital expenditures necessary to provide programming for East Wake Television.

 ARTICLE 5. Title to Property

 5.1. Title to all personal property, equipment, and inventory previously committed to East Wake Television shall remain in the Party or Parties owning such property immediately prior to the Effective Date. Title to any personal property, equipment, or inventories acquired during the Term for the benefit of East Wake Television shall be with Knightdale.

 5.2. Notwithstanding the foregoing paragraph, title to any permanently installed equipment or fixtures acquired during the Term shall be with the fee owner of the real property to which the installed equipment or fixtures are affixed.

 ARTICLE 6. Assets

 6.1. Knightdale may sell surplus assets of East Wake Television as necessary.  Funds received from the sell of surplus equipment shall be used for the operation of East Wake Television.

 6.2 Upon the dissolution of East Wake Television, the assets shall be sold as surplus and the proceeds shall be split evenly between the parties remaining at the time of dissolution.

 ARTICLE 7. Termination

 7.1. Except in accordance with the provisions of Section 2.3 hereinabove, no Party shall have the right to withdraw participation in this Agreement without the consent of all other Parties.

7.2. This Agreement shall not be terminated prior to the end of its Initial Term except by agreement of all Parties.

 ARTICLE 8. Miscellaneous Provisions

 8.1. Notices. Any notice, demand, consent, agreement, request or other communication required to be given, served, sent or obtained hereunder (a "Notice") must be in writing, and must be either (i) mailed by first-class mail, registered or certified, return-receipt requested, postage prepaid, (ii) hand delivered personally or by nationally recognized courier service, fees prepaid or (iii) transmitted by telecopy, addressed as follows:

 8.1.1. If to Knightdale:

Town of Knightdale
c/o Gary McConkey, Town Manager
950 Steeple Square Court
Knightdale, NC 27545
FAX: 919-217-2209

 8.1.2. If to Wendell:

Town of Wendell
c/o Town Manager
PO Box 828
Wendell, NC 27591
FAX: 919-365-9367

 8.1.3. If to Zebulon:

Town of Zebulon
c/o Rick Hardin, Town Manager
Zebulon Town Hall
100 N. Arendell Avenue
Zebulon, NC 2759
FAX: 919-269-6200

 8.1.4. Each party may designate by notice a new address to which any Notice thereafter may be given, served, or sent. Each Notice that is delivered in the manner described above will be deemed given and received for all purposes at the earlier of such time as it is delivered to the addressee (with the return-receipt, courier delivery receipt or telecopy answer-back confirmation being deemed conclusive evidence of such delivery) or such time as delivery is refused by the addressee upon presentation.

 8.2. Amendments. No modification or amendment of this Agreement will be valid or binding upon any Party unless in writing and signed by the Party against whom such modification or amendment is asserted.

 8.3. Entire Agreement. This Agreement constitutes the entire agreement between the Parties with respect to an interlocal agreement for the joint funding and operations of East Wake Television. All previous undertakings or agreements between the parties with respect to these matters are merged herein and superseded hereby. No representation, promise, or inducement not included herein shall be binding on any Party hereto.

 8.4. Transferability. No additional Parties shall be allowed to participate during the Initial Term of this Agreement. This Agreement shall not be transferred or assigned, either voluntarily or involuntarily. Any purported transfer or assignment of a Party's rights under this Agreement shall be null and void, and shall not transfer any rights, interest or title to the purported transferee.

 8.5. Interpretation. If there arises any issue regarding the intent of the Parties to this Agreement or the interpretation of any provision of this Agreement or any ambiguity arising from this Agreement, no presumption or burden of proof shall arise favoring or disfavoring any Party, and this Agreement shall not be strictly construed against any party. When the context in which a word is used in this Agreement indicates that such is the intent, a word in the singular number shall include the plural and vice-versa, and a word in the masculine gender shall include the feminine and neuter and vice-versa. Any use in this Agreement of any form of the verb "to include" means the word stated but not limited to. The paragraph headings or titles used in this Agreement are for convenience only, and shall not define, limit, extend or interpret the scope of this Agreement or any particular section, paragraph or provision of this Agreement. Any reference in this Agreement to any statute, code, rule or law (collectively or individually, a "Law") shall include any amendments to the Law referred to, any comparable successor Law that replaces the Law referred to, as well as any amendments to any such successor Law.

 8.6. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina without giving effect to any conflict of law rule or provision thereof that would cause the application of the laws of any other jurisdiction.

 8.7. Faxed Signatures. Any Party to this Agreement transmitting its signature on this Agreement by telecopy shall be deemed to have accepted and adopted such telescoped signature as that Party's original signature, and to have accepted that the same is sufficient to bind that party to this Agreement as if that Party's original handwritten signature were attached hereto, it being the intention of the Parties that a telescoped signature on this Agreement is binding from the time a copy of this Agreement with a party's signature is telescoped to another party hereto, and that any person may rely on the authority thereof for implementing the provisions of this Agreement.

 8.8. Severability. The Parties intend that this Agreement be enforced to the fullest extent permissible under the Law and public policy applied by any jurisdiction in which enforcement is sought. Accordingly, if any provision, sentence, phrase or word of this Agreement, or the application thereof to any person or circumstance, or the enforceability thereof in any jurisdiction, is held invalid, the remainder of this Agreement, or the application of such provision, sentence, phrase or word to persons or circumstances other than those as to which it is held invalid, or the enforceability thereof in other jurisdictions, shall not be affected thereby.

 8.9. Agreement in Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same instrument. In addition, this Agreement may contain more than one counterpart of the signature pages, and this Agreement may be executed by the affixing of the signatures of each of the Parties to one of such counterpart signature pages. All of such signature pages shall be read as though one and they shall have the same force and effect as though all of the signers had signed a single signature page.

      8.11. Other Documents. The Parties agree to execute such other documents as may be necessary for the implementation and consummation of this Agreement and the covenants contained herein.

      8.12. Force Majeure. If either party is delayed or hindered in or prevented from the performance of any act required under this Agreement by reason of strike, lockouts, labor troubles, power failure, riots, insurrection, war, fire, earthquake, flood, explosion, governmental sanctioned embargo, acts of God, inclement weather or other reason beyond such party's control of like or unlike nature or cause, then performance of such act shall be excused for the period of the delay, and the period for the performance of any such act shall be extended for a period equivalent to the period of such delay.

      8.13. Third-party Beneficiaries. Except as may be otherwise expressly provided herein, this Agreement shall not confer any rights or remedies upon any person or entity other than the Parties hereto, and their respective successors and permitted assigns.

 8.14. Injunctive Relief. The Parties acknowledge that any breach or violation of this Agreement will cause irreparable harm to the non-breaching Parties for which there is no adequate remedy at Law. Accordingly, in addition to any other remedies available at law or equity, any Party hereto that is aggrieved by a breach or threatened breach of any of the provisions of this Agreement shall be entitled to seek from any court of competent jurisdiction an order for specific performance and/or for temporary and/or permanent injunctive relief to enforce the provisions of this Agreement without the necessity of proving actual damages or posting bond or other security.