Prior to any cable system construction, upgrade
or other work in the streets, the township may require a franchisee
to establish in the township's favor a performance bond in an amount
specified in the franchise agreement or other authorization as necessary
to ensure the franchisee's faithful performance of the construction,
upgrade or other work. The amount of such performance bond shall be
equal to 10% of the total cost of the work, but shall not exceed $100,000
and shall be released upon substantial completion and formal proof
of performance of the system.
In the event that a franchisee subject to such
a performance bond fails to complete the cable system construction,
upgrade or other work in the streets in a safe, timely and competent
manner, in accord with the provisions of the franchise agreement,
there shall be recoverable, jointly and severally, from the principal
and surety of the bond, any damages or loss suffered by the township
as a result, including the full amount of any compensation, indemnification
or cost of removal or abandonment of any property of the franchisee
or the cost of completing or repairing the system construction, upgrade
or other work in the streets, plus a reasonable allowance for attorneys'
fees, up to the full amount of the bond. The township may also recover
against the bond any amount recoverable against the security fund
or surety bond where such amount exceeds that available under the
security fund or surety bond.
The franchise agreement shall specify that,
upon completion of the system construction, upgrade or other work
in the streets and payment of all construction obligations of the
cable system to the satisfaction of the township, the township shall
eliminate the bond or reduce its amount after a time appropriate to
determine whether the work performed was satisfactory, which time
shall be established, considering the nature of the work performed.
The township may subsequently require a new bond or an increase in
the bond amount for any subsequent construction, upgrade or other
work in the streets. In any event, the total amount of the bond shall
equal 10% of the cost of the work, but shall not exceed $100,000.
The performance bond shall be issued by a surety
with an A-1 or better rating of insurance in Best's Key Rating Guide,
Property/Casualty Edition, shall be subject to the approval of the
township and shall contain the following endorsement:
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"This bond may not be canceled or allowed to
lapse, until 120 days after receipt by the township, by certified
mail, return receipt requested, of a written notice from the issuer
of the bond of intent to cancel or not to renew."
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The rights reserved by the township with respect
to any performance bond established pursuant to this chapter are in
addition to all other rights and remedies the township may have under
this chapter, the franchise agreement or at law or equity.
