A.
Performance bond. Upon the effective date of the franchise,
the grantee shall obtain and maintain during the entire term of the franchise
and any extensions and renewals thereof, at its cost and expense, and file
with the borough a corporate surety bond in such sum as specified in the franchise
agreement to guarantee the faithful performance by the grantee of all its
obligations provided under this chapter and the franchise agreement. Failure
to timely obtain, file and maintain said bond shall constitute a substantial
violation within the meaning of this section.
B.
Conditions. The performance bond shall provide the following
conditions:
(1)
There shall be recoverable by the borough jointly and
severally from the principal and surety any and all fines and liquidated damages
due to the borough, as specified in the franchise agreement, and any and all
damages, losses, costs and expenses suffered or incurred by the borough resulting
from the failure of the grantee to faithfully comply with the provisions of
this chapter and the franchise agreement; comply with all orders, permits
and directive of any borough agency or body having jurisdiction over its acts
or defaults; pay fees due to the borough; pay any claims, liens or taxes due
the borough which arise by reason of the construction, operation, maintenance
or repair of the cable communication system. Such losses, costs and expenses
shall include, but not be limited to, attorney's fees and other associated
expenses.
(2)
The total amount of the bond shall be forfeited in favor of the borough in the event that the borough revokes the franchise pursuant to § 39-13 for the two following reasons:
(a)
The grantee abandons the cable communication system at
any time during the term of the franchise or any extension thereto; or
(b)
The grantee assigns the franchise without the express
written consent of the borough, provided that the grantee has been notified
of such noncompliance in writing by the borough and has failed to cure the
same within 30 days.
C.
Reduction of bond. Upon written application by the grantee,
the borough may, at its sole option, permit the amount of the bond to be reduced
or waive the requirements for a performance bond subject to the conditions
set forth below. Reductions granted or denied upon application by the grantee
shall be without prejudice to the grantee's subsequent applications or
to the borough's right to require the full bond at any time thereafter.
D.
Letter of credit. If requested by the borough in lieu
of the performance bond required by this section, the grantee shall obtain,
maintain and file with the borough an irrevocable letter of credit from a
financial institution licensed to do business in the state in any amount specified
in the franchise agreement, naming the borough as beneficiary. The form and
contents of such letter of credit shall be approved by the borough and shall
be released only upon expiration of the franchise and upon the replacement
of the letter of credit by a successor grantee. Failure to obtain the letter
of credit within the time specified herein shall constitute a substantial
violation within the meaning of this chapter.
E.
Use of performance bond or letter of credit. Prior to
drawing upon the letter of credit or the performance bond for the purposes
described in this section, the borough shall notify the grantee in writing
specifying the item for which payment is claimed and the date it was due.
The grantee shall have 10 days from the receipt of such written notice to
make a full and complete payment. If the grantee does not make the payment,
the borough may withdraw the amount thereof, with interest and penalties,
from the letter of credit or the performance bond.
F.
Notification. Within three days of a withdrawal from
the letter of credit or performance bond, the borough shall send to the grantee,
by certified mail, return receipt requested, written notification of the amount,
date and purpose of such withdrawal.
G.
Replenishment of letter of credit or performance bond. No later than 30 days after mailing to the grantee by certified mail notification of a withdrawal pursuant to Subsection F above, the grantee shall replenish the letter of credit or performance bond in an amount equal to the amount so withdrawn. Failure to make timely replenishment of such amount to the letter of credit or performance bond shall constitute a substantial violation of this chapter.
H.
Nonrenewal, alteration or cancellation of letter of credit
or performance bond. The performance bond or letter of credit required herein
shall be in a form satisfactory to the borough and shall require 30 days'
written notice of any nonrenewal, alteration or cancellation to both the borough
and the grantee. The grantee shall, in the event of any such cancellation
notice, obtain, pay all premiums for and file with the borough written evidence
of the issuance of replacement bond or letter of credit within 30 days following
receipt by the borough or the grantee of any notice of cancellation.
I.
To offset the effects of inflation, the amounts of the
bond or letter of credit provided for herein are subject to reasonable increases
at the end of every three-year period of the franchise, applicable to the
next three-year period, upon the determination of the borough.
A.
Within 10 days after the effective date of a franchise
agreement, the grantee shall deposit with the grantor and maintain on deposit
through the term of this franchise, in cash, such sum as specified in the
franchise agreement, as security for the payment of any fees, liquidated damages
or penalties imposed under this chapter. Said sum shall be placed by the grantor
in an interest-bearing account.
B.
Within 10 days after notice to the grantee that any amount has been withdrawn from the security fund deposited pursuant to Subsection A of this section, the grantee shall pay to or deposit with the grantor a sum of money or securities sufficient to restore such security fund to the original amount as specified in the franchise agreement.
C.
The security fund deposited pursuant to this section
shall become the property of the grantor in the event that this franchise
is canceled by reason of default of the grantee. The grantee, however, shall
be entitled to the return of such security fund or portion thereof as remains
on deposit with the grantor at the expiration of the term of this franchise,
provided that there is then no outstanding default on the part of the grantee.
D.
The rights reserved to the grantor with respect to the
security funds are in addition to all other rights of the grantor, whether
reserved by this chapter or authorized by law, and no action, proceeding or
exercise of a right with respect to such security funds shall affect any other
right the grantor may have.
A.
Within 30 days after the effective date of the franchise
agreement and thereafter continuously through the duration of the franchise
and any extensions or renewals thereof, the grantee shall furnish to the borough
certificates of insurance, approved by the borough, for all types of insurance
required under this section. Failure to furnish said certificates of insurance
in a timely manner shall constitute a violation of this chapter.
B.
Any insurance policy obtained by the grantee in compliance
with this section shall be filed and maintained with the borough during the
term of the franchise and may be changed from time to time to reflect changing
liability limits and/or to compensate for inflation. The grantee shall immediately
advise the borough of any litigation that may develop that would affect this
insurance.
C.
Neither the provisions of this section or any damages
recovered by the borough hereunder shall be construed to or limit the liability
of the grantee under any franchise issued hereunder or for damages.
D.
All insurance policies maintained pursuant to this chapter
or the franchise agreement shall contain the following, or a comparable, endorsement:
"It is hereby understood and agreed that this insurance policy may not be
canceled by the insurance company nor the intention not to renew be stated
by the insurance company until 30 days after receipt by the Borough Manager,
Borough Secretary or his designee, by registered mail, of a written notice
of such intention to cancel or not to renew."
E.
All insurance policies maintained pursuant to this chapter
or the franchise agreement shall name the borough as an additional insured.
F.
All insurance policies provided under the provisions
of this chapter or the franchise agreement shall be written by companies authorized
to do business in the state and approved by the State Insurance Commission.
G.
At any time during the term of the franchise, the borough
may request and the grantee shall comply with such request to name the borough,
all elected borough officials and borough employees with cable-related responsibilities
as additional named insured for all insurance policies written under the provisions
of this chapter or the franchise agreement.
H.
To offset the effects of inflation and to reflect changing
liability limits, all of the coverages, limits and amounts of the insurance
provided for herein are subject to reasonable increases at the end of every
three-year period of the franchise, applicable to the next three-year period,
upon the determination of the borough by resolution.
I.
General liability insurance. The grantee shall maintain
and by its acceptance of any franchise granted hereunder specifically agrees
that it will maintain throughout the term of the franchise general liability
insurance insuring the grantee for a minimum of $25,000,000 for all damage,
injury, accident or death.
J.
Libel and allied torts. The grantee shall maintain a
libel and allied torts insurance policy in an amount specified in the franchise
agreement.
K.
Such general liability insurance must include coverage
for all of the following: comprehensive form, premises operations, explosion
and collapse hazard, underground hazard, products/completed operations hazard,
contractual insurance, broad-form property damage and personal injury.
L.
Motor vehicle liability insurance. The grantee shall
maintain and by its acceptance of any franchise granted hereunder specifically
agrees that it will maintain throughout the term of the franchise motor vehicle
liability insurance for owned, nonowned or rented vehicles in the minimum
amount of:
M.
Workers' compensation and employer's liability
insurance. The grantee shall maintain and by its acceptance of any franchise
granted hereunder specifically agrees that it will maintain throughout the
term of the franchise workers' compensation and employer's liability,
valid in the state, in the minimum amount of:
A.
To the fullest extent permitted by law, the grantee shall,
at its sole cost and expense, fully indemnify, defend and hold harmless the
borough, its officers, public officials, boards and commissions, agents and
employees from and against any and all lawsuits, claims (including, without
limitation, workers' compensation claims against the borough or others),
causes of action, actions, liability and judgments for injury or damages (including,
but not limited to, expenses for reasonable legal fees and disbursements assumed
by the borough in connection therewith):
(1)
To persons or property, in any way arising out of or
through the acts or omissions of the grantee, its subcontractors, agents or
employees.
(2)
Arising out of any claim for invasion of the right of
privacy, for defamation of any person, firm or corporation or the violation
or infringement of any copyright, trademark, trade name, service mark or patent
or any other right of any person, firm or corporation, but excluding claims
arising out of or related to borough programming or programming for which
the grantee is not legally responsible.
(3)
Arising out of grantee's failure to comply with
the provisions of any federal, state or local statute, ordinances or regulation
applicable to the grantee in its business hereunder.
(4)
Arising out of any action or claim related to obscenity,
indecency or sexually explicit programming.
B.
The foregoing indemnity is conditioned upon the following:
the borough shall give the grantee prompt notice of any claim or the commencement
of any action, suit or other proceeding covered by the provisions of this
section. Nothing herein shall be deemed to prevent the borough from cooperating
with the grantee and participating in the defense of any litigation by its
own counsel at its own costs and expense.
