A franchise agreement may provide that, prior
to the franchise's becoming effective, the franchisee shall post with
the township a cash security deposit to be used as a security fund
to ensure the franchisee's faithful performance of and compliance
with all provisions of this chapter, the franchise agreement and other
applicable law and compliance with all orders, permits and directions
of the township and the payment by the franchisee of any claims, liens,
fees or taxes due the township which arise by reason of the construction,
operation or maintenance of the system. The amount of the security
fund shall be $100,000 during the construction phase and until the
franchisee services and contracts 20% of the township residents. This
fund requirement may be increased in an amount equal to the increase
in the consumer price index for the Philadelphia metropolitan area
using the year of this chapter as the base year.
In any franchise agreement entered into before
the effective date of this chapter, a franchisee may, if requested
by a franchise agreement, in lieu of the security fund, file and maintain
with the township a bond with an acceptable surety in the amount of
$100,000 to indemnify the township against any losses it may suffer
in the event that the franchisee fails to comply with one or more
of the provisions of its franchise. Said bond shall be obtained at
the sole expense of the franchisee and remain in effect for the full
term of the franchise plus an additional six months thereafter. The
franchisee and its surety shall be jointly and severally liable under
the terms of the bond for any damages or loss suffered by the township
as a result of the franchisee's nonperformance, including the full
amount of any compensation, indemnification or cost of removal of
any property of the franchisee in the event of default, and a reasonable
allowance for attorneys' fees and costs, up to the full amount of
the bond. The bond shall provide for 120 days' prior written notice
to the township of any intention on the part of the franchisee to
cancel, fail to renew or otherwise materially alter its terms. Neither
the filing of a surety bond with the township nor the receipt of any
damages recovered by the township thereunder shall be construed to
excuse faithful performance by the franchisee or limit the liability
of the franchisee under the terms of its franchise for damages, either
to the full amount of the bond or otherwise.
The rights reserved to the township with respect
to the security fund or an indemnity bond are in addition to all other
rights to the township, whether reserved by this chapter or authorized
by other law or the franchise agreement, and no action, proceeding
or exercise of a right with respect to such security fund or indemnity
bond will affect any other right the township may have.
The franchise agreement shall provide for the
procedures to be followed with respect to drawing upon the security
fund and surety bond.
The township shall have all immunity as afforded
by the Cable Act and applicable antitrust laws.
