Town of New Castle, NY Article IV Performance Guaranties; Indemnification

§ 49-29 Performance bond.

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 town a corporate surety bond in an amount specified in the franchise to guarantee the faithful performance by the grantee of all its obligations provided under this chapter and the franchise. 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 town jointly and severally from the principal and surety any and all fines and liquidated damages due to the town and any and all damages, losses, costs and expenses suffered or incurred by the town resulting from the failure of the grantee to faithfully comply with the provisions of this chapter and the franchise; comply with all orders, permits and directives of any town agency or body having jurisdiction over its acts or defaults; pay fees due to the town; or pay any claims, liens or taxes due the town which arise by reason of the construction, operation, maintenance or repair of the cable 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 town in the event that:

(a) The grantee abandons the cable 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 town.

C. Reduction of bond. Upon written application by the grantee, the town 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 town's right to require the full bond at any time thereafter. However, no application shall be made by the grantee within one year of any prior application.

D. Conditions of reduction. The town may draw upon the performance bond if the grantee fails to faithfully comply with the provisions of this chapter and the franchise; comply with all orders, permits and directives of any town agency or body having jurisdiction over its acts or defaults; pay fees due to the town; or pay any claims, liens or taxes due the town which arise by reason of the construction, operation, maintenance or repair of the cable system.

E. Use of performance bond. Prior to drawing upon the performance bond for the purposes described in this section, the town shall notify the grantee, in writing, that payment is due, and the grantee shall have 30 days from the receipt of such written notice to make a full and complete payment. If the grantee does not make the payment within 30 days, the town may withdraw the amount thereof, with interest and penalties, from the performance bond.

F. Notification. Within three days of a withdrawal from the performance bond, the town 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 performance bond. No later than 30 days upon the resolution of the dispute which resulted in a withdrawal from the performance bond, the grantee shall replenish the performance bond in an amount equal to the amount so withdrawn. Failure to make timely replenishment of such amount to the performance bond shall constitute a substantial violation of this chapter.

H. Nonrenewal, alteration or cancellation of performance bond. The performance bond required herein shall be in a form satisfactory to the town and shall require 30 days' written notice of any nonrenewal, alteration or cancellation to both the town and the grantee. The grantee shall, in the event of any such cancellation notice, obtain, pay all premiums for and file with the town written evidence of the issuance of a replacement bond or policies within 30 days following receipt by the town or the grantee of any notice of cancellation.

§ 49-30 Liability and insurance.

A. Prior to commencement of construction but in no event later than 60 days after the effective date of the franchise and thereafter continuously throughout the duration of the franchise and any extensions or renewals thereof, the grantee shall furnish to the town certificates of insurance, approved by the town, 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. Certificates of insurance for policies obtained by the grantee in compliance with this section shall be filed and maintained with the Town Clerk 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.

C. Neither the provisions of this section or any damages recovered by the town hereunder shall be construed to or limit the liability of the grantee under any franchise issued hereunder or for damages.

D. All certificates of insurance furnished pursuant to this chapter or the franchise 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 Town Supervisor, by registered mail, of a written notice of such intention to cancel or not to renew."

E. All insurance policies provided under the provisions of this chapter or the franchise shall be written by companies authorized to do business in the state and approved by the State Board of Insurance.

F. The town shall be an additional insured for all insurance policies written under the provisions of this chapter or the franchise.

G. 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 town.

H. General liability insurance.

(1) 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 in the minimum of:

(a) One million dollars for property damage per occurrence.

(b) One million dollars for personal bodily injury or death to any one person.

(c) Five million dollars for excess liability in umbrella form.

(2) 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.

I. Automobile 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, automobile liability insurance for owned, nonowned or rented vehicles in the minimum amount of:

(1) One million dollars for bodily injury and consequent death per occurrence.

(2) One million dollars for bodily injury and consequent death to any one person.

(3) Five hundred thousand dollars for property damage per occurrence.

J. Worker's 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, worker's compensation and employer's liability valid in the state in the minimum amount of:

(1) The statutory limit for worker's compensation.

(2) One hundred thousand dollars for employer's liability.

§ 49-31 Indemnification.

A. To the fullest extent permitted by law, the grantee shall at its sole cost and expense fully indemnify, defend and hold harmless the town, its officers, public officials, boards and commissions, agents and employees from and against any and all lawsuits, claims (including, without limitation, worker's compensation claims against the town or others), causes of action, actions, liability and judgments for injury or damages (including but not limited expenses for reasonable legal fees and disbursements assumed by the town 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 to which the grantee's negligence shall in any way contribute and regardless of whether the town's negligence or the negligence of any other party shall have contributed to such claim, cause of action, judgment, injury or damage.

(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 town programming.

(3) Arising out of the grantee's failure to comply with the provisions of any federal, state or local statute, local laws or regulation applicable to the grantee in its business hereunder.

B. The foregoing indemnity is conditioned upon the following: The town 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. At all times, the town shall cooperate with the grantee and participate in the defense of any litigation. No recovery by the town of any sum by reason of the liquidated damages required by the franchise shall be subject to litigation by the grantee, except that any sum so received by the town shall be deducted from any recovery which the town might have against the grantee under the terms of this section.