§ 25.19. Letter of Credit.

A.

Within thirty (30) days after the award of a Franchise, the Grantee shall deposit with the City a letter of credit from a financial institution in the amount of Twenty-Five Thousand Dollars ($25,000). The form and content of such letter of credit shall be approved by the City Attorney. The letter of credit shall be used to insure the faithful performance by the Grantee of all provisions of the Franchise and this ordinance; and compliance with all orders, permits, and directions of any agency, commission, board, department, bureau or office of the City having jurisdiction over its acts or defaults under the Franchise Agreement or this ordinance, and the payment by the Grantee of any penalties, claims, liens and taxes due the City or other governmental entities which arise by reason of the construction, operation, maintenance, repair or upgrade of the System.

B.

If the Grantee fails to pay to the City any compensation due the City within the time fixed herein; or, fails, after ten (10) days notice to pay to the City any amounts due and unpaid; or fails to repay the City within ten (10) days, any damages, costs or expenses which the City is compelled to pay by reason of any act or default of the Grantee in connection with the Franchise; or, fails, after three (3) days notice of such failure by the Grantee to comply with any provision of the Franchise Agreement or this ordinance which the City reasonably determines can be remedied by demand on the letter of credit, the City may immediately request payment of the amount thereof, with interest and any penalties, from the letter of credit. Upon such request for payment, the City shall notify the Grantee of the amount and date thereof.

C.

The letter of credit shall be maintained at Twenty-Five Thousand Dollars ($25,000) during the entire term of the Franchise. In the event that amounts are withdrawn pursuant to Paragraph A or B of this section, the Grantee, shall take any action required to maintain the letter of credit at said full amount within three (3) days of the notification by the City of its withdrawal against the letter of credit.

D.

The rights reserved to the City with respect to the letter of credit are in addition to all other rights of the City, whether reserved by this ordinance, the Franchise Agreement or authorized by law, and no action, proceeding or exercise of a right with respect to such letter of credit shall affect any other right the City may have.

E.

The letter of credit shall contain the following endorsement: "It is hereby understood and agreed that this letter of credit shall not be cancelled by the surety nor the intention not to renew be stated by the surety until thirty (30) days after receipt by the City, by registered mail, of a written notice of such intention to cancel or not to renew."

(Ord. of 1-7-1985, Doc. #19125; Ord. of 9-23-1996, Doc. #29666)