§ 21. PERFORMANCE BOND.

(a)

Performance bond. No later than forty-five (45) days after 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 City a corporate surety bond, in the amount of $25,000, to guarantee the faithful performance of the Grantee of all its obligations provided under this franchise. Failure to timely obtain, file and maintain said bond shall continue [constitute] a substantial violation of this franchise.

(b)

Conditions. The performance bond shall provide the following conditions:

(1)

There shall be recoverable by the City, jointly and severally from the principal and surety, any and all fines and penalties due to the City and any and all damages, losses, costs and expenses suffered or incurred by the City resulting from the failure of the Grantee to: faithfully comply with the provisions of this franchise; comply with all applicable orders, permits and directives of any City agency or body having jurisdiction over its acts or defaults; per any claims, liens or taxes due the City, which arise by reason of the construction, operation, maintenance or repair of the cable system.

(2)

The total amount of the bond shall be forfeited in favor of the City in the event:

a.

The Grantee abandons the cable system at any time during the term of the franchise or any extension thereto;

b.

The Grantee assigns the franchise without the express written consent of the City not including affiliate transfers as defined in this ordinance.

c.

Reduction of bond. Upon written application by the Grantee, the City may, at its sole option, permit the amount of the bond to be reduced or waive the requirements for a performance bond. Reductions granted or denied upon application by the Grantee shall be without prejudice to the Grantee's subsequent applications or to the City's right to require the full bond at any time thereafter. However, no application shall be made by the Grantee within ninety (90) days of any application.

d.

Use of performance bond. Prior to drawing upon the performance bond for the purposes described in this section the City shall notify the Grantee in writing that payment is due, and the Grantee shall have thirty (30) days from the receipt of such written notice to make a full and complete payment of undisputed amounts. If the Grantee does not make the payment within thirty (30) days, the City may withdraw the amount thereof from the performance bond.

e.

Notification. Within thirty (30) days of a withdrawal from the performance bond, the City shall send to the Grantee, by certified mail, return receipt requested, written notification of the amount, data [date] and purpose of such withdrawal.

f.

Replenishment of performance bond. No later than thirty (30) days after receipt by the Grantee of certified mail notification of a withdrawal pursuant to paragraph (e) above, 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 franchise.

g.

Nonrenewal, alteration or cancellation of performance bond. The performance bond required herein shall be in a form satisfactory to the City and shall require thirty (30) days written notice of any nonrenewal, alteration or cancellation to both the City and the Grantee. The Grantee shall, in the event of any such cancellation notice, obtain, pay all premium for, and file with the City, written evidence of the issuance of a replacement bond within thirty (30) days following receipt by the City or the Grantee of any notice of cancellation.