§ 114.08 BONDS, INDEMNIFICATIONS, LIQUIDATED DAMAGES, INSURANCE.

(A) Security fund.

(1) Contemporaneously with an applicant's filing its acceptance of a franchise, it shall deposit with the city, and during the term of the franchise granted, maintain on deposit, a security fund in a sum set by the franchise. Funds from the security fund shall be utilized for the purposes provided in this chapter, and in each franchise.

(2) Within 15 days after written notice to a grantee by the city that the city has withdrawn any amount from its security fund, the grantee shall deposit with the city a sum of money sufficient to restore the security fund to the original amount as set by the franchise.

(3) If any grantee fails to pay the city any moneys due within the time fixed in this chapter or the franchise; or fails to pay to the city within ten days' written notice, any damages, costs or expenses which the city may be compelled to pay by reason of any act, omission or default of the grantee; or fails after ten days' written notice to comply with any provision of this chapter or its franchise which the city reasonably determines can be remedied or partially cured by an expenditure from the security fund, the city may immediately, without prior notice to grantee, withdraw the amount thereof from the security fund. Upon such withdrawal, the city shall in writing notify the grantee of the amount, date and purpose thereof. In the event the security fund is insufficient to pay and/or repay the city for its lawful costs, damages, or obligations incurred, any other funds or assets of the grantee, may be drawn upon by the city for any such amounts due the city.

(4) Each franchise issued pursuant hereto shall contain a liquidated damage provision, the terms of which shall be agreed upon by the city and the grantee. Sums due to city, as and for liquidated damages, shall be a proper charge against the security fund.

(5) A grantee shall be entitled to the return of all moneys remaining in the security fund, including any accrued interest, at the expiration or termination of its franchise, provided there is then no outstanding obligation owing on the part of the grantee to the city.

(6) The rights reserved to the city with respect to the security fund are in addition to all other rights of the city, whether reserved by this chapter, the franchise or authorized by law, and no action, proceeding or exercise of a right with respect to the security fund shall affect any other right the city may have.

(B) Hold harmless agreement.

(1) Each grantee in its acceptance of its franchise shall acknowledge and agree to indemnify and hold harmless the city, its officers, agents and employees, against and from any and all claims, demands, causes of action, actions, suits, proceedings, damages (including, but not limited to, damage to city property and damages arising out of copyright infringements, and damages arising out of any failure by grantee to secure consents from the owners or authorized distributors or licensees of programs delivered by grantee's system), costs or liabilities of every kind and nature whatsoever, including but not limited to, damages for injury or death of a person or damage to property, caused

by the act or omission of such grantee, its officers, agents, and employees in the exercise of its rights and privileges under its franchise.

(2) Definition. For the purpose of this division, the following definition shall apply.

COSTS OR LIABILITIES. Includes, but is not limited to, reasonable attorney fees, reasonable accountant fees, reasonable expert witness and consultant fees, reasonable per diem expenses and traveling expenses for witnesses, and court costs of any trial.

(C) Defense of litigation.

(1) Each grantee in its acceptance of its franchise shall acknowledge and agree, at the sole risk and expense of grantee, upon demand of the city, made by and through the City Attorney, to appear in and defend any and all suits, actions, or other legal proceedings, whether judicial, quasi-judicial, administrative, legislative, or otherwise, brought or instituted by third persons or duly constituted authorities, against or affecting the city, its officers, agents or employees, arising out of or pertaining to the exercise by such grantee of its rights and privileges under its franchise including, but not limited to, the act of granting such franchise by the city. Where the city determines, reasonably, that its interests are best served by appearing in the action or proceeding by and through its own counsel, it may do so at the grantee's sole expense.

(2) Grantee shall pay and satisfy or shall cause to be paid and satisfied any judgment, decree, order, directive, or demand rendered, made or issued against grantee, the city, its officers, agents or employees, in any of these premises; and such indemnity, as expressed in this section, shall exist and continue without reference to or limitation by the amount of any bond, policy of insurance, deposit, undertaking or other assurance required hereunder, or otherwise provided. No grantee shall make or enter into any compromise or settlement of any claim, demand, cause of action, action, suit, or other proceeding without first obtaining the written consent of the city, which consent shall not be unreasonably withheld.

(D) Expenses of litigation. In the event of any legal action between grantee and the city arising out of any alleged breach by grantee of any term of condition or provisions of this subchapter or the franchise, the prevailing party shall be entitled to reasonable attorney fees, and court costs related to the litigation.

(E) Insurance required.

(1) Not in derogation of a grantee's obligation pursuant to divisions (B) and (C) hereof, each grantee at all times during the term of its franchise, shall maintain in full force and effect, at its sole cost and expense, a general comprehensive liability insurance policy, including coverage for, premises operations, explosion and collapse hazard, underground hazard, contractual insurance, broad form property damage, independent contractors and personal injury and automobile liability comprehensive form. The City Manager shall have the right of approval as to coverages, companies and policy limits of all such policies.

(2) The city, its officers and employees, shall be named as additional insureds in all of the insurance policies. Where such insurance is provided by a policy which also covers grantee or any other entity or persons, it shall contain the standard cross-liability endorsement. These policies shall contain a provision that a written notice of cancellation or any alteration of the policy shall not be effective except upon 90 days prior written notice thereof to the city.

(3) Insurance policies required hereunder shall contain the following endorsements.

(a) The naming of an additional insured as herein provided shall not affect any recovery to which the additional insured would be entitled under this policy if not named as the additional insured.

(b) The additional insured named herein shall not be held liable for any premium or expense of any nature on this policy or any extension thereof.

(c) The additional insured named herein shall not by reason of being so named be considered a member of any mutual insurance company for any purpose whatsoever.

(d) Any other insurance held by the additional insured shall not be required to contribute anything toward any loss or expense covered by the insurance which is referred to by this certificate.

(4) Each grantee shall maintain during the term of its franchise, at its own cost and expense, a policy of Worker's Compensation Insurance, in minimum amounts as required by law.

(5) Each grantee shall, concurrently, with the filing of its acceptance of its franchise, and thereafter periodically during the term of its franchise, furnish to the City Clerk certificates of insurance evidencing the existence of insurance coverage required hereunder. Such certificates shall provide that the coverage may not be cancelled, substantially altered or terminated except upon 30-days written notice to the city.

(6) If a grantee fails to maintain any of the insurance coverage required hereunder, the city may, forthwith, terminate its franchise and/or obtain, at grantee's expense, such insurance coverage. ('83 Code, § 5.24.080) (Ord. 912, passed - -85) Penalty, see § 10.99