Common use of Construction Bond Clause in Contracts

Construction Bond. (a) Prior to being approved for an initial installation of a system, the Grantee shall file with the Village a construction bond in the amount of not less than 110 percent of the costs to install the System in the service area contained in the application or renewal proposal in favor of the Village. This bond shall be maintained throughout the construction period and until such time as determined by the Village, unless specified in the franchise agreement. (b) Prior to being approved for an upgrade of the system that involves significant excavation or other disturbance of Public Way, the Grantee shall file with the Village a performance bond in the amount of not less than $100,000.00. This bond shall be maintained throughout the upgrade period and until such time as determined by the Village, unless specified in the franchise agreement. (c) If the Grantee fails to diligently pursue and complete the construction required for the installation or upgrade of its cable system, or fails to well and truly observe, fulfill and perform each term and condition of this chapter or of the franchise as it relates to construction, installation or upgrade of the system, then there shall be recoverable jointly and severally, from the principal and surety of the bond, the cost of completing such construction and any damages or loss suffered by the Village as a result, including the full amount of any compensation, indemnification, or cost of removal or abandonment of any property of the Grantee, plus a reasonable allowance for attorney's fees, including the Village's legal staff, and costs, up to the full amount of the bond. This Section shall be an additional remedy for any and all violations outlined in Subsection 14(e). (d) The bond shall contain the following endorsement: "It is hereby understood and agreed that this bond may not be canceled by the surety nor the intention not to renew be stated by the surety until 45 days after receipt by the Village, by registered mail, a written notice of such intent to cancel or not to renew." (e) Upon receipt of a 45-day notice, this shall be construed as default granting the Village the right to demand payment on the bond. (f) The Village, at any time during the term of this chapter, may, in writing, waive or reduce Grantee's requirement to maintain a performance bond.