(a) Within ten days after formal execution of the contract, the Company shall establish a letter of credit for ten thousand dollars ($10,000) with a local bank. The form and content of the letter of credit shall be approved by the Village Solicitor. The letter of credit shall be used to insure the faithful performance by the Company of all provisions of this chapter and the contract; and compliance with all orders, permits and directions of any agency, commission, board, department, division or office of the Village having jurisdiction over its acts or defaults under the contract, and the payment by the Company of any claims, liens and taxes due the Village or other municipalities which arise by reason of the construction, operation or maintenance of the system.
(b) The letter of credit shall be maintained at ten thousand dollars ($10,000) during the entire term of the service contract, even if amounts have to be withdrawn pursuant to subsections (a) or (c) hereof.
(c) If the Company fails to pay to the Village any compensation within the time fixed herein; or, fails, after fifteen days' notice to pay to the Village any taxes due and unpaid; or fails to repay the Village within fifteen days, any damages, costs or expenses which the Village is compelled to pay by reason of any act or default of the Company in connection with this chapter and the contract; or, fails, after ten days notice of such failure by the Company, to comply with any provision of this chapter and the contract which the Mayor reasonably determines can be remedied by demand on the letter of credit, (including those for which penalties are provided in Section 737.41), the Mayor may immediately request payment of the amount thereof, with interest and any penalties, from the letter of credit. Upon such request for payment, the Village shall notify the Company of the amount and date thereof.
(d) The rights reserved to the Village with respect to the letter of credit are in addition to all other rights of the Village, whether reserved by this chapter, the contract or authorized by law, and no action, proceeding or exercise of a right with respect to such letter of credit shall effect any other right the Village may have.
(Ord. 12-83. Passed 2-15-83.)