(A) Grantor may require grantee to provide a security fund, in an amount and form established in the franchise agreement. The amount of the security fund shall be established based on the extent of the grantee's obligations under the terms of the franchise.
(B) The security fund shall be available to grantor to satisfy all claims, liens and/or taxes due grantor from grantee which arise by reason of construction, operation, or maintenance of the system, and to satisfy any actual or liquidated damages arising out of a franchise breach, subject to the procedures and amounts designated in the franchise agreement.
(C) If the security fund is drawn upon by grantor in accordance with the procedures established in this chapter and the franchise agreement, grantee shall cause the security fund to be replenished to the original amount no later than 30 days after each withdrawal by grantor. Failure to replenish the security fund as required under this section shall be deemed a material breach of the franchise.
(D) Grantee shall retain all rights to litigate any of the actions taken by grantor in drawing upon the security fund.
(Ord. 912, passed 6-8-00)