A. In the event that a letter of credit is required pursuant to the franchise agreement, a grantee shall deposit with the city a letter of credit from a financial institution chosen by the grantee and reasonably approved by the city in the amount set by the city. The letter of credit may be replaced by the grantee, but may not otherwise be revoked or terminated during the term of a franchise plus an additional 60 days except with written approval of the city. The letter of credit shall be used to ensure the faithful performance by a grantee of all provisions of the franchise and this chapter, compliance with all orders, permits, and directions of any agency, commission, board, department, division, or office of the city having jurisdiction over its acts or default under the license, and the payment by the grantee of any fees, costs, claims, liens, liquidated damages, and taxes due the city which arise by reason of the construction, operation, or maintenance of the system, or breach or termination of a franchise.

B. The letter of credit shall contain an endorsement that provides that the letter of credit may not be canceled by the surety nor the intention not to renew be stated by the surety until 60 days after receipt by the city clerk, by certified mail, of a written notice of such intention to cancel or not to renew.

C. At its option, the city may draw against the letter of credit for any unpaid liquidated damages, penalties, franchise fees or other amounts owing to it under a franchise which are 30 days or more past due.

D. The rights reserved to the city with respect to the letter of credit are in addition to all other rights of the city, whether reserved by this chapter or related documents or authorized by law, and no action, proceeding or exercise of a right with respect to such letter of credit shall affect any other right the city may have. (Ord. 5531 § 2, 2004.)