Bond; amount; filing

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44174944-1749.  Bond; amount; filing

A.  Every dance studio shall file with the office of the secretary of state a bond or cash deposit in the amount of five thousand dollars in favor of the state of Arizona for the benefit of any person who after entering into a contract for dance studio lessons or other services with the dance studio is damaged by the failure of the dance studio to provide the services specified in the contract or by the failure of the dance studio to comply with the provisions of this article.  No suit may be commenced on the bond or deposit after the expiration of one year following the commission of the act on which the suit is based.  The surety bond or deposit shall be continuous in form and shall be conditioned that the total aggregate liability of the surety or deposit for all claims shall be limited to the face amount of the bond irrespective of the number of years the bond is in force.

B.  The surety bond required by subsection A shall be executed by the dance studio as principal with a corporation duly authorized to transact surety business in this state.  The surety on any bond required by this section may cancel said bond by giving notice of such cancellation to the secretary of state.  Upon receipt by the secretary of state of notice to cancel a bond, the secretary of state shall immediately notify the dance studio who is the principal on such bond of the effective date of cancellation and the dance studio must furnish a like bond or deposit within thirty days from the date the secretary of state mails said notice to the dance studio.  Notice to the dance studio shall be by certified mail in a sealed envelope, postage prepaid thereon, addressed to the latest address of record in the secretary of state's office.

C.  The deposit required by subsection A shall be deposited with the secretary of state and may be satisfied by any of the following:

1.  Certificates of deposit payable to the state treasurer issued by banks doing business in this state and insured by the federal deposit insurance corporation.

2.  Investment certificates or share accounts assigned to the state treasurer and issued by a savings and loan association doing business in this state and insured by the federal savings and loan insurance corporation.

3.  Cash deposited with the secretary of state for deposit with the state treasurer.

D.  No dance studio shall engage in business in this state unless it has such bond or deposit on file with the secretary of state. 441749

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