FLOOD00634

• County: Larimer
• Community: Wellington
• Title: Appendix A Construction Fund Loan Application
• Date: 12/19/1989
• Prepared For: Wellington
• Prepared By: Consultants
• Floodplain - Doc Type: Community File

I. Thc Contractor and the Surety'. jointly and 'ieverally. bind them5clves.
their heirs, executors. administrators, successors and assigns to the Owner
for the performance of the Construction Contract. which is incorporated
herein by reference.

2. If the Contractor performs (he Construction Contract. the Surety and
the Contra\.:!or shall have no obligation under this Bond, except to par-
ticipate in conferences as provided in Subparagraph 3.1.

3. If there is no Owner Default, the Surety's obligation under this Bond
shall arise after:
J. I. The Owner has notified the Contractor and the Surety at its address
described in Paragraph 10 below, that the Owner is considering
declaring a Contractor Default and has requested and attempted
to arrange a conference with the Contractor and the Surety to be
held not later than fifteen days after receipt of such notice to
discuss methods of performing the Construction Contract. If the
Owner, the Contractor and {he Surety agree. the Contractor shall
be allowed a reasonable time to penorm the Construction Con4
tract, but such an agreement shall not waive the Owner's right, if
any, subsequently to declare a Contractor Default: and
3.2. The Owner has declared a Contractor Default and formally ter-
minated the Contractor's right to complete the contract. Such
Contractor Default shall not be declared earlier than twenty days
after the Contractor and the Surety have received notice as pro-
vided in Subparagraph 3.1; and
3.3. The Owner has agreed to pay the Balance of the Contract Price
to the Surety in accordance with the terms of the Construction
Contract or to a contractor selected to perform the Construction
Contract in accordance with the terms of the contract with the
Owner.

4. When the Owner has satisfied the conditions of Paragraph 3, the Surety
shall promptly and at the Surety's expense take one of the following
actions:
4.1. Arrange for the Contractor, with consent of the Owner. to perform
and complete the Construction Contract; or
4.2. Undertake to perform and complete the Construction Contract
itself, through its agents or through independent contractors; or
4.3. Obtain bids or negotiated proposals from qualified contractors
acceptable to the Owner for a contract for performance and co014
pletion of the Construction Contract, arrange for a contract to be
prepared for execution by the Owner and the contractor selected
",ith the Owner's concurrence. to be secured with performance
and payment bonds executed by a qualified surety equivalent to
the bonds issued on the Construction Contract, and pay to the
Owner the amount of damages as described in Paragraph 6 in
excess of the Balance of the Contract Price incurred by the Owner
resulting from the Contractor's default; or

4.4. Waive its right to perform and complete. arrange for completion,
or obtain a new contractor and with reasonable promptness under
the circumstances:
I. After investigation. determine the amount for which it may be
liable to the Owner and, as soon as practicable after the amount
is determined, tender payment therefor to the Owner; or
2. Deny liability in whole or in part and notify the Owner citing
reasons therefor.

5. If the Surety doe.. not proceed as provided in Paragraph 4 with reason-
able promptness. the Surety shall be deemed to be in default on this Bond
fifteen days after receipt of an additional written notice from the Owner
to the Surety demanding that the Surety perform its obligations under this
Bond. and the Owner shall be entitled to enforce any remedy available to
the Owner. If the Surety proceeds as provided in Subparagraph 4.4, and
the Owner refuses the payment tendered or the Surety has denied liability,
in whole or in part. without further notice the Owner shall be entitled to
enforce any remedy' available to the Owner.

6, After the Owner has terminated the Contractor' ~ right to complete the
Construction Contract, and if the Surety elects to act under Subparagraph
4.1,4.2. or 4.3 above, then the r.espoosibilities of the Surety to the Owner
shall not be greater than those of the Contractor under the Construction
Contract. and the responsibilitie~ of the Own~r to the Surely shall not be (
greater than tho~e of the Owner under the Con..,trudion Contract. To the \..
limit of the amount of this Bond, but subject to commitment by the Owner
of the Balance of the Contract Price to mitigation of costs and damages
on the Construction Contract. the Surety is obligated without duplication
for:
6.1. The responsibilities of the Contractor for correction of defective
work and completion of the Construction Contract;
6.2. Additional legal. design professional and delay costs resulting
from the Contractor's Default. and resulting from the actions or
failure to act of the Surety under Paragraph 4; and
6.3. Liquidated damages. or if no liquidated damages are specified in
the Construction Contract. actual damages caused by delayed
performance or nonMperformance of the Contractor.
7. The Surety shall not be liable to the Owner or others for obligations of
the Contractor that are unrelated to the Construction Contract, and the
Balance of the Contract Price shall not be reduced or set off on account
of any such unrelated obligations. No right of action shaH accrue on this
Bond to any person or entity other than the Owner or its heirs, executors.
administrators, or successors.
8. The Surety hereby waives notice of any change, including changes of
time, to the Construction Contract or to related subcontracts. purchase
orders and other obligations.
9. Any proceeding, legal or equitable, under this Bond may be instituted
in any court of competent jurisdiction in the location in which the work
or part of the work is located and shall be instituted within two years after
Contractor Default or within two years after the Contractor ceased workM
ing or within two years after the Surety refuses or fails to perform its
obligations under this Bond. whichever occurs first. If the provisions of
this Paragraph are void or prohibited by law, the minimum period of
limitation available to sureties as a defense in the jurisdiction of the suit
shall be applicable.
10. Notice to the Surety, the Owner or the Contractor shall be mailed or
delivered to the address shown on the signature page.
II. When this Bond has been furnished to comply with a statutory ore
other legal requirement in the location where the construction was to be
performed. any provision in this Bond conflicting with said statutory or
legal requirement shall be deemed deleted herefrom and provisions COOM
forming to such statutory or other legal requirement shall be deemed
incorporated herein. The intent is that this Bond shall be construed as a
statutory bond and not as a common law bond.
12. Definitions.
12.1. Balance of the Contract Price: The total amount payable by the
Owner to the Contractor under the Construction Contract after
all proper adjustments have been made, including allowance to
the Contractor of any amounts received or to be received by
the Owner in settlement of insurance or other claims for dam-
ages to which the Contractor is entitled. reduced by all valid
and proper payments made to or on behalf of the Contractor
under the Construction Contract.
12.2. Construction Contract: The agreemen1 hctween the Owner and
the Contractor identified on the ~ign,lture page, including all
Contract Documents and changes thereto.
12.3. Contractor Default: Failure of the Contractor, which has neither
been remedied nor waived, to perform ur otherwise to comply
with the terms of the Construction Contract.
12.4. Owner Default: Failure of the Owner, which has neither been
remedied nor waived, to pay the Contractor as required by the
Construction Contract or to perform and complete or comply
with the other terms thereof.

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(FOR INFORMATION ONLY-Name, Address ar.u Telephone)
AGENT or BROKER: OWNER'S REPRESENTATIVE (Architect, Engineer or other party):

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