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1. The Contractor and Surety,jointly and severally,bind themselves,their heirs,executors,administrators,successors
<br /> and assigns to the Owner for the pedonnance of the Construction Contract, which Is Incorporated herein by
<br /> reference.
<br /> 2. If the Contractor performs the Construction Contract,the Surety and the Contractor shall have no obligation under
<br /> this Bond,except when applicable to participate in a conference as provided to Section 3.
<br /> 3. If there is no Owner Default under the Construction Contract the Surety's obligation under this Bond shall arise
<br /> after.
<br /> .I the Owner Bust provides notice to the Contractor and the Surety that the Owner is considering declaring a
<br /> Contractor Default. Such notice small indicate whether the Owner is requesting a conftretm among the
<br /> Owner, Contractor and Surety to discuss the Contractor's perfomunce. If the Owner does not request a
<br /> conference,the Surety may,within five(5)business days after receipt of the Owner's notice,request such a
<br /> conference, If the Surety timely requests a eonferatee, the Owner sball attend. Unless, the Owner agrees
<br /> otherwise,any conference requested under this Section 3.1 shall be held within ten(10)business days of the
<br /> Surety's receipt of the Owners notice. If the Owner,the Contractor and the Surety agree,the Contractor shall
<br /> be allowed a reasonable time to perform the Construction Contract,but such an agreement shall not waive the
<br /> Owners right,if any,subsequently to declare a Contractor Default;
<br /> .2 the Owner declares a Contractor Default,terminates the Construction Contract and notifies the Surety,and
<br /> .3 the Owner has agreed to pay the Balance of the Contract Price in accordance with the terms of the
<br /> Construction Contract to the Surety or to a contractor selected to perform the Construction Contract.
<br /> 4. Failure on the part of the Owner to comply with the notice requirement in Section 3.1 shall not constitute a failure
<br /> to comply with a condition precedent to the Suret}�s obligations,or release the Surety from its obligations,except
<br /> to the extent the Surety demonstrates actual prejudice.
<br /> 5. When the Owner has satisfied the conditions of Section 3,the Surety shall promptly and at the Surety's expense
<br /> take one of the following actions:
<br /> 5.1 Arrange for the Contractor,with the consent of the Owner,to perform and complete the Construction Contract;
<br /> 5.2 Undertake to perform and complete the Construction Contract itself;through its agents or independent contractors;
<br /> 5.3 Obtain bids or negotiated proposals from qualified contractors acceptable to the Owner for a contract for
<br /> performance and completion of the Construction Contract,arrange for a contract to be prepared for execution by
<br /> the Owner and a contractor selected with the Owner's concurrence,to be secured with performance and payment
<br /> bonds executed by a qualified surety equivalent to the bonds issued on the Construction Contract,and pay to the
<br /> Owner the amount of damages as described in Section 7 in excess of the Balance of On Contract
<br /> Price incurred by the Owner as a result of the Contractor Default;or
<br /> SA Waive its right to perform and complete,arrange for completion,or obtain a new contractor and with reasonable
<br /> promptness under the circumstances:
<br /> .1 Ater investigation, determine the amount for which it may be liable to the Owner and,as soon as
<br /> practicable after the amount is determined,make payment to the Owner;or
<br /> .2 Deny liability in whole or in part and notify the Owner,citing the reasons for denial.
<br /> 6. If the Surety does not proceed as provided in Section 5 with reasonable promptness,the Surety shall be deemed to
<br /> be in default on this Bond seven days after receipt of an additional written notice from the Owner to the Surety
<br /> demanding that the Surety perform its obligations under this Bond,and the Owner shall be entitled to enforce any
<br /> remedy available to the Owner. If the Surety proceeds as provided in Section SA,and the Owner refuses the
<br /> payment tendered or the Surety has denied liability,in whole or in part,without further notice the Owner shall be
<br /> entitled to enforce any remedy available to the Owner.
<br /> 7. If the Surety elects to act under Section 5.1.5.2,or 5.3,then the responsibilities of the Surety to the Owner shall
<br /> not be greater than those of the Contractor under the Construction Contract,and the responsibilities of the Owner
<br /> to the Surety shall not be greater than those of the Owner under the Construction Contract. Subject to the
<br /> UrVage confamr to AU Docnmau A312 Pertommom Road,2010 edition.
<br /> PRF76MZ7A71 if
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