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March 1, 1995 <br />Article 42. STATES RIGHT TO DO THE WORK <br />If the Contractor should neglect to prosecute the work properly or fail to perform any provision of the <br />Contract, the Principal Representative, after seven (7) days' written notice to the Contractor and the <br />Surety may, without prejudice to any other remedy he may have, make good such deficiencies and . <br />may deduct the cost thereof from the payment then or thereafter due the Contractor. <br />Article 43. STATE'S RIGHTS TO TERMINATE THE CONTRACT <br />A. General <br />If the Contractor should be adjudged a bankrupt, or if he should make a general assignment for the <br />benefit of his creditors, or if a receiver should be appointed to take over his affairs, or if he should fail <br />to prosecute his work with due diligence and carry the work forward in accordance with his work <br />schedule and the time limits set forth in the Contract Documents, or if he should fail to subsequently <br />perform one or more of the provisions of the Contract Documents to be performed by him, the Principal <br />Representative may serve Written Notice on the Contractor and the Surety on his performance and <br />payment bonds, stating his intention to exercise one of the remedies hereinafter set forth and the <br />grounds upon which the Principal Representative bases his right to exercise such remedy. In such <br />event, unless the matter complained of is satisfactorily cleared within ten (10) days after serving such <br />Notice, the Principal Representative may, without prejudice to any other right or remedy, exercise one <br />of such remedies, at once. <br />B. Conditions and Procedures <br />(a) The Principal Representative may terminate the services of the Contractor, which termination <br />shall take effect immediately upon serving notice to the Contractor and his Surety, whereupon <br />the Surety shall have the right to take over and perform the Contract. If the Surety does not <br />commence performance of the Contract within ten (10) days after service of the notice of <br />termination, the Principal Representative may take over the work, take possession of and use <br />all materials, tools, equipment and appliances on the premises and prosecute the work to <br />completion by such means as he shall deem best. In the event of such termination of his <br />service, the Contractor shall not be entitled to any further payment under his contract until the <br />work is completed and accepted. If the Principal Representative takes over the work and if the <br />unpaid balance of the contract price exceeds the cost of completing the work, including <br />compensation for any damages or expenses incurred by the Principal Representative through <br />the default of the Contractor, such excess shall be paid to the Contractor. If, however, the <br />cost, expenses and damages as certified by the Project Manager exceed such unpaid balance <br />of the contract price, the Contractor and his Surety shall pay the difference to the Principal <br />Representative. <br />(b) The Principal Representative may take control of the work and either make good the <br />deficiencies of the Contractor or direct the activities of the Contractor in doing so, employing <br />such additional help as the Principal Representative deems advisable. In such event the <br />Principal Representative shall be entitled to collect from the Contractor and his Surety, or to <br />deduct from any payment then or thereafter due the Contractor, the costs incurred in having <br />such deficiencies made good and any damages or expenses incurred through the default of the <br />Contractor, provided the Project Manager approves the amount thus charged to the Contractor. <br />(c) The Principal Representative may require the Surety on the Contractor's bond to take control <br />of the work at once and see to it that all the deficiencies of the Contractor are made good, <br />with due diligence. As between the Principal Representative and the Surety, the cost of <br />making good such deficiencies shall all be borne by the Surety. If the Surety takes over the <br />work, either upon termination of the services of the Contractor or upon instructions from the <br />principal. Representative to do so, the provisions of the Contract Documents shall govern in <br />respect of the work done by the Surety, the Surety being substituted for the Contractor as to <br />such provisions, including provisions as to payment for the work and provisions of this Article <br />DMG-14