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<br /> §I The Contractor and Surer-,jointly and severally,bind themselves,their heirs,executors,administrators,successors
<br /> and assigns to the Owner for the performance of the Construction Contract,which is incorporated herein by reference.
<br /> §2 If the Contractor performs die Construction Contract,the Surety and the Contractor shall have no obligation under
<br /> this Bond,except whin applicable n)participate in a conference as provided in Section 3.
<br /> 53 If there is no Oatner Default under the Construction Contract,the Surety's obligation under this Bond shall arise
<br /> after
<br /> ,1 the Owner first provides notice to the Contractor and die Surety that the Owner is considering declaring
<br /> a Contractor Default.Such notice shall indicate whether the Owner is requesting a conference among
<br /> the Owner,Contractor and Surety to discuss the Contractor's performance.If the Owner does not
<br />• request a conference,the Surety may,within five(3) business days after receipt of the Owner's notice,
<br /> request such a conference.If the Surety timely requests a conference,the Owner shall attend. finless die
<br /> Owner agrees otherwise,any conference requested under this Section 3.1 shall be held within ten (11 I)
<br /> business days of the Surety's receipt of the Owner's notice. If the Owner,the Contractor and the Surety
<br /> agree,the Contractor shall he allowed a reasonable tole to perform the Construction Contract,but such
<br /> an agreement shall not waive the Owner's 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;
<br /> 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 ni 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 Surety's obligations,or release the Surety from its obligations,except to the
<br /> extent the Surety demonstrates actual prejudice.
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<br /> §5 When the Owner has satisfied the conditions of Section 3,the Surety shall promptly and at the Surety's expense rake
<br /> 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 1ndertake to perform and complete the Construction Contract itself,through its agents or independent
<br /> contractors;
<br /> 5 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 the
<br /> Owner and a contractor selected with the Owner's concurrence,to be secured with performance and payment bonds
<br /> executed by a qualified surety equivalent to the bonds issued on the Construction Contract,and pay to the Owner the
<br /> amount of damages as described in Section 7 in excess of the Balance of the Contract Price incurred by the Owner as a
<br /> result of die Contractor Default;or
<br /> §5.4 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 After investigation,determine the amount for which it mai be liable to the Owner and,as soon as
<br /> practicable after the amount is determined,make payment to die Owner;tic
<br /> .2 Deny liability in whole or in part.red notify the Owner,citing the reasons for denial.
<br /> §6 if the Surety does not proceed as provided In Section S with reasonable promptness,the Suss ty shall be deemed to
<br /> be in default on this Bond stem days after receipt of an additional written notice from the(h•net to the Surer-
<br /> densanding that the Surety perform its obligations under this Bond,and the Owner shall be enticed to enforce any
<br /> remedy available to the Owner.If the Surety-proceeds as provided in Section 5.4,and the Owner refuses the payment(Sr
<br /> the Surety has denied liability,in whole or in part,without further notice the t)wavy shall be entitled to enforce any
<br /> remedy available to the Owner.
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