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1 The Contractor and the Surety, jointly and severally, bind
<br />themselves, their heirs, executors, administrators, successors
<br />and assigns to the Owner to pay for labor, materials and
<br />equipment furnished for use in the performance of the
<br />Construction Contract, which is incorporated herein by
<br />reference.
<br />2 With respect to the Owner, this obligation shall be null and
<br />void if the Contractor:
<br />2.1 Promptly makes payment, directly or indirectly, for all
<br />sums due Claimants, and
<br />2.2 Defends, indemnifies and holds harmless the Owner
<br />from claims, demands, liens or suits by any person or entity
<br />whose claim, demand, lien or suit is for the payment for
<br />labor, materials or equipment furnished for use in the
<br />performance of the Construction Contract, provided the
<br />Owner has promptly notified the Contractor and the Surety
<br />(at the address described in Paragraph 12) of any claims,
<br />demands, liens or suits and tendered defense of such
<br />claims, demands, liens or suits to the Contractor and the
<br />Surety, and provided there is no Owner Default.
<br />3 With respect to Claimants; this obligation shall be null and
<br />void if the Contractor promptly makes payment, directly or
<br />indirectly, for all sums due.
<br />4. The Surety shall have no obligation to Claimants under this
<br />Bond until:
<br />4.1 Claimants who are employed by or have a direct
<br />contract with the Contractor have given notice to the
<br />Surety (at the address described in Paragraph 12) and
<br />sent a copy, or notice thereof, to the Owner, stating that a
<br />claim is being made under this Bond and, with substantial
<br />accuracy, the amount of the claim.
<br />4.2 Claimants who do not have a direct contract with the
<br />Contractor:
<br />Have furnished written notice to the Contractor
<br />and sent a copy, or notice thereof, to the Owner,
<br />within 90 days after having last performed labor
<br />or last furnished materials or equipment included
<br />in the claim stating, with substantial accuracy, the
<br />amount of the claim and the name of the party to
<br />whom the materials were furnished or supplied or
<br />for whom the labor was done or performed; and
<br />.2 Have either received a rejection in whole or in part
<br />from the Contractor, or not received within 30
<br />days of furnishing the above notice any
<br />communication from the Contractor by which the
<br />Contractor has indicated the claim will be paid
<br />directly or indirectly; and
<br />.3 Not having been paid within the above 30 days,
<br />have sent a written notice to the Surety (at the
<br />address described in Paragraph 12) and sent a
<br />copy, or notice thereof, to the Owner, stating that
<br />a claim is being made under this Bond and
<br />enclosing a copy of the previous written notice
<br />furnished to the Contractor.
<br />5 If a notice required by Paragraph 4 is given by the Owner to
<br />the Contractor or to the Surety, that is sufficient compliance.
<br />Paragraph 6 is deleted in its entirety and the following is
<br />substituted in its place:
<br />6. When the Claimant has satisfied the conditions of
<br />Paragraph 4, and has submitted all supporting documentation
<br />and any proof of claim requested by the Surety, the Surety
<br />shall, within a reasonable period of time, notify the Claimant of
<br />the amounts that are undisputed and the basis for challenging
<br />any amounts that are disputed, including, but not limited to, the
<br />lack of substantiating documentation to support the claim as to
<br />entitlement or amount, and the Surety shall, within a
<br />reasonable period of time, pay or make arrangements for
<br />payment of any undisputed amount; provided, however, that
<br />the failure of the Surety to timely discharge its obligations
<br />under this paragraph or to dispute or identify any specific
<br />defense to all or any part of a claim shall not be deemed to be
<br />an admission of liability by the Surety as to such claim or
<br />otherwise constitute a waiver of the Contractor's or Surety's
<br />defenses to, or right to dispute, such claim. Rather, the
<br />Claimant shall have the immediate right, without further notice,
<br />to bring suit against the Surety to enforce any remedy available
<br />to it under this Bond.
<br />7 The Surety's total obligation shall not exceed the amount of
<br />this Bond, and the amount of this Bond shall be credited for
<br />any payments made in good faith by the Surety.
<br />8 Amounts owed by the Owner to the Contractor under the
<br />Construction Contract shall be used for the performance of the
<br />Construction Contract and to satisfy claims, if any, under any
<br />Construction Performance Bond. By the Contractor furnishing
<br />and the Owner accepting this Bond, they agree that all funds
<br />earned by the Contractor in the performance of the Construction
<br />Contract are dedicated to satisfy obligations of the Contractor
<br />and the Surety under this Bond, subject to the Owner's priority
<br />to use the funds for the completion of the work.
<br />9 The Surety shall not be liable to the Owner, Claimants or
<br />others for obligations of the Contractor that are unrelated to the
<br />Construction Contract. The Owner shall not be liable for
<br />payment of any costs or expenses of any Claimant under this
<br />Bond, and shall have under this Bond no obligations to make
<br />payments to, give notices on behalf of, or otherwise have
<br />obligations to Claimants under this Bond.
<br />10 The Surety hereby waives notice of any change, including
<br />changes of time, to the Construction Contract or to related
<br />subcontracts, purchase orders and other obligations.
<br />11 No suit or action shall be commenced by a Claimant under
<br />this Bond other than in a court of competent jurisdiction in the
<br />location in which the work or part of the work is located or after
<br />the expiration of one year from the date (1) on which the
<br />Claimant gave the notice required by Subparagraph 4.1 or
<br />Clause 4.2.3, or (2) on which the last labor or service was
<br />performed by anyone or the last materials or equipment were
<br />furnished by anyone under the Construction Contract, whichever
<br />of (1) or (2) first occurs. If the provisions of this Paragraph are
<br />void or prohibited by law, the minimum period of limitation
<br />available to sureties as a defense in the jurisdiction of the suit
<br />shall be applicable.
<br />12 Notice to the Surety, the Owner or the Contractor shall be
<br />mailed or delivered to the address shown on the signature page.
<br />Actual receipt of notice by Surety, the Owner or the Contractor,
<br />however accomplished, shall be sufficient compliance as of the
<br />date received at the address shown on the signature page.
<br />13 When this Bond has been furnished to comply with a
<br />statutory or other legal requirement in the location where the
<br />construction was to be performed, any provision in this Bond
<br />conflicting with said statutory or legal requirements shall be
<br />deemed deleted here from and provisions conforming to such
<br />statutory or other legal requirement shall be deemed
<br />incorporated herein. The intent is that this
<br />AIA DOCUMENT A312 • PERFORMANCE BOND AND PAYMENT BOND • DECEMBER 1984 ED. • AIA
<br />THE AMERICAN INSTITUTE OF ARCHITECTS, 1735 NEW YORK AVE., N.W., WASHINGTON, D.C. 20006 A312 -1984 5
<br />TWIPn 0Q1KJTINr'- . hAADIN4 10R7
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