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'1 The Contractor and the Surety, jointly and severally,
<br />bind themselves, their heirs, executors, administrators,
<br />successors and assigns to the Owner to pay for labor,
<br />materials and equipment furnished for use in the perfor-
<br />mance of the Construction Contract, which is incorpo-
<br />rated herein by reference.
<br />2 With respect to the Owner, this obligation shall be
<br />null a-nd void if the Contractor:
<br />2.1 Promptly makes payment, directly or indirectly,
<br />for all sums due Claimants, and
<br />2.2 Defends, indemnifies and holds harmless the
<br />Owner from claims, demands, liens or suits by any
<br />person or entity whose claim, demand, lien or suit is
<br />for the payment for labor, materials or equipment fur-
<br />nished for use in the performance of the Construction
<br />Contract, provided the Owner has promptly notified
<br />the Contractor and the Surety (at the address
<br />described in Paragraph 12) of any claims, demands,
<br />liens or suits and tendered defense of such claims,
<br />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
<br />null and void if the Contractor promptly makes pay-
<br />ment, directly or indirectly, for all sums due.
<br />4 The Surety shall have no obligation to Claimants
<br />under this 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
<br />that a claim is being made under this Bond and, with
<br />substantial accuracy, the amount of the claim.
<br />4.2 Claimants who do not have a direct contract
<br />with the Contractor:
<br />.1 Have furnished written notice to the Con-
<br />tractor and sent a copy, or notice thereof, to
<br />the Owner, within 90 days after having last
<br />performed labor or last furnished materials or
<br />equipment included in the claim stating, with
<br />substantial accuracy, the amount of the claim
<br />and the name of the party to whom the
<br />materials were furnished or supplied or for
<br />whom the labor was done or performed; and
<br />.2 Have either received a rejection in whole or
<br />in part from the Contractor, or not received
<br />within 30 days of furnishing the above no-
<br />tice any communication from the Contractor
<br />by which the Contractor has indicated the
<br />claim will be paid directly or indirectly; and
<br />.3 Not having been paid within the above 30
<br />days, have sent a written notice to the Surety
<br />(at the address described in Paragraph 12) and
<br />sent a copy, or notice thereof, to the Owner,
<br />stating that a claim is being made under this
<br />Bond and enclosing a copy of the previous
<br />written notice furnished to the Contractor.
<br />5 If a notice required by Paragraph 4 is given by the
<br />Owner to the Contractor or to the Surety, that is suffi-
<br />cient compliance.
<br />6 When the Claimant has satisfied the conditions of
<br />Paragraph 4, the Surety shall promptly and at the
<br />Surety's expense take the following actions:
<br />6.1 Send an answer to the Claimant, with a copy to
<br />the Owner, within 45 days after receipt of the claim,
<br />stating the amounts that are undisputed and the basis
<br />for challenging any amounts that are disputed.
<br />6.2 Pay or arrange for payment of any undisputed
<br />amounts.
<br />7 The Surety's total obligation shall not exceed the
<br />amount of this Bond, and the amount of this Bond shall be
<br />credited for any payments made in good faith by the Surety.
<br />8 Amounts owed by the Owner to the Contractor under
<br />the Construction Contract shall be used for the perfor-
<br />mance of the Construction Contract and to satisfy claims,
<br />if any, under any Construction Performance Bond. By
<br />the Contractor furnishing and the Owner accepting this
<br />Bond, they agree that all funds earned by the Contractor
<br />in the performance of the Construction Contract are
<br />dedicated to satisfy obligations of the Contractor and
<br />the Surety under this Bond, subject to the Owner's prior-
<br />ity to use the funds for the completion of the work.
<br />9 The Surety shall not be liable to the Owner, Claimants
<br />or others for obligations of the Contractor that are unrelat-
<br />ed to the Construction Contract. The Owner shall not be
<br />liable for payment of any costs or expenses of any Claim-
<br />ant under this Bond, and shall have under this Bond no obli-
<br />gations to make payments to, give notices on behalf of, or
<br />otherwise have obligations to Claimants under this Bond.
<br />10 The Surety hereby waives notice of any change,
<br />including changes of time, to the Construction Contract
<br />or to related subcontracts, purchase orders and other
<br />obligations.
<br />11 No suit or action shall be commenced by a Claimant
<br />under this Bond other than in a court of competent juris-
<br />diction in the location in which the work or part of the
<br />work is located or after the expiration of one year from the
<br />date (1) on which the Claimant gave the notice required by
<br />Subparagraph 4.1 or Clause 4.2.3, or (2) on which the last
<br />labor or service was performed by anyone or the last mate-
<br />rials or equipment were furnished by anyone under the Con-
<br />struction Contract, whichever of (1) or (2) first occurs. If the
<br />provisions of this Paragraph are void or prohibited by law,
<br />the minimum period of limitation available to sureties as a
<br />defense in the jurisdiction of the suit shall be applicable.
<br />12 Notice to the Surety, the Owner or the Contractor
<br />shall be mailed or delivered to the address shown on the
<br />signature page. Actual receipt of notice by Surety, the
<br />Owner or the Contractor, however accomplished, shall
<br />be sufficient compliance as of the date received at the
<br />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
<br />the construction was to be performed, any provision in this
<br />Bond conflicting with said statutory or legal requirement
<br />shall be deemed deleted herefrom and provisions con-
<br />forming to such statutory or other legal requirement shall
<br />be deemed 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 />THIRD PRINTING • MARCH 1987
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