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1. The Contractor and Surety, jointly and severally, bind
<br />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
<br />performance of the Construction Contract, which is
<br />incorporated herein by reference, subject to the following
<br />terms.
<br />2. If the Contractor promptly makes payment of all sums due
<br />to Claimants, and defends, indemnifies, and holds harmless
<br />the Owner from claims, demands, liens, or suits by any
<br />person or entity seeking payment for labor, materials, or
<br />equipment furnished for use in the performance of the
<br />Construction Contract, then the Surety and the Contractor
<br />shall have no obligation under this Bond.
<br />3. If there is no Owner Default under the Construction
<br />Contract, the Surety's obligation to the Owner under this
<br />Bond shall arise after the Owner has promptly notified the
<br />Contractor and the Surety (at the address described in
<br />Paragraph 13) of claims, demands, liens, or suits against the
<br />Owner or the Owner's property by any person or entity
<br />seeking payment for labor, materials, or equipment
<br />furnished for use in the performance of the Construction
<br />Contract, and tendered defense of such claims, demands,
<br />liens, or suits to the Contractor and the Surety.
<br />4. When the Owner has satisfied the conditions in Paragraph
<br />3, the Surety shall promptly and at the Surety's expense
<br />defend, indemnify, and hold harmless the Owner against a
<br />duly tendered claim, demand, lien, or suit.
<br />5. The Surety's obligations to a Claimant under this Bond shall
<br />arise after the following:
<br />5.1 Claimants who do not have a direct contract with the
<br />Contractor,
<br />5.1.1 have furnished a written notice of non-
<br />payment to the Contractor, stating with
<br />substantial accuracy the amount claimed and
<br />the name of the party to whom the materials
<br />were, or equipment was, furnished or supplied
<br />or for whom the labor was done or performed,
<br />within ninety (90) days after having last
<br />performed labor or last furnished materials or
<br />equipment included in the Claim; and
<br />5.1.2 have sent a Claim to the Surety (at the address
<br />described in Paragraph 13).
<br />5.2 Claimants who are employed by or have a direct
<br />contract with the Contractor have sent a Claim to the
<br />Surety (at the address described in Paragraph 13).
<br />6. If a notice of non-payment required by Paragraph 5.1.1 is
<br />given by the Owner to the Contractor, that is sufficient to
<br />satisfy a Claimant's obligation to furnish a written notice of
<br />non-payment under Paragraph 5.1.1.
<br />7. When a Claimant has satisfied the conditions of Paragraph
<br />5.1 or 5.2, whichever is applicable, the Surety shall promptly
<br />and at the Surety's expense take the following actions:
<br />7.1 Send an answer to the Claimant, with a copy to the
<br />Owner, within sixty (60) days after receipt of the Claim,
<br />stating the amounts that are undisputed and the basis
<br />for challenging any amounts that are disputed; and
<br />7.2 Pay or arrange for payment of any undisputed
<br />amounts.
<br />7.3 The Surety's failure to discharge its obligations under
<br />Paragraph 7.1 or 7.2 shall not be deemed to constitute
<br />a waiver of defenses the Surety or Contractor may
<br />have or acquire as to a Claim, except as to undisputed
<br />amounts for which the Surety and Claimant have
<br />reached agreement. If, however, the Surety fails to
<br />discharge its obligations under Paragraph 7.1 or 7.2,
<br />the Surety shall indemnify the Claimant for the
<br />reasonable attorney's fees the Claimant incurs
<br />thereafter to recover any sums found to be due and
<br />owing to the Claimant.
<br />8. The Surety's total obligation shall not exceed the amount of
<br />this Bond, plus the amount of reasonable attorney's fees
<br />provided under Paragraph 7.3, and the amount of this Bond
<br />shall be credited for any payments made in good faith by
<br />the Surety.
<br />9. Amounts owed by the Owner to the Contractor under the
<br />Construction Contract shall be used for the performance of
<br />the Construction Contract and to satisfy claims, if any,
<br />under any construction performance bond. By the
<br />Contractor furnishing and the Owner accepting this Bond,
<br />they agree that all funds earned by the Contractor in the
<br />performance of the Construction Contract are dedicated to
<br />satisfy obligations of the Contractor and Surety under this
<br />Bond, subject to the Owner's priority to use the funds for
<br />the completion of the work.
<br />10. The Surety shall not be liable to the Owner, Claimants, or
<br />others for obligations of the Contractor that are unrelated
<br />to the Construction Contract. The Owner shall not be liable
<br />for the payment of any costs or expenses of any Claimant
<br />under this Bond, and shall have under this Bond no
<br />obligation to make payments to or give notice on behalf of
<br />Claimants, or otherwise have any obligations to Claimants
<br />under this Bond.
<br />11. 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 />12. No suit or action shall be commenced by a Claimant under
<br />this Bond other than in a court of competent jurisdiction in
<br />the state in which the project that is the subject of the
<br />Construction Contract is located or after the expiration of
<br />one year from the date (1) on which the Claimant sent a
<br />Claim to the Surety pursuant to Paragraph 5.1.2 or 5.2, or
<br />EJCDC® C-615, Payment Bond
<br />Copyright © 2013 National Society of Professional Engineers, American Council of Engineering Companies,
<br />and American Society of Civil Engineers. All rights reserved. 2 of 3
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