Page 264 - Urban Construction Project Management

Insurance and Bonds 219
Exhibit 10-5
KNOW ALL MEN BY THESE PRESENTS: That (name of subcontractor) as Principal,
hereinafter called Principal, (name of Bonding Company) and hereinafter called Sample payment
Surety, are held and firmly bound unto (name of Owner/CM/GC) as Obligee, bond.
hereinafter called Obligee, in the amount of Dollars ($ dollar amount of the contract
or bond), for the payment whereof Principal and Surety bind themselves, their heirs,
executors, administrators, successors and assigns, jointly and severally, firmly these
presents. WHEREAS, Principal has by written agreement dated (date of signed
contract between subcontractor and Owner/CM/GC) entered into a subcontract
with Obligee for (description of the project and scope of work) in accordance with
drawings and specifications prepared by (name of Architect, Engineers, and
Specialty Consultants) which subcontract is by reference made a part hereof, and
is hereafter referred to as the subcontract. NOW, THEREFORE, THE CONDITION
OF THIS OBLIGATION is such that if the Principal shall promptly make payments to
all claimants as hereinafter defined, for all labor and material used or reasonably
required for use in the performance of the subcontract, then this obligation shall be
void; otherwise it shall remain in full force and effect subject, however, to the follow-
ing conditions:
(1) A claimant is defined as one having a direct contract with the Principal for labor,
material, or both, used or reasonably required for use in the performance of the
contract, labor and material being construed to include that part of water, gas,
power, light, heat, oil, gasoline, telephone service or rental of equipment directly
applicable to the subcontract.
(2) The above-named Principal and Surety hereby jointly and severally agree
with the Obligee that every claimant has herein defined, who has not been
paid in full before the expiration of a period of ninety (90) days after the date
on which the last of such claimant’s work or labor was done or performed, or
materials were furnished by such claimant, may sue on this bond for the use
of such claimant, prosecute the suit to final judgment for such sum or sums
as may be justly due claimant, and have execution thereon. The Obligee
shall not be liable for the payment of any costs or expenses of any such
suit.
(3) No suit or action shall be commenced hereunder by any claimant.
(a) After the expiration of one (1) year following the date on which Principal
ceased work on said subcontract it being understood, however, that if
any limitation embodied in this bond is prohibited by any law controlling
the construction hereof such limitation shall be deemed to be amended
so as to be equal to the minimum period of limitation permitted by such
law.
(b) Other than in a state court of competent jurisdiction in and for the county or
other political subdivision of the state in which the project, or any part
thereof, is situated, or in the United States District Court for the district in
which the project, or any part thereof, is situated, and not elsewhere.
(4) The amount of this bond shall be reduced by and to the extent of any payment
or payments made in good faith hereunder.

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