4.

PERFOMANCE BOND

From the contract document;

ARTICLE 14: BONDS

A. The Contractor shall file with the Owner and City at or prior to the time of execution
of the Contract, a performance bond, a payment bond, and a warranty bond on Owner
and City-approved forms, each in the full amount of the Contract. The Surety
furnishing these bonds shall be satisfactory to the Owner and shall be authorized to do
business in the State of Arizona

From article 14, relate to the PWD 203: Clause 13

The contractor shall provide a Performance Bond/Performance

- Guarantee Sum (on the date of Site Possession).

- The amount is equivalent to 5 % of the total Contract Sum.
- Duration of liability: the date of Site Possession until 12 months after the expiry of the
Defect Liability Period or the issuance of the Certificate of Completion of Making
Good Defects, whichever is the later.

A bond taken out by the contractor, usually with a bank or insurance company (in return for
the payment of a premium), for the benefit of and at the request of the employer, in a
stipulated maximum sum of liability and enforceable by the employer in the event of the
contractor’s default, repudiation or insolvency. In essence, a performance bond is a mean of
guaranteeing to the employer the financial viability of the contractor’s ability to perform his
obligations under the engineering and construction contract.

5. EXTENSION OF TIME (EOT)

From the contract document;

ARTICLE 24: SUSPENSION OF WORK

A. The Owner may, at any time and without cause, order the Contractor in writing or
cause the Contractor to suspend, delay or interrupt all or any part of the Work for such
period of time as the Owner may determine to be appropriate for its convenience.
 Equitable adjustment shall be made for any increase in the Contract Time necessarily
caused by such suspension or delay by written Change Order.

From articles 24, relate to the PWD 203: Clause 43

Delay and extension of time

-To retain, as far as practicable, a defined time of completion for the contractor to work
towards in order to meet his obligations under the contract;

-To preserve the employer’s right to liquidated damages against acts of prevention;

-To give the contractor reasonable relief from his strict duty to complete on time in respect of
certain designated ‘neutral’ events such as strikes, riots, exceptionally inclement weather,
etc.;

-To enable employer to revise/fix a new date for completion for works under the contract.

- There are several reasons for the project delayed:

a) Act of prevention by employer

b) Delay in giving possession of
c) The site to the contractor
d) Interference by the employer’s
e) Contractors
f) Delay by the employer in issuing
g) Necessary instructions
h) Suspension of works by the
i) Employer without reasonable cause
j) Weathering