Agmt11 Kentfield Pacific Place, LLC

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(3) For Securitv to Insure Guarantee. Owner agrees, as a condition precedent to City's acceptance of any of the Improvements which are the subject of this Agreement, to furnish and file with the City Clerk a bond or deposit in the amount of Forty Three Thousand Eight Hundred Sixteen and No/100 Dollars ($43,816.00) for all expressly conditioned Improvements to secure Owner's compliance with the provisions of Paragraph 9 hereof, for a period of one (1) year after final acceptance of the work done under this Agreement. The form of this security shall be subject to the City's prior approval. B. If the improvement security is a corporate surety bond and, in the opinion of the City, any surety or sureties, thereon become insufficient, the Owner shall renew or replace any such surety with good and sufficient surety or sureties within ten (10) days after receiving from City written demand thereof. C. Improvement security consisting of corporate surety bonds shall be kept on file with the City Engineer. If a corporate surety bond is replaced by another approved bond, the replacement shall be filed with the City Engineer and made a part of an incorporated into this Agreement. Upon filing and approval by the City Engineer of a replacement bond, the former improvement security shall be released. D. Modifications of the Improvements Plans and related specifications, and modifications of the Improvements, not exceeding ten percent (10%) of the original Estimated Total Cost of the Improvements, shall not relieve or release any improvement security furnished by Owner pursuant to this Agreement. If any such modifications exceed ten percent (10%) of the Estimated Total Cost of the Improvements, Owner shall furnish additional improvement security for, performance and guarantee, and for payment, as required by subparagraph A above, for one hundred percent (100%) of the revised Estimated Total Cost of the Improvements. 3. REDUCTION OR RELEASE OF IMPROVEMENT SECURITY A. Partial releases or reductions in the Owner's improvement security may be authorized prior to the City's acceptance of all Improvements required hereunder, as provided in this Section 3. B. Upon acceptance of all or any specified category of the Improvements by the City Council and upon request of the Owner, the improvement security may be reduced or released as follows: (1) Securitv for Pertormance The Security for Performance provided by Section 2.A.(1) above may be released as the Improvements progress; provided, however, that no such release shall be for an amount less than ten percent (10%) of the total improvement security given for faithful perFormance of the act or work and that the security shall not be reduced to an amount less than seventy-five percent (75%) of the total improvement security given for faithful pertormance until final completion and acceptance of the Improvements. In no event shall the City authorize a release of the improvement security which ATTY/AGR/2011.134/KENTFIELD SUBDIVISION REV:12/01/11 Page 3 of 8