Contractor's Bankruptcy or Default

Contractor's Bankruptcy or Default. In the event of a contractor's bankruptcy or default, any proposed agreements with the bonding company (other than the bonding company serving as general contractor or fully bonding another contractor acting as their agent) must be submitted for DWSELF loan allowability determination by the Department staff prior to execution. If the loan recipient determines that re-award of the construction/repair contract, or a portion thereof, is necessary due to contractor bankruptcy or default, such proposed re-award contracts must be submitted for DWSELF loan allowability determination by the Department staff prior to execution. The loan recipient will be responsible for assuring that every appropriate procedure and incidental legal requirement is observed in advertising for bids or otherwise re-awarding a construction contract, if this course of action is taken.