Common use of Alternative Security Clause in Contracts

Alternative Security. In lieu of providing the Payment and Performance Bonds, Concessionaire may provide any of the following alternative security: (i) a completion guaranty, in form and substance reasonably acceptable to Director, made by an individual or entity with a sufficient net worth and liquidity, in the sole discretion of Director, to comply with the terms of such guaranty in view of the potential financial responsibility involved, (ii) a certificate of deposit, cash or United States governmental security, (iii) an Irrevocable Stand By Letter of Credit, or (iv) a set aside letter from Concessionaire’s construction lender. The security described in clause (ii), (iii) and (iv) above shall be in an amount equal to one hundred percent (100%) of the construction contract price for hard costs, and shall permit County to draw thereon to complete the construction of the Improvements if same have not been completed by Concessionaire or if a material Event of Default has occurred under this Contract. In addition, Director also shall have the authority to accept in lieu of the Payment and Performance Bonds, so-called “Subguard” insurance in such amount, on such terms and issued by such carrier as approved by Director, in combination with such other security, such as a completion guaranty, as acceptable to Director. Any alternative security provided by Concessionaire pursuant to this subsection may name County and Concessionaire’s construction lender as co-beneficiaries. A condition precedent to Concessionaire’s right to provide the alternate security described in this Subsection 5.4.4. shall be delivery by Concessionaire to County of an opinion of legal counsel licensed to practice in the State of California and in a form acceptable to County to the effect that the construction work does not constitute a public work of improvement requiring the delivery of the bonds described in Subsection 5.4.3. above. Director shall have the authority, in his reasonable discretion, to ▇▇▇▇▇▇, waive or reduce the amount of any bonds or alternate security required hereunder.

Alternative Security. In lieu of providing the Payment and Performance Bonds, Concessionaire Lessee may provide any of the following alternative security: (i) a completion guaranty, in form and substance reasonably acceptable to Director, made by an individual or entity with a sufficient net worth and liquidity, liquidity that in the sole discretion good faith judgment of Director, Director is sufficient to comply with the terms of such guaranty in view of the potential financial responsibility involved, (ii) a certificate of deposit, cash or United States governmental security, (iii) an Irrevocable Stand By Letter a letter of Creditcredit, or (iv) a set aside letter from Concessionaire’s construction lenderother form of security approved by Director. The security described in clause clauses (ii), (iii) and through (iv) above shall be in an amount equal to one hundred percent (100%) of the construction contract price for hard costsprice, and shall permit County to draw thereon to complete the construction of the Improvements if the same have not been completed by Concessionaire Lessee as required pursuant to the terms of this Lease, or if a material an Event of Default has occurred under this ContractLease. In addition, Director also shall have the authority to accept in lieu of the Payment and Performance Bonds, so-called “Subguard” insurance in such amount, on such terms and issued by such carrier as approved by Director in Director’s good faith discretion, in combination with such other security, such as a completion guaranty, as acceptable to Director in Director’s good faith discretion. Any alternative security provided by Concessionaire Lessee pursuant to this subsection may name County and ConcessionaireLessee’s construction lender as co-beneficiaries. A condition precedent to ConcessionaireLessee’s right to provide the alternate security described in this Subsection 5.4.4. 5.4.4 shall be delivery by Concessionaire Lessee to County of an opinion of legal counsel licensed to practice in the State of California from a law firm and in a form acceptable to County to the effect that the construction work does not constitute a public work of improvement requiring the delivery of the bonds described in Subsection 5.4.3. 5.4.3 above. Director shall have the authority, in his reasonable discretion, to ▇▇▇▇▇▇modify, waive or reduce the amount of any bonds or alternate security required hereunder.