436.312. Substitute security requirements. - Missouri Statutes

Substitute security requirements.

436.312. 1. The following shall constitute acceptable substitutesecurity for purposes of sections 436.306 and 436.309:

(1) Certificates of deposit drawn and issued by a national bankingassociation located in this state or by any banking corporationincorporated pursuant to the laws of this state, and mutually agreeable tothe project owner and the contractor or subcontractor, in the amount of theretainage released. If the letter of credit is not renewed at least sixtydays before the expiration of the letter of credit, the owner may draw uponthe letter of credit regardless of the contractor's or subcontractor'sperformance for an amount equal to or no greater than the value of theamount of work remaining to be performed by the contractor orsubcontractor;

(2) A retainage bond naming the owner as obligee issued by any suretycompany authorized to issue surety bonds in this state in the amount of theretainage released; or

(3) An irrevocable and unconditional letter of credit in favor of theowner, issued by a national banking association located in this state or byany banking corporation incorporated pursuant to the laws of this state, inthe amount of the retainage released.

2. The contractor shall be entitled to receive, in all events, allinterest and income earned on any securities deposited by the contractor insubstitution for retainage.

(L. 2002 H.B. 1403)