Performance and Payment Security Clause Samples
The Performance and Payment Security clause requires parties, typically contractors, to provide assurances that they will fulfill their contractual obligations and pay their subcontractors or suppliers. This is often achieved through instruments such as performance bonds, payment bonds, or letters of credit, which serve as financial guarantees. By implementing these security measures, the clause protects the project owner from losses due to non-performance or non-payment, ensuring that the project is completed as agreed and that all parties in the supply chain are compensated.
Performance and Payment Security. 10.2.1 As a condition precedent to Department’s issuance of LNTP1, Design-Builder shall procure and maintain:
1 a performance bond that provides for expedited or accelerated dispute resolution in the form set forth in Exhibit 13, executed by a surety acceptable to Department, in an amount equal to two hundred fifty million dollars ($250,000,000); and
.2 a payment bond in the form set forth in Exhibit 14, executed by a surety acceptable to Department, in an amount equal to two hundred fifty million dollars ($250,000,000).
10.2.2 As a condition precedent to Department’s issuance of the NTP, Design-Builder shall procure and maintain:
1 a performance bond that provides for expedited or accelerated dispute resolution in the form set forth in Exhibit 13, executed by a surety acceptable to Department, in an amount equal to one billion two hundred fifty million dollars ($1,250,000,000) (the “Performance Bond”); and
.2 a payment bond in the form set forth in Exhibit 14, executed by a surety acceptable to Department, in an amount equal to one billion two hundred fifty million dollars ($1,250,000,000) (the “Payment Bond”).
10.2.3 Design-Builder may satisfy the terms of Section 10.2.2 by (i) increasing the penal sum of each of the performance bond and the payment bond provided by Design-Builder pursuant to Section 10.2.1 to the amount specified in Section 10.2.2 or (ii) replacing each of the performance and payment bond provided by Design-Builder pursuant to Section 10.2.1 with a performance bond and a payment bond that meet the requirements set forth in Section 10.2.2.
10.2.4 Design-Builder shall maintain the Payment Bond until the date on which Department makes final payment to Design-Builder in accordance with Section 6.8.3 of the General Conditions of Contract. Design-Builder shall maintain the Performance Bond until the later of:
(i) the second (2nd) anniversary of the Final Completion Date and (ii) the expiration of the warranty period set forth in Section 2.10 of the General Conditions of Contract; provided that, as of the Final Completion Date, the surety’s penal sum under the Performance Bond shall be reduced to one hundred million dollars ($100,000,000).
Performance and Payment Security. The following provisions set forth financial guarantees that must be met by Contractor. Contractor may choose to meet the requirements of this Section 4.8 by obtaining either the required bonds or an irrevocable letter of credit (Letter of Credit) in an equivalent amount.
Performance and Payment Security. DB Team shall furnish, either P&P Bonds meeting the requirements of this Article 16.2 as performance and payment security for the Work.
Performance and Payment Security. The Contractor will comply with all performance and payment security requirements as set out in Schedule 11 [Prices and Payment].
Performance and Payment Security. On or before the Financial Closing Date, the Section Developer shall furnish, or cause the D&C Contractor to furnish, the following: a) a performance bond in the form to be set out in the Section P3 Agreement in an amount equal to 100% of the total value of D&C Work (the "Performance Bond"); and b) a payment bond in the form to be set out in the Section P3 Agreement in an amount equal to 100% of the total value of D&C Work (the "Payment Bond").7 Each of the Performance Bond and the Payment Bond must be issued by a surety or an insurance company authorized to issue bonds in the State that is rated in the top two categories by two of the three nationally recognized rating agencies or at least "A-" or better and "Class X" or better according to A.M. Best’s Financing Strength Rating and Financial Size Category. In addition any surety or insurance company issuing such bonds must be listed on the current U.S. Treasury Listing of Certified Companies and the limit of the bond written by such surety or insurance company on any one project must not exceed the approved Underwriting Limitation on the U.S. Treasury list. Each of the Performance Bond and the Payment Bond will name MDOT, MDTA, and the collateral agent as additional obligees, and further provide that each of the Performance Bond and the Payment Bond may be transferred by the Section Developer to MDOT, MDTA, or the collateral agent, as beneficiary, with rights to draw upon or exercise other remedies if MDOT, MDTA, or the collateral agent succeeds to the position of the Section Developer under the Section P3 Agreement. In all contracts with respect to the D&C Work entered into by the Section Developer, the Section Developer shall require its Contractors and suppliers to waive any right to seek a mechanic’s lien against the Section or the Site in consideration for the Section Developer’s provision of the Payment Bond. The Section Developer shall maintain, or cause the D&C Contractor to maintain, each of the Performance Bond and the Payment Bond until the expiry of the GP Defect Remedy Period (subject to step-downs as may be set forth in the Section P3 Agreement). If the Section Developer is required under the terms of the Finance Documents to provide or ensure that a Key
Performance and Payment Security. 10.2.1 As a condition precedent to Department’s issuance of the LNTP, Design-Builder shall
10.2.2 As a condition precedent to Department’s issuance of the NTP, Design-Builder shall procure and maintain:
.1 a performance bond in the form set forth in Exhibit 13 executed by a surety acceptable to Department in an amount equal to one billion seven hundred fifty million dollars ($1,750,000,000) (the “Performance Bond”);
.2 a payment bond in the form set forth in Exhibit 14 executed by a surety acceptable to Department in an amount equal to one billion seven hundred fifty million dollars ($1,750,000,000) (the “Payment Bond”); and .3 one or more letters of credit in the form set forth in Exhibit 15 (the “Liquid Performance Security”), each meeting the requirements of Section 10.4, in an aggregate amount equal to one hundred million dollars ($100,000,000).
10.2.3 Design-Builder shall maintain each of the Performance Bond, the Payment Bond, and the Liquid Performance Security until the second (2nd) anniversary of the Final Completion Date; provided, however, that as of the Final Completion Date, (i) the Liquid Performance Security shall be reduced to fifteen million dollars ($15,000,000) and (ii) surety’s penal sum under the Performance Bond shall be reduced to one hundred million dollars ($100,000,000).
Performance and Payment Security. The Contractor shall furnish bonds issued by a surety approved by the County covering faithful performance of this Contract and payment of obligations arising thereunder. The cost of the bonds shall be equal to 100 percent of the Contract's total not-to-exceed amount. The Contractor shall deliver the required bonds to the County not later than the date of execution of the Contract, or if the Work is to be commenced prior thereto in response to a letter of intent, the Contractor shall, prior to commencement of the Work, submit evidence satisfactory to the County that such bonds will be furnished. The Contractor shall require the attorney-in-fact who executes the required bonds on behalf of the surety to affix thereto a certified and current copy of the power of attorney. Upon request of any person or entity appearing to be a potential beneficiary of bonds covering payment of obligations arising under the Contract, the Contractor shall promptly furnish a copy of the bonds or shall permit a copy to be made.
Performance and Payment Security. Major Vendor has delivered the Parent Guaranty to Owner as of the Effective Date. No later than the date of the Notice to Proceed, Major Vendor shall deliver to Owner as security for the performance by Major Vendor of the Major Vendor Services and its other obligations under this Agreement and payment of any amounts owed to Owner relating to the Project, the claims based policy of errors and omissions insurance and the Letter of Credit described in Exhibit N. The Parent Guaranty and the claims based errors and omissions policies of insurance described in Exhibit N shall remain in force and effect until the end of the Warranty Period and all of Major Vendor’s obligations hereunder have been satisfied and fulfilled. As long as there are no claims by Owner against Major Vendor relating to the Project as of the Handover Date, the Letter(s) of Credit described in Exhibit N shall be returned by Owner to Major Vendor after the Handover Date within five (5) Business Days after Owner’s receipt of Major Vendor’s written notice to Owner requesting return thereof.
Performance and Payment Security. If the Municipality constructs the Trail Connection through the services of a contractor, then the Municipality shall require said contractor to execute a Performance and Payment Bond in the full amount of the contract. The Performance Bond and Payment Bond shall indicate both the Municipality and the Forest Preserve as Owners of the Bond.
Performance and Payment Security. When the Contract Price is $100,000 or more (or $50,000 or more in the case of Contracts for highways, bridges and other transportation projects) the Contractor shall furnish and maintain in effect at all times during the Contract Period, a performance bond in a sum equal to the Contract Price, and a separate payment bond also in a sum equal to the Contract Price. The bonds may be required if the Contract Price is less than the above thresholds, if required by the Contract Documents. Bonds must be from a surety company authorized to conduct business in Oregon. pg. 4