Bond to Secure the Performance of a Contract
A performance bond, also known as a contract bond, is a written guaranty issued by a third party (usually insurance company or a bank) to ensure a satisfactory completion of a project by a contractor. A job requiring a payment and performance bond will usually require a bid bond, to bid the job. It binds the contractor for rendering appropriate services.
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DRAFT OF BOND TO SECURE THE PERFORMANCE OF A CONTRACT
By this Bond I Mr. A residing at ………………..... the Obligor acknowledge to be bound to pay to Mr. B the Obligee the sum of Rs... on demand by the said Obligee.
WHEREAS by a Contract entered into between the Obligee and the Obligor, the Obligee has appointed the Obligor as a contractor to construct a building on the plot of land of Obligee situated at ... in terms of the said contract.
AND WHEREAS as the said contract provides that the Obligor will execute a bond in the sum of Rs... for the proper performance of the said contract.
NOW The Condition of this Bond is that If the Obligor contractor or his legal representatives or permitted assigns shall and will and truly, perform and fulfill and keep all and every covenant, clause, provision, term or condition in the said contract and on the part of the Obligor (Contractor) to be observed and performed according to the true purport and intent or meaning thereof, then this Bond shall be treated as void but otherwise it shall remain in full force and effect.
In Witness Whereof the Obligor has put his hand this ... day of ………….., 20__.
Signed and delivered by the
with in named Mr.………….
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