Performance Bond Requirements

Performance Bond Requirements. Prior to the commencement of work, the Contractor shall furnish to the Owner a Performance Bond in the amount of one hundred percent (100%) of the Contract Price, and a Payment Bond in the amount of one hundred percent (100%) of the Contract Price, both issued by a surety company authorized to do business in the state where the project is located and acceptable to the Owner. The bonds shall be in the form prescribed by the Contract Documents and shall comply with all applicable statutory requirements, including the Miller Act (40 U.S.C. §§ 3131-3134) for federal projects, or applicable state Little Miller Act provisions for state and local public projects. The Performance Bond shall guarantee the faithful performance of the Contract and the prompt and proper completion of all work in accordance with the Contract Documents. The Payment Bond shall guarantee payment of all obligations arising under the Contract, including payment to all subcontractors, laborers, and material suppliers. The surety company shall have a current A.M. Best rating of A- or better and a financial size category of VII or higher. If the surety company becomes unacceptable to the Owner at any time during the performance of the Contract, the Contractor shall promptly provide replacement bonds from an acceptable surety at no additional cost to the Owner.