Section J Atch 6 - Bank Letter Guarantee

RFP FA5685-10-R-0002

ATTACHMENT 6 - BANK LETTER GUARANTEE SAMPLE

BANK LETTER OF GUARANTEE 21 APR 07

a. Within ten (10) calendar days after the date of contract/order, the contractor shall furnish the Contracting Officer a Bank Letter of Guarantee for the performance of the work in the amount specified below and conforming to the format of the sample letter provided (Attachment 3). Failure to furnish the Letter of Guarantee may be deemed a breach of contract.

AMOUNT OF TASK ORDER BANK LETTER OF GUARANTEE

Up to $10,000.00 None

$10,000.01 - $25,000.00 25%, not to exceed $5,000.00

$25,000.01 - $100,000.00 20%, not to exceed $15,000.00

$100,000.01 - $500,000.00 15%, not to exceed $50,000.00 over $500,000.00 15%, not to exceed $100,000.00

b. The Bank Letter of Guarantee will be dated as of the contract/order date or as soon thereafter as possible. The Bank Letter of Guarantee shall state that a guarantee has been issued against the awarded contract/order and that the following conditions are in force:

1. When presented by a representative of the U.S. Government against debts due, redemption cannot be contested.

2. Value of the guarantee is to be cited in U.S. Dollars, or if Turkish Lira it shall include the statement “Value in Turkish Lira will correspond to the current exchange rate to U.S. Dollars in effect at the time of redemption”. And it will be equal at all times to the percentage as stated in the criteria above.

3. The Bank Letter of Guarantee shall also state that the bank agrees and consents that the contract/order may be modified by change order or supplemental agreement without effecting the validity of the Bank Letter of Guarantee. The Notice to Proceed (Construction) will not be issued until the approval and acceptance by the Contracting Officer.

c. The Bank Letter of Guarantee will continue in effect throughout the performance period, satisfactory completion of requirements and until expiration of any applicable guarantee period or extension thereof. During the period of warranty an amount equal to five (5) percent of the original contract/order price shall be applicable.

(End of Instruction)

Sample:

DEPARTMENT OF THE AIR FORCE

39TH AIR BASE WING (USAFE)

LETTER OF GUARANTEE

INCIRLIK AB TURKEY

CONTRACTING OFFICER

39 CONS/LGCA

INCIRLIK HAVA USSA

ADANA, TURKEY

LETTER OF GUARANTEE NO:

We are advised that you have concluded a contract with firm Company name, hereinafter called the "contractor," contract reference number Contract number, on Date.

The contract is to Contract Requirements. The total contract price is $Total Contract Value Pursuant to the contract, the contractor must provide security in the amount of 15 % of the total contract price not to exceed $50,000.00, ($Total Contract Value X Rate Determined Based on Task Order Amount) for timely and satisfactory performance of the contract. Pursuant to the contract, the contractor is authorized to provide such security in the form of a bank guarantee.

Having premised this, we, the Bank Bank Name of City, Country do, hereby covenant to pay to you the sum of $ Dollar Value of Guarantee immediately upon receipt of a written demand by your contracting officer, in which you confirm that the contractor has failed to meet his obligations under the above reference contract. The sum of the guarantee will be paid by check made payable to the Treasurer of the United States within 15 days from receipt of the written demand by the contracting officer. If payment is made after this date, it shall) include 8 1/8% percent interest starting the 16th day after receipt of this written demand. This letter of guarantee will continue in effect until the contract work has been finally accepted by the US Government and will continue thereafter in an amount equal to (5%) of the original contract price, until all applicable guarantees, or extension thereof under the contract have expired. At that time, this document will be given back to us.

We understand that the contract may be modified by change order or supplemental agreement affecting the contract price and/or performance time and we consent to such modifications. If the contract price is thereby increased by at least $15,000, we agree to provide an additional letter of guarantee in the amount 15 percent of the increased contract amount.

This is a Guarantee. Our obligation as the guarantor is independent of the existence and extent of the Contractor's obligation. The rights and obligations arising out of this guarantee are subject of the laws of Turkey.

(Name and address of Guarantor) Signed by:_________________________ Seal or stamp of Guarantor (Name typed underneath signature) Typed Title:________________________ By:______________________________

(Name typed underneath signature) Typed Title:_________________________