Payment Bond.doc

SAMPLE

OFFICIAL BANK LETTERHEAD

BANK LETTER OF PAYMENT GUARANTY

(Place)

(Date)

Contracting Officer

American Consulate General

Regional Support center

Regional Procurement Support Office

Giessenerstrasse 30 60435 Frankfurt am Main

Germany

SUBJECT:

Payment Guaranty LETTER OF GUARANTY NO.__________________

The undersigned, acting as the duly authorized representative of the bank, declares that the bank hereby guarantees to effect payment to the Contracting Officer by check made payable to the Treasurer of the United States, immediately upon demand after receipt of a simple written request from the Contracting Officer, immediately and entirely without any need for the Contracting Officer to protest or to take any legal action or obtain the prior consent of the Contractor or for any other proof, action, or decision by any other authority, up to the sum of Amount Equal to twenty percent (20%) of the Contract Price in U.S. Dollars but not to exceed $2,500,000), which represents the deposit required of the Contractor to guarantee payment by the Contractor to all Persons, firms. or corporations supplying labor and material under Contract (Contract No. ) for (Description of Work) at (Location of Work) in strict compliance with the terms, conditions, and specifications of said contract, entered into between the Government and (Name of Contract of (Address of Contractor) on (Contract Date) plus legal charges of 10% per annum on the amount called due, calculated from the sixth day following receipt of the Contracting officer’s written request until the date of payment.

The undersigned agrees and consents that said contract may be modified by Change Order or Supplement! Agreement without affecting the validity of this guaranty provided. however, that the amount of this guaranty shall remain unchanged.

The undersigned agrees and consents that the Contracting Officer may make repeated partial demands on the guaranty up to the total amount of this guarantee, and the bank will promptly honor each individual demand.

This letter of guaranty shall remain in effect until the essential completion of the Contractor’s performance of Contract (number).

The undersigned certifies that the guaranty is issued by a depository institution located in and authorized to do business in any state of the United States or the District of Columbia. and authorized to issue such checks or Letters of Guaranty by the banking laws of the United States or any state of the United States.

Bank (depository institution) :

Legal Name & Address

Location:

State of Incorporation

Signature(s) ______________________________ Corporate Seal:

Name(s) ______________________________

Title(s) ______________________________

NOTE: CERTIFICATE OF AUTHORITY IS ATTACHED EVIDENCING AUTHORITY OF THE SIGNER TO BIND THE BANK TO THIS DOCUMENT