Introduction

Understanding the format and sample of a bid bond, also known as a tender guarantee, is crucial for businesses involved in bidding processes. In this article, we will provide an overview of the standard format and structure of a bid bond in English.

Heading 1: Basic Information

The bid bond should begin with basic information that includes the name and address of the applicant, also known as the Principal, who is seeking the guarantee. This section should also include the name and address of the Guarantor, usually a financial institution, providing the guarantee.

Heading 2: Reference to the Contract

It is important to clearly reference the contract for which the bid bond is being issued. Include contract details such as the project name, location, contract value, and any specific terms or conditions related to the contract that are relevant to the bid bond.

Heading 3: Guarantee Details

In this section, the bid bond's guarantee amount and validity duration should be specified. The guarantee amount is typically a percentage of the contract value and can vary depending on the requirements set by the contract issuer.

Heading 4: Obligations of the Guarantor

This section outlines the obligations and responsibilities of the Guarantor. It should specify that the Guarantor undertakes to pay the beneficiary (contract issuer) a certain amount if the Principal fails to fulfill their obligations as stated in the bid or refuses to enter into the contract after being awarded.

Heading 5: Limitations and Exclusions

Include any limitations or exclusions that apply to the bid bond. For example, specific circumstances under which the Guarantor's liability is waived or reduced, or any actions or omissions on the Principal's part that may invalidate the guarantee.

Heading 6: Governing Law and Jurisdiction

Specify the jurisdiction under which the bid bond is governed. This section should mention the applicable law and the court or arbitration center where any disputes related to the bid bond will be resolved.

Heading 7: Execution and Delivery

The bid bond should end with a statement mentioning the date of issuance, the signature of authorized representatives of both the Principal and Guarantor, and their respective company seals (if required). This section ensures the legality and authenticity of the bid bond.