completion bond

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Completion Bonding

A loan guarantee that a project will be paid for even if it is abandoned. Producers or publishers will make this guarantee to a bank in order to secure loans to finance their projects. Completion bonding benefits the bank as it guarantees that its loan will be paid. It also benefits the producer or publisher as the loan generally does not become payable until the project is completed, improving his/her accounting position. Finally, it benefits the person who actually develops a given project as the producer or publisher is discouraged from suddenly terminating that project. This form of financing is common to the video game and film industries.

completion bond

A fidelity bond posted by a contractor or developer to guarantee that a particular project will be completed according to plans and specifications,on time,and without any liens incurred as a result of unpaid bills to subcontractors and suppliers;usually required as a condition of performing government work. It provides more coverage than a simple performance bond, which ensures that one party will perform if the other will perform, usually by payment.The completion bond is independent of any underlying contracts and any defenses to those contracts.

References in periodicals archive ?
Jason Zelin of Completion Bond Company added that they are eager to assist producers in obtaining financing by qualifying them with the banks.
A completion bond is the standard means to assure investors that a film will be completed and distributed even if it runs over budget.
In 1990 he became chief executive of First Australian Completion Bond Co.
Fireman's Fund also owns International Film Guarantors (IFG), a wholly owned subsidiary based in West Los Angeles that offers completion bonds.
We're clearly busier than last year," says Steve Mangel, president and chief operations officer of Independent Film Guarantors, one of the leading completion bond companies.
His topics include training and background, the responsibility of a safe set, how to find and hire a stunt coordinator, completion bonds, falls, precision driving, ethical responsibilities of a director, swords and knives, horses and livestock, and sports.
To protect their investments, independent films depend on completion bonds, while studios rely on independent research companies to conduct polls before a film opens.
Additional leverage to support project construction, including the use of completion bonds, may affect the rating.
Significant delays in construction, escalation in costs, or sizable use of completion bonds may result in rating action.
Project completion bonds are not subject to the ABT.
It offers ancillary support services for projects, such as completion bonds and collection accounts, or other aspects related to its solid legal system.
The city does not have to meet this test if they are issuing completion bonds, provided that such bonds do not exceed 10% of the total principal amount estimated to be required for such improvements.