Maintenance Bond


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Maintenance Bond

A bond that one company issues to another guaranteeing repayment in case some project fails to work properly after a certain period of time. For example, if a company hires a firm to build industrial equipment for a factory, the firm may issue a maintenance bond to the company. If the equipment is not constructed according to specifications and therefore does not function correctly, the company will not incur any losses because the firm must repay the bond. This reduces the risk to the bondholder that another party to a contract will not fulfill its obligations.
References in periodicals archive ?
Performance Payment and Maintenance Bonds (required with the contract)
For now, he said, he's more focused on a $1.2 million maintenance bond on the November election.
The successful bidder must furnish: a 5% Maintenance Bond, a 100% Performance Bond, and a 100% Labor and Materials Payment Bond.
A Maintenance Bond will be required in the amount of 10% of the contract price and is to remain in force for a period of two years from the date of the letter of final acceptance from the City of Leander and Leander MUD No.
Performance Payment and Maintenance Bonds (required with the contract) 100% of awarded Contract Price, or less if applicable requirement or not for maintenance bond requirement for A.M.
In addition to landscape materials, the proposal includes lighting, a performance bond and one-year maintenance bond in accordance with a design by Pond + Company and previously approved by the city council.
Market Detail: The ProSure Group's (www.ProSureGroup.com) coverage for construction bonds can include payment and performance bonds, bid bonds, maintenance bonds, supply bonds, subdivision bonds, site improvement bonds, completion bonds, right of way bonds, service contract bonds, and contractor license bonds.
Maintenance Bonds: Often a contractor must agree to fix any defects in the workmanship for a period of time after the project is complete.
New York: Issue: General Obligation Facilities Maintenance Bonds, Series 2016A; Enhanced Rating: Aa2; Sale Amount: $3,540,000; Expected Sale Date: 03-15-2016; Rating Description: General Obligation
There's a lot wrong with this picture, beginning with the banks and mortgage companies, who have no business passing on the cost of maintenance bonds. Such monies are posted for the sole purpose of ensuring that properties are properly maintained, and are, after all, refundable.
Labor and Material Payment/Performance/ Maintenance Bonds
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