bid bond

Also found in: Encyclopedia.

Bid bond

A bid "performance" bond consisting of a small percentage (1-3%) of the tender contract price, refunded to losers once the contract is awarded.

Bid Bond

A bond that a bidder to a construction project buys to guarantee that it has the means to complete the project should it be awarded the contract. The amount of a bid bond is a certain percentage of the price of the contract. It exists to reassure the company awarding the contract that the bidder has the cash flow needed for the project. The bidder is reimbursed for the bid bond if it does not receive the contract.

bid bond

A type of bond required in some government construction projects.If required,it must be filed at the same time as the bid.This protects the agency in the event the bidder fails or refuses to enter into a contract after being offered it or withdraws the bid before the award.The bonding company will then pay the agency the difference between the defaulting low bid and the next highest bid,whose bidder will be given the contract.

References in periodicals archive ?
The Court of Federal Claims (COFC) declined to impute an insurance broker's questionable conduct to a bidder whose bid a contracting officer determined to be nonresponsive because the amount of the contractor's bid bond exceeded the amount authorized by their surety.
In this case arising out of a construction and repair contract at the Fresno Air National Guard Station, Aeroplate submitted a bid bond to cover the value of its apparent winning bid of $7.
6) The COFC went on to address the government's "unclean hands" argument and stated that although the broker knew they were submitting a bid bond that exceeded the surety's authorization, there was no evidence that the bidder knew that the bid bond exceeded the surety's authorization.
00, then only a bid bond is acceptable, otherwise, a certified check, bank draft or letter of credit shall be for ten percent (10%) of the amount bid.
Bid Bonds are required for all bids in excess of $50,000.
Information on security: The Purchaser requires a bid bond in the amount of the croup.
Deposits and Guarantees required: - Bid bond worth EUR 36 852 in case of supply and the four (4) species.
Bid bond worth EUR 3 240 in case of supply of one kind.
Bid bond worth EUR 10 656 in case of supply of article 2.
The contracting authority shall require contractors bid bond in the amount of 11 000 PLN.
For the task 3 - Employer withdraws from the bid bond request