APPENDIX A - TERMS AND CONDITIONS



G. Bonds

     A bid bond, performance bond, or a payment bond may be
     required in a solicitation.  A bid bond, when specified,
     must accompany the bid.  Performance bonds and payment
     bonds, if requested, must be filed in accordance with the
     direction of the Procurement Officer.

     A certified check or cash escrow may be accepted in lieu
     of a bid, payment, or performance bond.  If approved by
     the Attorney General, a bidder may furnish a personal
     bond, property bond, or bank or savings and loan
     association's letter of credit on certain designated funds
     in the face amount required for the bid, payment or
     performance bond. Approval shall be granted only upon a
     determination that the alternative form of security
     offered affords protection to the institution equivalent
     to a corporate surety bond.

     If a performance bond requirement is not stated in the
     solicitation and the institution later determines that a
     bond should be provided prior to the award of a contract,
     the contractor to whom the award will be made shall
     provide a performance bond, and the institution will pay
     the cost of the bond.

     If unusual circumstances arise that necessitate the
     modification of the form and/or wording of the Bond, a
     recommendation containing the necessary modification(s)
     and including written justification must be approved by
     the Procurement Officer and, if appropriate, by legal
     counsel.


1. Performance Bond. Mandatory provision for all construction contracts exceeding $100,000: The required performance bond shall be in the form specified as follows:
PERFORMANCE BOND Principal Business Address of Principal Surety Obligee STATE OF MARYLAND a corporation of the State of By and through the following and authorized to do business in the State Administration of Maryland Penal Sum of Bond (express in words and figures) Date of Contract ______________________ Description of Contract Date Bond Executed Contract Number: KNOW ALL MEN BY THESE PRESENTS, That we, the Principal named above and Surety named above, are held and firmly bound unto the Obligee named above in the Penal Sum of this Performance Bond stated above, for the payment of which Penal Sum we bind ourselves, our heirs, executors, administrators, personal representatives, successors, and assigns, jointly and severally, firmly by these presents. However, where Surety is composed of corporations acting as co-sureties, we, the co-sureties, bind ourselves, our successors and assigns, in such Penal Sum jointly and severally as well as severally only for the purpose of allowing a joint action or actions against any or all of us, and for all other purposes each co-surety binds itself, jointly and severally with the Principal, for the payment of such sum as appears above its name below, but if no limit of liability is indicated, the limit of such liability shall be the full amount of the Penal Sum. WHEREAS, Principal has entered into or will enter into a contract with the State of Maryland, by and through the Administration named above acting for the State of Maryland, which contract is described and dated as shown above, and incorporated herein by reference. The contract and all items incorporated into the contract, together with any and all changes, extensions of time, alterations, modifications, or additions to the contract or to the work to be performed thereunder or to the Plans, Specifications, and Special Provisions, or any of them, or to any other items incorporated into the contract shall hereinafter be referred to as "the Contract." WHEREAS, it is one of the conditions precedent to the final award of the Contract that these presents be executed. NOW, THEREFORE, during the original term of said Contract, during any extensions thereto that may be granted by the Administration, and during the guarantee and warranty period, if any, required under the Contract, unless otherwise stated therein, this Performance Bond shall remain in full force and effect unless and until the following terms and conditions are met: 1. Principal shall well and truly perform the Contract; and 2. Principal and Surety shall comply with the terms and conditions in this Performance Bond. Whenever Principal shall be declared by the Administration to be in default under the Contract, the Surety may, within 15 days after notice of default from the Administration, notify the Administration of its election to either promptly proceed to remedy the default or promptly proceed to complete the contract in accordance with and subject to its terms and conditions. In the event the Surety does not elect to exercise either of the above stated options, then the Administration thereupon shall have the remaining contract work completed, Surety to remain liable hereunder for all expenses of completion up to but not exceeding the penal sum stated above. The Surety hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the Contract or to the work to be performed thereunder or the Specifications accompanying the same shall in any way affect its obligations on this Performance Bond, and it does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the Contract or to the work or to the Specifications. This Performance Bond shall be governed by and construed in accordance with the laws of the State of Maryland and any reference herein to Principal or Surety in the singular shall include all entities in the plural who or which are signatories under the Principal or Surety heading below. IN WITNESS WHEREOF, Principal and Surety have set their hands and seals to this Performance Bond. If any individual is a signatory under the Principal heading below, then each such individual has signed below on his or her own behalf, has set forth below the name of the firm, if any, in whose name he or she is doing business, and has set forth below his or her title as a sole proprietor. If any partnership or joint venture is a signatory under the Principal heading below, then all members of each such partnership or joint venture have signed below, each member has set forth below the name of the partnership or joint venture, and each member has set forth below his or her title as a general partner, limited partner, or member of joint venture, whichever is applicable. If any corporation is a signatory under the Principal or Surety heading below, then each such corporation has caused the following: the corporation's name to be set forth below, a duly authorized representative of the corporation to affix below the corporation's seal and to attach hereto a notarized corporate resolution or power of attorney authorizing such action, and each such duly authorized representative to sign below and to set forth below his or her title as a representative of the corporation. If any individual acts as a witness to any signature below, then each such individual has signed below and has set forth below his or her title as a witness. All of the above has been done as of the Date of Bond shown above. In Presence of: Individual Principal Witness ______________________________as to ________________________(SEAL) In Presence of: Co-Partnership Principal Witness ________________________(SEAL) (Name of Co-Partnership) ____________________________ as to By:______________________(SEAL) ____________________________ as to ________________________(SEAL) ____________________________ as to ________________________(SEAL) Corporate Principal ______________________________ Attest: (Name of Corporation) AFFIX ____________________________ as to By:____________________CORPORATE Corporate Secretary President SEAL _______________________________ (Surety) AFFIX Attest: (SEAL) By:_____________________CORPORATE SEAL _____________________________________ Title__________________________ Signature Bonding Agent's Name:________________ _______________________________ (Business Address of Surety) Agent's Address _____________________ Approved as to legal form and sufficiency this ____ day of ____ _________ ______________________________ Asst. Attorney General
2. Payment Bond. The required payment bond shall be in the form specified as follows:
PAYMENT BOND Principal Business Address of Principal Surety Obligee STATE OF MARYLAND a corporation of the State of By and through the following and authorized to do business in the State Administration of Maryland Penal Sum of Bond (express in words and figures) Date of Contract ______________________ Description of Contract Date Bond Executed Contract Number: KNOW ALL MEN BY THESE PRESENTS, That we, the Principal named above and Surety named above, being authorized to do business in Maryland, and having business addresses as shown above, are held and firmly bound unto the Obligee named above, for the use and benefit of claimants as hereinafter defined, in the Penal Sum of this Payment Bond stated above, for the payment of which Penal Sum we bind ourselves, our heirs, executors, administrators, personal representatives, successors, and assigns, jointly and severally, firmly by these co-sureties, bind ourselves, our successors and assigns, in such Penal Sum jointly and severally as well as severally only for the purpose of allowing a joint action or actions against any or all of us, and for all other purposes each co-surety binds itself, jointly and severally with the Principal, for the payment of such sum as appears above its name below, but if no limit of liability is indicated, the limit of such liability shall be the full amount of the Penal Sum. WHEREAS, Principal has entered into or will enter into a contract with the State, by and through the Administration named above acting for the State of Maryland, which contract is described and dated as shown above, and incorporated herein by reference. The contract and all items incorporated into the contract, together with any and all changes, extensions of time, alterations, modifications, or additions to the contract or to the work to be performed thereunder or to the Plans, Specifications, and Special Provisions, or any of them, or to any other items incorporated into the contract shall hereinafter be referred to as the "Contract." WHEREAS, it is one of the conditions precedent to the final award of the Contract that these presents be executed. NOW, THEREFORE, the condition of this obligation is such that if the Principal shall promptly make payment to all claimants as hereinafter defined, for all labor and materials furnished, supplied and reasonably required for use in the performance of the Contract, then this obligation shall be null and void; otherwise it shall remain in full force and effect, subject to the following conditions: 1. A claimant is defined to be any and all of those persons supplying labor and materials (including lessors of the equipment to the extent of the fair market value thereof) to the Principal or its subcontractors and subcontractors in the prosecution of the work provided for in the Contract, entitled to the protection provided by Section 9-113 of the Real Property Article of the Annotated Code of Maryland, as from time to time amended. 2. The above named Principal and Surety hereby jointly and severally agree with the Obligee that every claimant as herein defined, who has not been paid in full may, pursuant to and when in compliance with the provisions of the aforesaid Section 9-113, sue on this Bond for the use of such claimant, prosecute the suit to final judgment for such sum or sums as may be justly due claimant and have execution thereon. The Obligee shall not be liable for the payment of any costs or expenses of any such suit. The Surety hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the Contract or to the work to be performed thereunder or the Specifications accompanying the same shall in any way affect its obligations on this Payment Bond, and it does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the Contract or to the work or to the Specifications. This Payment Bond shall be governed by and construed in accordance with the laws of the State of Maryland and any reference herein to Principal or Surety in the singular shall include all entities in the plural who or which are signatories under the Principal or Surety heading below. IN WITNESS WHEREOF, Principal and Surety have set their hands and seals to this Payment Bond. If any individual is a signatory under the Principal heading below, then each such individual has signed below on his or her own behalf, has set forth below the name of the firm, if any, in whose name he or she is doing business, and has set forth below his or her title as a sole proprietor. If any partnership or joint venture is a signatory under the Principal heading below, then all members of each such partnership or joint venture have signed below, each member has set forth below the name of the partnership or joint venture, and each member has set forth below his or her title as a general partner, limited partner, or member of joint venture, whichever is applicable. If any corporation is a signatory under the Principal or Surety heading below, then each such corporation has caused the following: the corporation's name to be set forth below, a duly authorized representative of the corporation to affix below the corporation's seal and to attach hereto a notarized corporate resolution or power of attorney authorizing such action, and each such duly authorized representative to sign below and to set forth below his or her title as a representative of the corporation. If any individual acts as a witness to any signature below, then each such individual has signed below and has set forth below his or her title as a witness. All of the above has been done as of the Date of Bond shown above. In Presence of: Individual Principal In Presence of: Individual Principal Witness ______________________________as to ___________________(SEAL) In Presence of: Co-Partnership Principal Witness ____________________(SEAL) (Name of Co-Partnership) ____________________________ as to By:_________________(SEAL) ____________________________ as to _________________(SEAL) ____________________________ as to _________________(SEAL) Corporate Principal __________________________ Attest: (Name of Corporation) AFFIX ____________________________ as to By:_______________CORPORATE Corporate Secretary President SEAL _______________________ (Surety) AFFIX Attest: (SEAL) By:_______________CORPORATE SEAL ____________________________________ Title___________________ Signature Bonding Agent's Name:__________________ ________________________ (Business Address of Surety) Agent's Address ________________________ Approved as to legal form and sufficiency this ____ day of ____ _____ ____________________________ Asst. Attorney General
3. Bid Bond a. Solicitations for construction contracts reasonably expected by the procurement officer to exceed $100,000 shall contain the following notice of bid security requirements (See COMAR 21.06.07). b. Solicitations for all other contracts reasonably expected by the procurement officer to exceed $50,000 and for which the procurement officer determines a bid security shall be required, shall also contain the following notice of bid security requirements. c. Notwithstanding A and B of this regulation, notice of bid security is required if a federal law or a condition of federal assistance for the contract requires it. d. The bid bond shall be in the following form:
UNIVERSITY SYSTEM OF MARYLAND BID BOND Bid No. Bond No. ______________ KNOW ALL MEN BY THESE PRESENTS: that we,_______________________________as Principal, hereinafter called the Principal, and _____________________ a corporation duly organized under the laws of the State of __________________________, as Surety, hereinafter called the Surety, are held and firmly bound unto the State of Maryland, hereinafter called "State", for the sum of ___________________,for the payment of which sum, the said Principal and the said Surety bind ourselves, our heirs, executors, administrators, successors and assigns, jointly and severally, firmly by these presents. WHEREAS, the Principal has submitted a bid for: NOW, THEREFORE, if the Principal, upon acceptance by the State of its bid identified above, within the period specified herein for acceptance one hundred and twenty (120) days, if no period is specified, shall execute such further contractual documents, if any, and give such bond(s) as may be required by the terms of the bid as accepted within the time specified ten (10) days if no period is specified after receipt of the forms, or in the event of failure so to execute such further contractual documents and give such bonds, if the Principal shall pay the State for any cost of procuring the work which exceeds the amount of its bid, then the above obligation shall be void and of no effect. The Surety executing this instrument hereby agrees that its obligation shall not be impaired by any extension(s) of the time for acceptance of the bid that the Principal may grant to the State, notice of which extension(s) to the Surety being hereby waived; provided that such waiver of notice shall apply only with respect to extensions aggregating not more than one hundred and twenty (120) calendar days in addition to the period originally allowed for acceptance of the bid. In Presence of: Individual Principal Witness __________________________as to ____________________(SEAL) In Presence of: Co-Partnership Principal Witness ____________________(SEAL) (Name of Co-Partnership) __________________as to BY:_________________(SEAL) __________________as to BY:_________________(SEAL) __________________as to BY:_________________(SEAL) Corporate Principal _______________________ Attest: (Name of Corporation) AFFIX __________________as to BY:_______________CORPORATE Corporate Secretary President SEAL ____________________ (Surety) AFFIX Attest: (SEAL) By:_______________CORPORATE SEAL ___________________________ Title _________________ Signature ___________________________ ______________________ (Printed or Typed Name) (Printed or Typed Name) Bonding Agent's Name:______________ ______________________ (Business Address of Surety) Agent's Address: __________________ ______________________ (Telephone Number) Telephone Number: _________________