Contractor’s Payment Bond Sample Clauses
A Contractor’s Payment Bond is a contractual guarantee that ensures subcontractors, suppliers, and laborers are paid for their work and materials on a project, even if the contractor fails to fulfill payment obligations. Typically issued by a surety company, this bond requires the surety to cover unpaid amounts up to the bond’s value if the contractor defaults. Its core function is to protect project stakeholders from non-payment risks, thereby promoting trust and financial security throughout the construction process.
Contractor’s Payment Bond. If the construction contract between the Developer and the Contractor for construction of the Community Facilities is for an amount in excess of Twenty-Five Thousand Dollars ($25,000), a good and sufficient Payment Bond in an amount equal to one hundred percent of the total contract price (between the Developer and the Contractor), guaranteeing payment for all labor, materials and equipment used in construction of the Community Facilities. The Payment Bond shall be made in favor of the City and the Developer and all persons, firms or corporations who may furnish materials for or perform labor upon the Community Facilities hereunder.