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Bid Submission Bond

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BID SUBMISSION BOND

RECITALS

WHEREAS, Principal Name: , whose principal place of business is Principal Address: , has submitted a bid to Obligee Name: for Project: (Project No.: ) on Bid Date: .

WHEREAS, Principal is required to furnish security conditioned upon the execution of the contract in the event Principal is awarded the contract; and WHEREAS, Surety Name: , with offices at Surety Address: , is willing to provide such security.

NOW, THEREFORE, the Principal and Surety (collectively, the Obligers) are held and firmly bound unto Obligee in the penal sum of: $ (the "Penal Sum"), for payment of which sum well and truly to be made, the Principal and Surety bind themselves, their heirs, executors, administrators, successors and assigns, jointly and severally.

SCOPE OF WORK

CONDITIONS OF BOND

This Bond is conditioned upon the Principal's bid and the following terms: If Principal, upon acceptance of its bid within the period specified in the bidding documents, fails to execute and deliver the contract and any required bonds and certificates within the time required, or fails to furnish the required payment and performance bonds, then the Surety shall, within the contract time specified in the bidding documents, and upon written demand by Obligee, pay to Obligee the Penal Sum or such lesser amount as may be required under the applicable provisions of the bidding documents; provided, however, that the Surety's obligation under this Bond shall not exceed the Penal Sum identified above.

PAYMENT TERMS

TERM AND TERMINATION

This Bond shall become effective on Start Date: and shall remain in full force and effect until End Date: , or until released in writing by Obligee upon fulfillment of Principal's obligations. This Bond may be terminated by written notice from Surety to Obligee and Principal not less than Notice Period (days): days prior to the intended termination date; provided, however, that termination shall not relieve Surety of liability for obligations accruing prior to the effective date of termination.

CONFIDENTIALITY

The parties acknowledge that certain non-public business, financial and technical information may be exchanged in connection with the bid and this Bond. Except as required by applicable law or the enforceable order of a court of competent jurisdiction, Obligee, Principal and Surety agree to hold in confidence and not disclose such confidential information to third parties, and to use such confidential information solely for purposes related to the bid, contract award and enforcement of this Bond. Confidential information does not include information that (i) is or becomes generally known to the public through no act or omission of the receiving party; (ii) was known to the receiving party prior to disclosure under this Bond; or (iii) is independently developed by the receiving party without use of the disclosing party's confidential information.

CLAIMS PROCEDURE

Any claim by Obligee under this Bond must be made in writing to Surety at the address set forth above and must include a copy of the Obligee's written demand for payment, a copy of the notice of award to Principal (if applicable), and documentation evidencing Principal's failure to perform the obligations set forth in the bidding documents. Payment shall be made by Surety within Thirty (30) calendar days after receipt of a proper written claim unless Good Cause for denial or delay is demonstrated in writing by Surety.

GOVERNING LAW

This Bond shall be governed by and construed in accordance with the laws of the State of Governing Law State: without regard to its conflict of law principles.

ENTIRE AGREEMENT

This Bond, together with the Principal's bid and the bidding documents incorporated herein by reference, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations or agreements, whether written or oral. Any amendment to this Bond must be in writing and signed by both Principal and Surety.

ADDITIONAL INFORMATION

Principal (Bidder):

By:

Date:

Surety (Guarantor):

By:

Date:

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What a Bid Submission Bond Is and when it matters

A Bid Submission Bond is a surety instrument a bidder submits with a procurement proposal to guarantee that, if awarded, the bidder will enter the contract and obtain required performance and payment bonds. The bond gives the obligee financial assurance against bidder withdrawal or failure to execute, typically for a set bid validity period. A licensed surety issues and signs the bond, often attaching a power of attorney and underwriting documentation; owners and procurement officers rely on the bond to reduce award risk and provide immediate recourse if the bidder defaults.

Why projects require a Bid Submission Bond

A Bid Submission Bond protects the owner by ensuring bidders commit to their offers, deterring speculative or non‑performing bids and providing a monetary remedy if a successful bidder refuses to proceed. It supports fair competition, stabilizes procurement schedules, and reduces the administrative burden of re-soliciting or negotiating after award.

Why projects require a Bid Submission Bond

Who prepares and relies on Bid Submission Bonds

Typical users include project owners, general contractors, subcontractors, and procurement officers responsible for public and private construction bids.

  • Project owners and public agencies — require bonds for bidder assurance and financial protection during award.
  • General contractors — submit bonds to qualify for prime contracts and confirm intent to perform if awarded.
  • Sureties and subcontractors — sureties issue and underwrite; subcontractors may provide information supporting the principal's credit.

Each party has a specific role: owners require the bond, bidders obtain and submit it, and sureties underwrite and back the obligation.

Core elements every professional Bid Submission Bond should include

A compliant bond clearly identifies parties, monetary obligation, effective period, triggering conditions, and the surety's authority so owners and sureties can enforce rights and process claims without ambiguity.

Parties

Names and roles of obligee (owner), principal (bidder), and surety, with legal addresses and contact information for each party.

Bond Amount

The penal sum expressed as a dollar figure or percentage of the bid — the enforceable maximum the surety may be liable for under the bond.

Effective Period

Start and expiry dates or a defined bid validity period; specifies how long the bond secures the bid and when claims may be presented.

Conditions

Clear statement of obligations that trigger payment, typically failure to execute contract or failure to furnish required performance/payment bonds after award.

Surety Signature

Authorized signature block for the surety, corporate seal where required, and an attached power of attorney demonstrating signatory authority.

Reference Documents

Cross‑references to the solicitation, bid number, project location, and any indemnity agreement or underwriting exhibits forming part of the bond.

Required information typically listed on the bond

Bidder legal name: Exact entity name
Bid amount: Numeric amount with currency
Project identifier: Project name and location
Obligee name: Owner or procurement authority
Surety details: Company name and bond number
Effective date: MM/DD/YYYY format

Step-by-step: preparing and submitting a Bid Submission Bond

Follow these steps to prepare a compliant Bid Submission Bond and include it with your bid package to avoid disqualification and accelerate procurement review.

  • 01
    Gather documents: Collect solicitation, bid form, bidder underwriting data, and surety POA.
  • 02
    Obtain surety: Request quote and underwriting approval from an admitted surety.
  • 03
    Complete bond form: Fill all required fields, attach POA, and confirm authorized signature.
  • 04
    Submit with bid: Deliver per solicitation: physical, procurement portal, or accepted electronic method.

Customizing and completing the bond online

When using an electronic workflow, configure the document and signer roles to match procurement requirements and ensure a verifiable audit trail.

Field | Online Setting Action | Recommended value
Upload source Upload a certified PDF or DOCX copy of the bond form
Pre-fill template Create reusable template with static obligee and project fields
Attach POA Upload power of attorney as supporting document
Signer roles Assign surety signer and reviewer with distinct authentication
Authentication Require email + SMS or ID verification for surety signer

Digital signing and acceptable formats for e‑submission

Confirm the solicitation accepts electronic submission and follow the stated file formats, signature requirements, and authentication levels.

  • Accepted formats: PDF and DOCX are typically accepted
  • Authentication: Use multi-factor or ID verification where required
  • Audit trail: Retain timestamps, IP, and signer events

Where to send or file the completed Bid Submission Bond

Route the executed bond according to the solicitation: typically to the procurement office and include a copy for your surety. Electronic portals may accept uploads or signing links where the solicitation permits.

  • Procurement office: Submit the signed bond with your bid package per instructions
  • Surety file: Retain a copy with surety underwriting and claims contact
  • Electronic portal: Upload to the designated eProcurement system if allowed
  • Bid envelope: For physical submissions place bond in sealed bid envelope

Key deadlines and timing considerations

Observe solicitation timelines and bond validity requirements closely; late, expired, or improperly executed bonds commonly lead to bid rejection.

Bid opening date:

Submit by time and date specified in solicitation

Bond validity period:

Often 60–120 days or as the solicitation requires

Post-award bonding:

Performance/payment bonds usually due within 7–30 days after award

Claims window:

Owners may present claims during contract award or within validity period

Underwriting lead time:

Obtain surety approval days or weeks before bid submission

Milestones from bid preparation through claim resolution

A simple milestone sequence shows the critical stages where the bond matters and where documentation must be preserved.

01

Pre-bid preparation

Assemble documents and obtain surety underwriting prior to bid deadline.

02

Submission and bonding

Deliver the executed bond with the bid package before the opening date.

03

Award and conversion

If awarded, principal typically must furnish performance/payment bonds within required days.

04

Claim and resolution

Owner presents claim; surety investigates and resolves or pays per bond terms.

Common mistakes to avoid when preparing a Bid Submission Bond

  • Submitting an unsigned or undated bond — missing signatures frequently cause immediate rejection and inability to enforce.
  • Mismatched names between the bid and bond — using trade names or abbreviations can invalidate the surety obligation in a claim.
  • Failing to attach the surety power of attorney — the absence of POA often prevents the bond from being accepted.
  • Relying on an unlicensed or non‑admitted surety for the jurisdiction — regulatory noncompliance can nullify the bond.

Penalties and risks of incorrect or missing bid bonds

Bid rejection: Possible immediate disqualification
Forfeiture risk: Owner may collect penal sum
Contract rescission: Award may be revoked
Surety claim: Indemnity obligations may attach
Debarment: Repeat failures risk debarment
Litigation costs: Defense and claim resolution expenses

Comparing eSignature vendor basics for Bid Submission Bond workflows

Basic vendor features and typical starting prices to consider when selecting an eSignature provider for bond preparation and secure submission.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day free trial Free trial available Free trial available Free trial available Free trial available
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Frequently asked questions about Bid Submission Bonds

Answers to common questions about enforceability, electronic submission, signer authority, revocation, and what happens if a bidder withdraws.


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