PERFORMANCE BOND
PERFORMANCE BOND NO.
AMOUNT OF PERFORMANCE BOND:
WHEREAS,
P.O.BOX
(hereinafter called “The Contractor”) has entered into a certain contract in
writing dated for
(herein after called “the Employer”);
NOW THEREFORE, NILE INSURANCE COMPANY (S.C.) P.O.BOX 12836, ADDIS
ABABA, ETHIOPIA (hereinafter called “THE SURETY”) and the Contractor jointly
and severally bind themselves, their successor and assigns as follows: -
1. If the Contractor shall well and truly and faithfully comply with all terms,
covenants and conditions of the said Contract, on its part to be kept and
performed according to the tenor of the said contract or if on default by the
contractor, the Surety shall satisfy and discharge the damage sustained by
the Employer thereby upto the sum of Birr
then this obligation shall be null and void otherwise it shall remain in
force and virtue.
2. The Contract dated entered into by and between the
Employer and the Contractor with all its covenants and conditions is hereby
made a part of this Bond to all intents and purposes as though the contract
had been incorporated herein, including any duly authorized modifications of
the said Contract that may be made hereafter.
3. THIS BOND is executed by the Surety upon the following express conditions
which shall be conditions precedent to the right of the Employer to recover
hereunder:
3.1 Upon the discovery by the Employer or by the Employer’s agent or
representative, of any act or omission that shall or might involve a loss
hereunder, the Employer shall give immediate written notice thereof with
the fullest information obtainable at the time to Surety.
3.2 If the Contractor shall fail to comply with the provisions of the contract to
such an extent that the contract shall be forfeited, the Surety shall have
the right and opportunity to assume the remainder of the contract and at
its option to perform or sublet the same.
3.3 In the event of any breach of the provisions of the contract the surety
shall be subrogated to all the right and properties of the Contractor
arising out of the contract. All deferred payments and any and all moneys
and properties, that are then, or that may thereafter, become due to the
Contractor under or by virtue of the contract shall be credited upon any
claim that the Employer may make upon the Surety.
3.4 Legal proceedings for recovery hereunder may not be brought unless
begun within twelve months from the time of the discovery of the act or
omission of the Contractor on account of which claim is made; but if the
Surety shall assume the performance of the contract the period within
which legal proceedings for recovery hereunder may be brought shall be
deemed to be extended twelve months beyond the date of failure of the
Surety to perform the said contract.
3.5 The Surety shall not be liable for any damage resulting form strikes or
labour difficulties, or from mobs, riots, fire, the elements, or acts of God or
for the repair or reconstruction of any work or material damaged or
destroyed by any such cause; nor for damages for injury to persons, nor
for the non-performance of any guarantees of the efficiency or wearing
qualities of any work done or material furnished or the maintenance
thereof or repairs thereto, nor for the furnishing of any bond or obligation
other than this instrument.
3.6 No change shall be made in the plans and specifications forming part of
the Contract that shall increase the amount to be paid to the Contractor
by more than 5% unless the Surety’s consent thereto shall be secured in
writing.
3.7 With the exception of the instances where differences may not be
submitted to arbitration according to Art. 315(2) of the code of Civil
Procedure; all differences arising out of this Bond Guarantee shall be
referred to the decision of an Arbitrator to be appointed in writing by the
parties in difference or if they cannot agree upon a single Arbitrator to the
decision of two Arbitrators one to be appointed in writing by each of the
parties within one calendar month after having been requested in writing
so to do by either of the parties or in case the Arbitrators do not agree of
an Umpire appointed in writing by the Arbitrators before entering upon
the reference. The Umpire shall sit with the Arbitrators and preside at
their meeting and the making of an award shall be a condition precedent
to any right or action.
In witness, whereof the Contractor and the Surety have duly executed this Bond,
this day of .
_______________________________ ______________________________
THE CONTRACTOR THE SURETY
(SEAL) (SEAL)
