Performance bonds

1. As a result of a risk management analysis prior to the solicitation being issued, the successful bidder or offeror may be required to file a performance bond, certified check, or cashier's check drawn on the Bank of North Dakota or a federally insured bank, or other form of surety deposit acceptable to the purchasing agency. 2. The state may require that the bond, certified check, or cashier's check be filed within a specified number of days after the award is made or the contract may be canceled and the vendor will be liable for any damages caused by failure to file the bond, certified check, or cashier's check. 3. When a performance bond is required, the solicitation must specify the form and amount of the bond. The amount of the performance bond must be adequate to cover the risk assumed by the state, depending on the nature and circumstances of the contract, up to one hundred percent of the contract amount. 4. The successful bidder or offeror must sign any bid bond as principal, and the bond must be signed by a surety company licensed by the insurance commissioner to do business in the state. If the surety on a bond has its authority to do business in this state revoked or if for any reason it ceases to do business in the state, the bidder or offeror must promptly obtain another surety on the bond. The bond must be noncancelable, regardless as to whether the bonding company remains licensed in the state, and must remain in effect until a replacement bond is filed. 5. The bond must be conditioned on full performance of all obligations imposed on the vendor by the contract with the state. The bond must provide that if the vendor fails to perform any obligations, the state may recover from the vendor and the surety, or either of them, any damages suffered because of failure to perform.