BONDS CONSENT OF SURETY AND INCREASE OF PENALTY Modification No. Contract No. dated _) and The surety [cosureties] hereby consents [consent] to the foregoing contract modification and agrees [agree] that its [their] bond or bonds shall apply and extend to the contract as thereby modified or amended. The principal and the surety [cosureties] further agree that on and after the execution of this consent, the penalty of the aforementioned performance bond or bonds is hereby increased by dollars ($ the penalty of the aforementioned payment bond or bonds is hereby increased by dollars ($ _). Provided, however, that the increase of the liability of each cosurety resulting from this consent shall not exceed the sums set forth below: INCREASE IN LIABILITY INCREASE IN LIABILITY LIMIT UNDER PERFORM- LIMIT UNDER PAYMENT ANCE BOND BOND NAME OF *This Consent of Surety and Increase of Penalty shall be executed by the principal or his authorized representative concurrent with the execution of the attached modification NASA PROCUREMENT REGULATION 10.111-1 BONDS AND INSURANCE to which it pertains. If the individual who signs the consent is signing in a representative capacity (e.g., attorney in fact), but is not a member of the firm, partnership, or joint venture, or an officer of the corporation involved, a Power of Attorney or Certificate of Corporate Principal, as appropriate, shall be submitted with the consent. 10.111-2 Consent of Surety. The following consent of surety shall be obtained from the surety or sureties on existing bonds in connection with any amendment, modification or supplemental agreement if: (i) additional bond is obtained from other than the original surety; (ii) no additional bond is required and (A) the modification is for new or additional work beyond the scope of the contract, or (B) the modification does not enlarge or diminish the scope of the contract, but changes the contract price (upward or downward) by more than $25,000 or 10 percent of the contract price; or (iii) consent of surety is required in connection with a novation agreement (see 26.402(b)(x)). If there is more than one surety on the bond or bonds, the cosureties may either execute a separate consent in the form here prescribed, or they may join in executing a single such consent using the words in brackets and adding additional executions of sureties similar to that set forth in the form. The surety [cosureties] hereby consents [consent] to the foregoing contract modification and the surety [sureties] agrees [agree] that its [their] bond or bonds shall apply and extend to the contract as thereby modified or amended. (Type Name and Title of Person Executing) (Add similar signature blocks for cosureties.) 10.111-3 Additional Bond-New Surety. If additional bond coverage is required and will be furnished in hole or in part by a new surety, such surety must furnish its first bond coverage on a standard bond form (Standard Form 25 or 25-A, as appropriate). 10.112 Execution and Administration of Bonds and Consents of Surety. 10.111-2 CFR TITLE 41 CHAPTER 18 BONDS (a) Execution. Several prescribed forms for bonds and related documents are listed in 16.805. Bonds and related documents executed on such forms shall comply with the instructions accompanying each form. The IFB or RFP may provide for execution and submission of more than one copy if desired. When required by Instruction Number 2 of the standard bond forms, the evidence of authority of a principal's representatives shall be a duly executed power of attorney reciting that the individual executing the bond or consent of surety is authorized to do so. A corporation, in lieu of such power of attorney, may submit a "Certificate as to Corporate Principal" in the format prescribed in (c) below. (b) Administration. It is the responsibility of the contracting officer to obtain all bonds required by law and regulation. The Treasury Department list of corporate sureties certified by the Secretary of the Treasury as being acceptable as sureties on Federal bonds, and provision for the distribution of up-to-date copies of the list, are discussed in 10.201-1. All bonds will be reviewed by the contracting officer to ascertain that the bond is in the penal sum required and, when appropriate, properly describes the contract. The contracting officer shall determine whether the corporate surety which executed the bonds appears on the latest Treasury Department list of acceptable sureties. If the name of the surety does not appear on the list, the Assistant Administrator for Procurement, NASA Headquarters (Code HP) will be advised by the most expeditious means in order to determine from the Surety Bond Section, Treasury Department, whether the corporate surety has been approved subsequent to the issuance of the latest list. When the surety on a bond is not acceptable, the contracting officer shall return the bond to the bidder by letter, advising that the surety on the bond is not acceptable because of lack of Treasury Department approval. When time permits and when it would be to the best interest of the Government, the bidder may be permitted a specific period of time in which to submit an acceptable bond. When a contractor is performing his contract in such a manner as to lead to default, timely notification to the surety may result in action by the surety that will avoid a default. Therefore, on all such contracts, the surety shall be promptly notified of any failure by the contractor to perform (see 8.602-4(i)). (c) Certificate As To Corporate Principal. When a Certificate As To Corporate Principal is to be furnished, the following format shall be used. CERTIFICATE AS TO CORPORATE PRINCIPAL I, (Name)....., certify that I am the (Office held)....., of the corporation named as principal in the (performance) (and) (payment) bond(s); that who signed the said bond(s) on behalf of the principal was then (Capacity in which bond was executed)..... of said corporation; that I know his signature and that his signature thereto is genuine; and that said bond(s) was (were) duly signed, sealed, and attested for and in behalf of said corporation by authority of its governing body. (Affix Corporate Seal) (d) Name of Principal. When a partnership is a principal on a bond, the names of all the members of the firm shall be listed in the bond following the name of the firm and the phrase "a partnership composed of." If a principal is a corporation, the state of incorporation must appear. NASA PROCUREMENT REGULATION 10.111-2 BONDS AND INSURANCE (e) Date of Bond. A performance or payment bond other than an annual bond shall not antedate the contract to which it pertains. (f) Continuation Sheet. The Standard Form 25-B (Continuation Sheet) is prescribed for use when there are more than seven sureties on a bid, performance, or payment bond. It shall also be used when there are cosureties on an annual bid or performance bond. 10.111-2 CFR TITLE 41 CHAPTER 18 Subpart 2-Sureties 10.201 General Requirements of Sureties. Every bond required or used in connection with a contract for supplies, services, or construction shall be supported by good and sufficient surety (corporate or individual) except as provided in 10.202. 10.201-1 Corporate Sureties and Cosureties. (a) In connection with contracts for supplies, services, or construction to be delivered or performed in the United States, its possessions (other than the Canal Zone), or Puerto Rico: (i) solicitations shall not require that only corporate sureties may be furnished or that a particular corporate surety be furnished, except as may be otherwise specifically provided (e.g., position schedule bonds may be obtained only from corporate sureties); and (ii) any corporate surety offered for a bond furnished the Government, or furnished pursuant to a Government contractual requirement, where the contracting officer has authority to approve the sufficiency of the surety, must appear on the Treasury Department List (TD Circular 570) and the amount of the bond must not be in excess of the underwriting limits stated in that list. The Assistant Administrator for Procurement, NASA Headquarters will obtain and distribute up-to-date copies of this list. In connection with contracts to be performed in the Canal Zone, corporate Panamanian surety companies which are acceptable on bonds required by the Panama Canal Company may be accepted in addition to the corporate sureties appearing on the Treasury List. The acceptability of Panamanian sureties shall be subject to the conditions and restrictions (including any requirement for security deposits) similar to those imposed by the Panama Canal Company, and to a determination by the contracting officer that the amount of the bond is commensurate with the underwriting capacity of the surety. For contracts to be performed in a foreign country, sureties not appearing on Treasury Department Circular 570 are acceptable if it is determined by the contracting officer that it is impracticable for the contractor to use Treasury listed sureties. (b) Corporate Cosureties. More than one corporate surety may be accepted as cosurety upon any recognizance, stipulation, bond, or undertaking in connection with contracts for supplies, services, or construction. In no case, however, shall the liability of any such cosurety exceed the maximum penal sum which it is qualified to underwrite on any one obligation. It is not necessary that each corporate surety obligate itself for the full amount of the bond. Each corporate surety may limit its liability in the bond to a specified sum. The sureties must bind themselves jointly and separately for the purpose of allowing a joint action or actions against any or all of them. Where the bond is to be executed by two or more corporate sureties, Standard Form 25 shall be used in the case of a performance bond and Standard Form 25-A in the case of a payment bond. On bonds covering supply or service contracts where the amount of the bond exceeds the underwriting limitation of the corporate surety, the latter may reinsure with a corporation on the acceptable list of corporate sureties having the required reinsurance underwriting capacity. Reinsurance agreements are not acceptable in connection with construction contracts. |