Retention

PRO FORMA RETENTION MONEY GUARANTEE

ISSUED TO : ........................................................................ (hereinafter referred to as "the Employer")

ON BEHALF OF:.................................................................... (hereinafter referred to as "the Contractor")

in connection with

CONTRACT NO ..................................................................... (hereinafter referred to as "the Contract")

WHEREAS the Employer and the Contractor have agreed that the Contractor may provide a guarantee in lieu of the whole or portion of the retention monies provided for under the Contract;

NOW THEREFORE we, the undersigned, undertake, in accordance with the following provisions, to pay to the Employer such amounts as the Employer may, from time to time, demand from us.

1. Each demand by the Employer shall be in writing signed by the Employer and delivered to us at
........................................................................................................................................................... or such
other address in ............................................................... as we shall in writing notify to the Employer
and shall be accompanied by a certificate complying with Clause 2, signed by the Engineer in office as such
in terms of the Contract.

2. The Engineer's certificate referred to in Clause 1 shall certify

(a) that he is the Engineer in office as such in terms of the Contract,

(b) that the Contractor is in breach of his obligations under the Contract, and

(c) that the amount demanded, which amount the certificate shall specify,

(i) does not exceed the amount of retention monies which, but for this guarantee, would have been
retained by the Employer in terms of the Contract at the date of the certificate, less the aggregate of
the amounts of retention money actually retained by the Employer and the amounts previously paid by
us to the Employer in terms hereof, and

(ii) does not exceed a genuine estimate of the cost to the Employer of having the breach referred to in
paragraph (b) remedied less the aggregate of any amounts withheld by the Employer from payments
due to the Contractor in terms of the Contract by reason of the breach referred to, and any amount
of retention money actually held by the Employer save to the extent that the same had been
deducted from any previous demand in terms hereof.

3. We shall within ...... days after our receipt of a demand complying with the provisions of Clauses 1 and 2
make payment to the Employer of the amount demanded at ........................................ or at such other
address in .............................. as the Employer shall in writing notify to us.

4. Subject to compliance with the provisions hereof, our liability to make the payments herein referred to shall
be unconditional and shall not be affected or diminished by any disputes, claims or counterclaims between
the Employer and the Contractor.

5. Our aggregate liability under this guarantee is limited to R .................................................................

6. This guarantee shall expire on the date on which the last of the retention monies, which but for this
guarantee would have been retained by the Employer, becomes payable to the Contractor.

7. This guarantee is not transferable and must be produced for endorsement if any part payment is made and
must be returned to us against final payment of our aggregate liability or on the date of the expiry of the
guarantee in terms of Clause 6, whichever is the earlier.

Signed in the presence of the subscribing witnesses:

At ..................................................... for and on behalf of ..............................................................
on this ........... day of ............................... 20......

Signature .........................................................
Capacity ..........................................................
Address ...........................................................
...........................................................
As witnesses:

1 . .............................................

2. ..............................................

Copyright: South African Institution of Civil Engineering.

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	PRO FORMA RETENTION MONEY GUARANTEE ISSUED TO : ........................................................................ (hereinafter referred to as "the Employer") ON BEHALF OF:.................................................................... (hereinafter referred to as "the Contractor") in connection with CONTRACT NO ..................................................................... (hereinafter referred to as "the Contract") WHEREAS the Employer and the Contractor have agreed that the Contractor may provide a guarantee in lieu of the whole or portion of the retention monies provided for under the Contract; NOW THEREFORE we, the undersigned, undertake, in accordance with the following provisions, to pay to the Employer such amounts as the Employer may, from time to time, demand from us. 1. Each demand by the Employer shall be in writing signed by the Employer and delivered to us at ........................................................................................................................................................... or such other address in ............................................................... as we shall in writing notify to the Employer and shall be accompanied by a certificate complying with Clause 2, signed by the Engineer in office as such in terms of the Contract. 2. The Engineer's certificate referred to in Clause 1 shall certify (a) that he is the Engineer in office as such in terms of the Contract, (b) that the Contractor is in breach of his obligations under the Contract, and (c) that the amount demanded, which amount the certificate shall specify, (i) does not exceed the amount of retention monies which, but for this guarantee, would have been retained by the Employer in terms of the Contract at the date of the certificate, less the aggregate of the amounts of retention money actually retained by the Employer and the amounts previously paid by us to the Employer in terms hereof, and (ii) does not exceed a genuine estimate of the cost to the Employer of having the breach referred to in paragraph (b) remedied less the aggregate of any amounts withheld by the Employer from payments due to the Contractor in terms of the Contract by reason of the breach referred to, and any amount of retention money actually held by the Employer save to the extent that the same had been deducted from any previous demand in terms hereof. 3. We shall within ...... days after our receipt of a demand complying with the provisions of Clauses 1 and 2 make payment to the Employer of the amount demanded at ........................................ or at such other address in .............................. as the Employer shall in writing notify to us. 4. Subject to compliance with the provisions hereof, our liability to make the payments herein referred to shall be unconditional and shall not be affected or diminished by any disputes, claims or counterclaims between the Employer and the Contractor. 5. Our aggregate liability under this guarantee is limited to R ................................................................. 6. This guarantee shall expire on the date on which the last of the retention monies, which but for this guarantee would have been retained by the Employer, becomes payable to the Contractor. 7. This guarantee is not transferable and must be produced for endorsement if any part payment is made and must be returned to us against final payment of our aggregate liability or on the date of the expiry of the guarantee in terms of Clause 6, whichever is the earlier. Signed in the presence of the subscribing witnesses: At ..................................................... for and on behalf of .............................................................. on this ........... day of ............................... 20...... Signature ......................................................... Capacity .......................................................... Address ........................................................... ........................................................... As witnesses: 1 . ............................................. 2. .............................................. Copyright: South African Institution of Civil Engineering.
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