Free up working capital
| bond type | Commercial Lease Performance bond |
| purpose | Security of Lease - Lease performance bond for first 6 months of the lease rental equivalent to $452,000. |
| bond facility limit |
$452,000 |
| contract value | $452,000 |
| bond value | $452,000 |
| bond amount | $452,000 (equivalent to 6 months rent) |
| bond term | 5 years. |
The client was a successful food manufacturing company in NSW.
The company relocated to a new premise and entered into a lease with the landlord whereby terms of the lease required security in form of a bank guarantee or bond for first 6 months of the lease rental equivalent to $452,000.
The client completed the application form and submitted necessary documents for assessment. Unconditional approval was obtained in 3 days. Draft lease was subsequently forwarded to the lessor for approval. The final bond was issued 3 days later upon payment of fees and premium.
This lease performance bond provided security to the landlord against defaults on the tenancy agreement.
These bonds are cost effective alternative to bank guarantees and do not impose any limitations on a tenant’s working capital.
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