As used in this chapter, unless the context otherwise requires:

(1) “Bid bond” means a bond conditioned upon the entering into a contract by a bidder, if the bidder receives the award thereof, and furnishing the prescribed payment bond and performance bond;

Terms Used In Tennessee Code 4-26-102

  • Bid bond: means a bond conditioned upon the entering into a contract by a bidder, if the bidder receives the award thereof, and furnishing the prescribed payment bond and performance bond. See Tennessee Code 4-26-102
  • Commissioner: means the commissioner of economic and community development. See Tennessee Code 4-26-102
  • Contract: A legal written agreement that becomes binding when signed.
  • Department: means the department of economic and community development. See Tennessee Code 4-26-102
  • Director: means the director of the office of business enterprise. See Tennessee Code 4-26-102
  • Disability: means a physical impairment that, in the written opinion of a person's licensed physician, substantially limits one (1) or more of the major life activities of such person and is expected to continue to exist for more than five (5) years. See Tennessee Code 4-26-102
  • major life activities: means caring for oneself and performing manual tasks, which includes writing, walking, seeing, hearing, speaking, and breathing. See Tennessee Code 4-26-102
  • Minor: means any person who has not attained eighteen (18) years of age. See Tennessee Code 1-3-105
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Obligee: means :
    (A) In the case of a bid bond, the person requesting bids for the performance of a contract. See Tennessee Code 4-26-102
  • Payment bond: means a bond conditioned upon the payment by the principal of money to persons under contract with the principal. See Tennessee Code 4-26-102
  • Performance bond: means a bond conditioned upon the completion by the principal of a contract in accordance with its terms. See Tennessee Code 4-26-102
  • Person: includes a corporation, firm, company or association. See Tennessee Code 1-3-105
  • Prime contractor: means the person with whom the obligee has contracted to perform the contract. See Tennessee Code 4-26-102
  • Principal: means :
    (i) In the case of a bid bond, a person bidding for the award of a contract. See Tennessee Code 4-26-102
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Subcontractor: means a person who has contracted with a prime contractor or with another subcontractor to perform a contract. See Tennessee Code 4-26-102
  • Surety: means the person who:
    (A) Under the terms of a bid bond, undertakes to pay a sum of money to the obligee in the event the principal breaches the conditions of the bond. See Tennessee Code 4-26-102
  • written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(2) “Commissioner” means the commissioner of economic and community development;
(3) “Department” means the department of economic and community development;
(4) “Director” means the director of the office of business enterprise;
(5) “Disability” means a physical impairment that, in the written opinion of a person‘s licensed physician, substantially limits one (1) or more of the major life activities of such person and is expected to continue to exist for more than five (5) years. As used in this subdivision (5), “major life activities” means caring for oneself and performing manual tasks, which includes writing, walking, seeing, hearing, speaking, and breathing;
(6) “Disadvantaged business” means a business that is solely owned, or at least fifty-one percent (51%) of the outstanding stock of which is owned, by a person who is either:

(A) By reason of social background unable to obtain technical, business or financial assistance of a quality or quantity similar to that available to the average business;
(B) Impeded from normal entry into the economic mainstream because of past practices of discrimination based on race, religion, ethnic background, sex or service in the armed forces during the Vietnam war; provided, that it is not the policy of this state to encourage employment outside the home of mothers of minor children;
(C) Unable to compete effectively because of tendencies of regular financing and commercial organizations to restrict their services to established businesses;
(D) In a state of chronically low income because of long residence in an urban area with high unemployment and low income; or
(E) Impeded from normal entry into the economic mainstream because of a disability;
(7) “Obligee” means:

(A) In the case of a bid bond, the person requesting bids for the performance of a contract; or
(B) In the case of a payment bond or performance bond, the person who has contracted with a principal for the completion of the contract and to whom the obligation of the surety runs in the event of a breach by the principal of the conditions of a payment bond or performance bond;
(8) “Payment bond” means a bond conditioned upon the payment by the principal of money to persons under contract with the principal;
(9) “Performance bond” means a bond conditioned upon the completion by the principal of a contract in accordance with its terms;
(10) “Prime contractor” means the person with whom the obligee has contracted to perform the contract;
(11)

(A) “Principal” means:

(i) In the case of a bid bond, a person bidding for the award of a contract; or
(ii) The person primarily liable to complete a contract for the obligee, or to make payments to other persons in respect of such contract, and for whose performance of such person’s obligation the surety is bound under the terms of a payment or performance bond;
(B) A principal may be a prime contractor or a subcontractor;
(12) “Subcontractor” means a person who has contracted with a prime contractor or with another subcontractor to perform a contract; and
(13) “Surety” means the person who:

(A) Under the terms of a bid bond, undertakes to pay a sum of money to the obligee in the event the principal breaches the conditions of the bond;
(B) Under the terms of a performance bond, undertakes to incur the cost of fulfilling the terms of a contract in the event the principal breaches the conditions of the contract; or
(C) Under the terms of a payment bond, undertakes to make payment to all persons supplying labor and material in the prosecution of the work provided for in the contract if the principal fails to make prompt payment.
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