Bid bonds guarantee a contractor and/or supplier when bidding for a particular contract.  The guarantor undertakes to pay the guaranteed amount to the employer, if the Tenderer, usually the contractor, decides to withdraw his Tender before bids are opened or if he fails to provide the employer with a satisfactory performance bond in accordance with the conditions of the contract awarded.  The potential employer asks for a guarantee (normally for 2% to 10%) of the contract price that if a contractor's bid is accepted, it will undertake the contract.  If the contractor defaults and does not undertake the contract, a call is made on the Bond.