On large-scale privately-owned Projects (in contrast to government owned public projects), it is not uncommon for the Property Owner to require the Original Contractor to purchase a Payment Bond from a Surety to protect the Property Owner and its Property from Lien claims by guaranteeing the payment of any unpaid Subcontractors, Material Suppliers, Vendors and/or Laborers who timely and properly perfect a claim against the Bond.  To provide the Property Owner with full protection, the Bond must meet the following requirements: (1) be issued by a corporate Surety authorized and admitted to do business in Texas and licensed by the state of Texas to execute Bonds as a Surety; (2) be in the full amount of the overall Prime Contract amount; (3) be written in favor or the Property Owner; (4) be endorsed by the Surety, Property Owner, and Prime Contractor; (5) be conditioned upon prompt payment of all claims; and (6) contain the Surety contact information.  A valid private Payment Bond must also be recorded in the Real Property Records, along with the Prime Contract.  If the Bond complies with the above requirements, then the Property Owner is not required to retain the otherwise mandatory 10% statutory retainage from the Original Contractor’s progress payments and is not required to “trap funds” (withhold) in response to a Subcontractor, Material Supplier, Vendor or Laborer’s Notice of Claim (“Pre-lien”, “Preliminary Notice”, or “Intent to Lien”).