An unconditional bond or bank guarantee required of many contractors and
sellers by overseas buyers to guarantee the tender (the actual form of money
exchanged) as security against the value of advance payments under a contract,
or to guarantee performance of the contract. Payable "on demand,"
these bonds and guarantees may be called even when the contract has not been
breached or when the breach is caused by circumstances outside the
contractor's or seller's control, such as a trading embargo.