Pub. Contract Code, § 10314

Any contract for goods to be manufactured by the contractor specially for the state and not suitable for sale to others in the ordinary course of the contractor’s business may provide, on such terms and conditions as the department deems necessary to protect the state’s interests, for progress payments for work performed and costs incurred at the contractor’s shop or plant, provided that not less than 10 percent of the contract price is required to be withheld until final delivery and acceptance of the goods, and provided further, that the contractor is required to submit a faithful performance bond, acceptable to the department, in a sum not less than one-half of the total amount payable under the contract securing the faithful performance of the contract by the contractor.