How can a principal be released from a surety bond obligation?

A principal can be released from a surety bond obligation primarily by completing the contract fully. When the principal fulfills their contractual obligations, it serves as the primary way to demonstrate that the terms of the bond have been met, thus allowing for their release. This completion signifies that the surety's duty to ensure that the principal adheres to the contract has been satisfied, and therefore, the surety bond is no longer necessary.

While other options may seem viable, they do not effectively address the release process. For instance, paying a fee to the surety might involve modifications or extensions, but it does not constitute a release from obligation. Transferring the bond to another party generally entails assigning responsibility rather than eliminating the original party's obligations. Notifying the obligee of their intent could be part of a process, yet it doesn’t ensure the actual completion of the contract, which is crucial for a genuine release from the bond.