In this section of Leviathan, the premise of Hobbes's argument is that covenants extorted by fear are valid in the state of nature, and from this premise, he concludes that such agreements are binding.
In Leviathan, the state of nature is the condition in which men find themselves before constructing a political system that will impose order and stability. In the state of nature, men are constantly at each other's throats, and so there is no security of life, liberty, or property.
That being the case, men decide to get together and form a commonwealth in which they agree to give up their rights to an absolute sovereign in exchange for law and order. Although this arrangement is completely different from how things were in the state of nature, certain similarities remain.
For one thing, covenants entered into are binding in both kinds of society. Even where fear...
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is used to compel us to enter into a covenant, as frequently happens in the state of nature, the agreement is still valid, and we are obliged to fulfill our side of the bargain.
If I should find myself in the unfortunate position of needing to pay a ransom for my life to an enemy, for example, I must go through with the agreement, even if I have no choice in the matter. I am still bound by the terms of the agreement, which in this case constitute giving money to my enemy, in return for which I am allowed to live.
But even in a commonwealth, after the state of nature has been replaced by a system of law and government, I am still obliged to pay a thief to whom I've promised money in order to save my life. That is, of course, until and unless the law discharges me of such a burden.
What Hobbes is getting at here is the idea that men can legitimately enter into a covenant through fear, such as when the original commonwealth was established. As we saw earlier, men enter into a commonwealth with one another largely out of fear for their lives and their property.
Hobbes is at pains to point out that this in no way invalidates a commonwealth established in the way he envisages. Just because it was founded on fear does not mean that it somehow lacks legitimacy. On the contrary, it is a perfectly valid arrangement that imposes obligations we are duly bound to fulfill.