Surety Bond Guarantee (Indemnity) Agreement

Surety: [Surety Company Name] · Principal: [Name/Company] · Indemnitor(s): [Name(s), if individuals separate from the Principal are also guaranteeing] · Date: [Date]

1. Purpose

In consideration of Surety issuing one or more surety bonds on behalf of Principal, Principal and Indemnitor(s) agree to indemnify Surety as described below.

2. Indemnification

Principal and Indemnitor(s), jointly and severally, agree to indemnify and reimburse Surety for any and all payments Surety makes under any bond issued for Principal, including claims, losses, costs, and attorneys' fees, whether or not the claim is ultimately proven valid.

3. Collateral (if required)

[State any collateral required to secure this indemnity, such as a cash deposit or letter of credit.]

4. Surety's Sole Discretion in Settling Claims

Surety may settle or compromise any claim against a bond in its sole discretion, and its determination of the amount owed is binding on Principal and Indemnitor(s) absent fraud or bad faith.

5. Continuing Agreement

This Agreement applies to all bonds Surety issues for Principal, whether now or in the future, until terminated in writing.

6. Financial Statements

Principal will provide Surety with financial statements upon request, to support Surety's ongoing underwriting of Principal's bonds.

Principal: ______________________ Date: ____________ Indemnitor(s): ______________________ Date: ____________

*This document is provided for informational and educational purposes only and does not constitute legal advice. Section 4 is the term contractors are most often surprised by — it generally means the surety can settle a bond claim and then come after the contractor/indemnitors for reimbursement, even if the contractor disputes that the claim was valid, unless they can prove the surety acted in bad faith.*