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SW08/09-CS100413 (2)Page 1 of 1 Keith Marvin - Dirtco / City of Coppell From: "James Cupples" <cupplesj d(�comcast.net> To: "David Dodd" <ddodd(�njdhs.com> Date: 4/13/2010 2:46 PM Subject: Dirtco / City of Coppell CC: "Keith Marvin" <kmarvin(�'.&oppelltx.gov> Attachments: GIA David, Attached is a copy of the indemnity agreement we spoke about. The assignment of contract proceeds is in paragraph III. I'll be sending the letter requested under sepearate cover. Please let me know if you have any quesitons. Jim Cupples Attorney at Law Cupples & Associates, PLLC 1331 Gemini, Suite 201 Houston, Texas 77058 -2729 Phone: (281) 218 -8888 Facsimile (281) 218 -8788 ********************************* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ** CONFIDENTIALITY NOTICE: This electronic mail transmission has been sent by a lawyer. It may contain information that is confidential, privileged, proprietary, or otherwise legally exempt from disclosure. If you are not the intended recipient, you are hereby notified that you are not authorized to read, retain, copy or disseminate this message, any part of it, or any attachments. If you have received this message in error, please delete this message and any attachments from your system without reading the content and notify the sender immediately of transmission. There is no intent on the part of the sender to waive any privilege. ************************************** * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ** file: HC: \Documents and Settings \radloo \Local Settings\Temp\XPgrpwise\4B C4 8 3 B 0 City_... 9/28/2010 , (OON ) American Safety Casualty Insurance Company *B th@ Exchange Atlanta, GA 30339 Aarlarsrur8anrrtrlresoxanex Toll freer Sco.309.36V liens nogs6Agoe Pant 11 miw.smttlp�ust¢Iylntulsnw.cWn GENERAL AGREEMENT OF INDEMNITY THIS General Agreement of Indemnity (hereinafter called Agreement), made and entered into this I6 day of February 2006 by the undersigned as PRINCIPAL and WDEMNITORS, and American Safety Casualty Insurance Company, as SURETY; and, WHEREAS the PRINCIPAL, in the performance of contracts and the fulfillment of obligations generally, whether solely in its own name or as co- venturer with others, may desire, or be required, to give or procure certain BONDS; and, WHEREAS, at the request of the PRINCIPAL and the INDEMNITORS and upon the express understanding that this Agreement should be given, the SURETY has executed or procured to be executed, and may from time to time hereafter execute or procure to be executed, said BONDS on behalf of the PRINCIPAL; and, WHEREAS the INDEMNITORS have a substantial, material or beneficial interest in the obtaining, renewing, continuing or substituting of the BONDS; and, WHEREAS SURETY has relied upon and will continue to rely upon the representations of PRINCIPAL and INDEMNITORS as to their character, identity, control, beneficial ownership, financial condition and existence in executing or procuring BONDS; NOW THEREFORE in consideration of the above stated premises, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by PRINCIPAL and each of the INDEMNITORS, the PRINCIPAL and INDEMNITORS for themselves, their heirs, executors, administrators, successors and assigns, jointly and severally, hereby covenant and agree with the SURETY, its successors and assigns, as follows: DEFINITIONS Wherever they appear in this Agreement, the following terms are defined as set forth in this section: A. BOND means an undertaking, a contract of suretyship, guaranty or indemnity, an agreement, consent or letter to provide such an undertaking or contract, before or after the date of this Agreement, and the continuation, extension, alteration, renewal or substitution of such an undertaking, contract, agreement, consent or letter, whether with the same or different penalties and conditions, executed, provided, or procured by the SURETY. B. CONTRACT means an agreement between PRINCIPAL and a third party, together with all associated documents (including but not limited to general and special conditions, specifications and drawings) for which SURETY executes or procures the execution of s BOND. C. PRINCIPAL means anyone, combination of, or all of the named individuals, ftrmis or corporations set forth below as PRINCIPAL mcluding any of their present or future subsidiary corporations and any corporations or other persons or entities with which they may now or hereafter be controlled or affiliated, or their successors in interest, whether alone or to joint venture with others not named herein, including any such entity for which SURETY executes BONDS. D. INDEMNITOR means any one, combination of, or all of the named individuals, firms or corporations set forth below as INDEMNITOR(S) including any of their present or future subsidiary corporations and any corporations or other persons or entities with which they may now or hereafter be controlled or affiliated, or their successors in interest, whether alone or in joint venture with others not named herein, including any such person or entity who hereafter agrees to become an INDEMNITOR under this Agreement. E. SURETY means AMERICAN SAFETY CASUALTY INSURANCE COMPANY, its reinsurers, and any other person(s) or entity(ies) which the SURETY may procure to act as a SURETY or as a co-surety of any BOND, or any other person or entity who executes a BOND at the request of the SURETY, and the successors, assigns, affiliates, associates and subsidiary companies of any of the foregoing. F. EVENT OF DEFAULT means any one or more of the following: (i) Any declaration of default by an obligee on any BOND, or any actual or alleged abandonment, forfeiture, or breach of, or failure, refusal or inability to perform, any CONTRACT or obligation contained in a BOND, or the filing of any suit or commencement of any action or proceeding by a creditor or obligee of an obligation against PRINCIPAL or any INDEMNITOR, or any suspension, revocation or other material adverse change in the status of any license, permit or other right or permission to bid or perform work of PRINCIPAL with any applicable licensing board or agency; (it) Any actual or alleged failure, delay, refusal or inability of the PRINCIPAL to pay claims, bills or other indebtedness incurred in, or in connection with, the performance of any CONTRACT; (iii) The actual or alleged failure to perform, or comply with any of the terms, covenants, conditions or obligations in this Agreement, or of arty BOND or obligation issued by SURETY pursuant to this Agreement, including the failure to pay or discharge, when due, any indebtedness or other obligation of the PRINCIPAL to the SURETY, imd the failure of PRINCIPAL or any INDEMNITOR to promptly furnish accurate, complete and up- to-date financial statements or other information upon request of SURETY, or the furnishing of a financial statement or other information by PRINCIPAL or any INDEMNITOR which contains any material misstatement or misrepresentation, or which fails to contain information necessary for an accurate presentation of PRINCIPAL'S or any INDEMNITOR'S Financial condition; (iv) an assignment by the PRINCIPAL or any INDEMNITOR for the benefit ofereditors, or the appointment, or an application by the PRINCIPAL or any INDEMNITOR for the appointment, of a receiver or trustee for the PRINCIPAL or any INDEMNITOR or their property, whether insolvent or not, or an application by the PRINCIPAL or any INDEMNITOR for reorganization or arrangement under airy bankruptcy laws of the United States or of any State, possession or territory of the United Sates, or if proceedings for the appointment of a receiver or trustee, for liquidation of, for the reorganization or arrangement of the PRINCIPAL, or any INDEMNITOR Mall be initiated by other persons; (v) If the PRINCIPAL or any INDEMNITOR is an individual, the PRINCIPAL'S or INDEMNITOR'S dying, absconding, disappearing, incompetency, being convicted of a felony or imprisoned, becoming a fugitive from justice, or marrying (without the spouse becoming an INDEMNITOR); or, if the PRINCIPAL or INDEMNITOR is any other type of entity, airy change or threat of change in the character, identity, control, arrangement, management, beneficial ownership or existence of the PRINCIPAL or INDEMNITOR any discontinuation or cessation of operations, being convicted of a felony, being debarred from bidding on any federal, state or local governmental projects, any material adverse change in the financial condition ofthe PRINCIPAL or any INDEMNITOR or any transfer ofassets, by PRINCIPAL or INDEMNITOR, not in the ordinary course ofbusiness to a person or entity not an INDEMNITOR; (vi) Any proceeding or the exercise of any rights by any individual or entity, including PRINCIPAL or any INDEMNITOR, which deprives or impairs PRINCIPAL'S use of its plant, machinery, equipment, plans, drawings, toots, supplies or materials; (vii) no happening of any event other than those specified in (i) through (vi) which, in the SURETY'S sole opinion, may expose SURETY to loss, cost or expense. Initials: Page I of 7 Pages American Safety Casually Insurance Company IR H. INDEMNITY AND KOLA HARMLESS. A. "rhe PRINCIPAL and INI)I?MNI•rORS, jointly and severally, shall exonerate, hold harmless, tndenmify and keep indemnified die SURETY from and against any and all claims, demands, liability, losses, costs, and expenses of whatsoever kind or nature, including court costs, attomeys' fees, adjusting costs and investigative costs, and from and against any and all other such losses and expenses which the SuRr :"I'Y may sustain, suffer or incur: (i) fly reason of having executed or procured the execution of BONUS; (it) By reason of the failure of the PRINCIPAL or INDEMNFTOR.S to perform or comply with any ofthe covenants or conditions of this Agreement, including but not limited to the payment of ull premiums due for BONDS; (iii) in enforcing any of the covctmnts, obligations or conditions of this Agreement; (iv) In making any investigution. obtatinhig or attempting to obtain a release under or exoneration or a BOND or of PRINCIPAL or S(JRE -1'Y, or recovering or attempting to recover loss or expense paid or unpaid bond premium in connection with this Agreement or any BOND; (v) In prosecuting or defending any action or claim in connection with any BONI), whether SURIi rY at its sole option elects to employ its awn counsel, or permits or requires PRINCIPAL acrd INDEMNrFORS to make artangemcnts for the SURETY`S legal representation; (vi) By reason of the occurrence orally Event of DePault by PRINCIPAL or any INDLMNITOR; (vii) As a result of liability incurred or amounts paid in satisfaction orseulcment of any or all claims, demands, damages, costs, losses, suits, proceedings or judgments relating to the PRINCIPAL'S non - performance of an obligation, CONTRACT, or any other matter tinder or covered b a BOND; (viii) As a result of liability incurred or expenses paid in connection with claims, suits or judgments relating to an obligation, COMMACT, or a BOND, including, without limitation, attorney's fees and all legal expenses, including in -house attoney's fees, adjusting fees or investigative fees, and all fees and costs for investigation, accounting, adjusting, engineering or other professional services related to the adjustment of claims and losses deemed necessary or appropriate in the sole discretion of SURF: rY. 11. Payment shall be maihe to the SURETY by tie PRINCIPAL. and INDEMNITORS as soon as liability exists or is asserted against the SURETY, or upon the demand of SURiCTY, whether or not the SURETY shall have made any payment therefore. Such payment shall be either equal to die amount orally reserve set by the SURF IY, or equal to such amount as the SURETY, in its sole judgment, shall dmin sufficient to protect it from loss. The SURETY shall have the right to use the payinent, or any part thereof, in payment or settlement of any liability; loss, cost or expense I'or which PRINCIPAL or the INDaINiTORS would be obligated to indemnify the SUItCTY under the terms of this Agreement, C. In the event of any payment by the SURETY, the PRINCIPAL. and INDEMNITORS further agree that in any accounting between live SURE FY and the PRINCIPAL, or between the SURFTY and the INDF..MNrl "ORS, or either or both of them, the SURETY shall be entitled to reimbursement for any and all disbursements made by it in guod faith in and about the matters contemplated by this Agreement under the belief that it is or %vas liable for the sums and amounts so disbursed, or that it was necessary or expedient to make such disbursements, whether or not such liability, necessity, or expedienoy existed; and, that the vouchers or other evidence of any such payments made by the SURETY shall be prima facie evidence of the fact and anrountof the liability of PRINCIPAL and INDEMNTTORS to lite SURETY. In addition to the payments to he mark to SURETY asset forth above, PRINCIPAL mid INDEr.MNTPORS agree to pay to SURE TY interest on all disbursenents made by SURETY at the maximum rate permitted by law calculated from the date ofeach disbursement. III. ASSIGNMENT. A. The PRINCIPAL, and the INDEMNITORS as their interests may appear in the Hollowing subsections of this paragraph, hereby assign, transfer, pledge and set over to SURETY effective as of the effective date of each BOND executed by SURETY, the rights and property described hereafter, as collateral, to secure any arid all obligations in this Agrcemenl and any other indebtedness or liabilities of the PRINCIPAL or INDEMNITORS to the SURE fY, whether heretofore or hereafter incurred: (i) All the rights of the PRINCIPAL., or INDEMNITORS in, and arisbig in any manner out ofaay CONTRACT; (if) All the right, title and interest ofthe PRINCIPAL or INDEMNiTORS Ill and to all machinery, equipment, plant, tools, inventory and materials which are now, or may hereafter he utilized in connection with any CONTRACT, regardless of whether they are located at a construction site, in storage elsewhere, or in transit anywhere; (iii) All the right, title and interest of the PRINCIPAL or INDEMNiTOR in and to all subcontracts and purchase orders let or to be let in connection with ariy CONTRACT and in and to all suruty bonds supporting such subcontracts m' purchase orders; (iv) All the right, title and interest of the PRINCIPAL, or INDEMNITORS in and to any actions, causes or ruction, claims or demands whatsoever which the PRINCIPAL. or LNDFMNTTORS may have or acquire against any party to any CONTRACT, or actions, causes of action, claims or demands arising out of or in cortriection with may CONTRACT including but not limited to those against obliges ran bands, design prof'tssionals, general cozilmetors, subcontractors, laborers or mnlcrialmen or any person furnishing or agreeing to famish or supply labor, material, supplies, machinery, tools, inventory or other equipmerd in connection with or on account of any CONTRACT and against any surety or sureties of any obligee, general PRINCIPAL, subcontractor, laborer, or materialmen; (v) All monies retained and arty and all monies that may be due or which hereafter become due on account of any CONTRACT. bonded or unbondcd, or nn any promissory note or account receivable; (vi) Any and all right, title, interest in, or use orally parent, copyright or trade secret which is or may be necessary for the completion of any bonded work; (vii) All monies due or to become due to PRINCIPAL or INDf MNTfORS on any policy of insurance relating to any claims arising out of the performance of any CONTRACT, including, but not limited lo, claims tinder builders risk, liability, fire, employee dishonesty or workers compensation hmaunnlCC policies, including premium refunds; and (viii) Any and all rtndisbursed loan Ands, deposits or interest reserve accounts to which PRINCIPAL, or 1NDBMNIT'ORS may be entitled, and any and all collateral tar and undertakings given by the PRINCIPAL, or 1NDEMNiTORS in connection with any CONTRACT or obligation. B. SURETY shall have the full and exclusive right (but not tie obligation), in its name or in the name of ire PRINCIPAL. or INDLMNITORS, to prosecute, compromise, release or otherwise resolve anv orthe claims, causes ofaction or other rights assigned to SURETY, upon such terms cis SURI:I'Y, in its sole discretion shall decor appropriate. C. "Ilse PRINCIPAL mud iNDENINFFORS hereby irrevocably nominate, constitute, appoint and designate Ilse SUR[:`rY, or its designee(s), through its or their authorized repmscntative(s} as their attorney -in -fact with the right, but not the obligation, to exercise all oftlic rights ortlhe PRINCIPAL, and iNDEMNTI'ORS assigned, transferred and set over to SURETY in this Agreement, and in the name of the PRINCIPAL uml INDEMNiTO2S to make, execute, and deliver any and all additional or other assignments, documents, papers, checks, drafts, warrants or other instruments made or issued in payment crony obligation to which SURETY has the right to receipt of payment pursuant to this Agreement deemed necessary and proper by the SURETY in order to give full effect not only to the intent rand meaning of the assignments made in this Agreement, but also to the full protection intended to be herein given to the SURETY under all other provisions of this Agreement. Tate PRINCIPAL. and INDFMNiTORS hereby rattly mil confirm all acts and actions taken and done by SURETY or its designev(s) as such atoniey -in -Fact. IV. RESERVE DEPOSIT. A. if for any reason SURETY shall deem it necessary to establish or to increase a reserve to cover any possible liability or loss f"or which the PRINCIPAL or INDEMNITORS will tk obligated to indenmify SURETY under the ternnc of this Agreement, or to establish a collateral deposit in cmnection with dia issuance or procuremem of any BOND for PRINCIPAL, the PRINCIPAL or INDFMNUORS will deposit with SURETY, immediately upon demand, a sum of money egtutl to such reserve and any increase thereof as collateral security to SURETY for such liability or loss. SURFTY shall have the right to use the deposit, or any part thereof, in payment or settlement of any liability, loss, expense or otlmer matter for which the PRINCIPAL or INDFMNiTORS would be obligated to indemnity SURETY under the terms of'this Agrecnlent. SURETY shall have no obligation to invest, or to provide a return or interest on tie deposit. SURETY'S rkmand shall be sufficient if sent by registered or certified mail to the PRINCIPAL or iNDEMNITORS at lite addresses suited herein or at the addresses of the PRINCIPAL or INDHMNITORS lust knowri to SURETY, regardless ofwhether such demand is actually received by tie PRINCIPAL or INDF..MNITORS. i Cr Page 2 of 7 Pages American .Sq/ety Casualty lnstirance Company t 102N 13. SURE iY may seek a mandatory injunction to compel the deposit of such collateral together with any other natnedy at law or inequity that SURELY may lave. SUABLY shall have the right to retain such collateral until SURETY has received satisfactory evidence of SURETY'S complete discharge and exoneration from any claim or potential claim tinder all BONDS and until SURE fY has been fidly reimbursed for any and all liability incurred from claims, demands, damages, costs, loss, expense, attarney/s fees, or outer items forwhich PRINCIPAL and INDEMNITORS are liable hereunder. REMEDIES UPON DEFAULT_ A. In the event of airy EVENT OF DFFAULT as described in this Agreement, SURE IY shall have the right, at its option, and in its sole and algoluic discretion, and is hereby so autarized by PRINCIPAL, and INDEMNfi'ORS to take any one or more of the following actions. (i) To consent to any change in or alteration in any CON`fRACh' or in any and all plans and specifications relating thereto; (ii) To take over arty CONTRACT and arrange for its completion; (iii) To take possession of PRINCIPALS equipment, materials and supplies at the site of the work or elsewhere, and PRINCIPAL'S office equipment, books and records as are necessary and utilize the same fin completion of any CONTRACT; (iv) To advance or loan such finds or guarantee a loan for funds either prior to or after default, as SURELY shall deem necessary for the completion of any CONTRACT and far the discharge of SURELY in connection with any CONTRACT. The repayment of such advance or loan shall be the responsibility of the PRINCIPAL and iNDEMNITORS; (v) To file an immediate suit to enforce the provisions of this Agreement; (vi) To take possession of the work perfonmed and to be performed pursuant to all or any part of any CONTRACT, and at the expense of PRINCIPAL and INDEMNITORS, to complete the performance required by the obligation or CONTRACT or to cause the same to be completed by others or to consent to the completion thereof, shot to take any otter action which SURETY may deem appropriate in connection therewith; (vii) in its tame or in the frame of the PRINCIPAL. or INDEMNITORS to adjust, settle or compromise any claim, counterclaim. demand, suit or judgment involving any BONI) or to take whatever other action it may deem necessary, expedient or appropriate with respect to such matter. SURETY'S determination as to whether any such claim, counterclaim, demand, suit or fudguieut should be settled or defended shall be binding and conclusive upon the PRINCIPAL turd I ND1WTORS. 13. Any such action may be taken by SURELY with or without SLIRFTY exercising any other right or option conferred upon SURETY by law, equity or the hails of this Agreement, and without waiving any other right or option so conferred upon SURETY. C. At its solo option, SURETY may reduce die amount of PRINCIPAL'S and INDEMNITORS' liability to SURETY hereunder by applying to such liability any money payable to PRINCIPAL and/or INDEMNITTORS by SURETY. The money payable to PRINCIPAL or IN EMNITORS may be, but is not limited to, any money payable by SURF fY, in the evert SURETY, by separate contract is an insurer of PRINCIPAL or INDEMNITORS or is an insurer of any other individual or legal entity, or any money payable to PRINCIPAL, or INDEMNITORS as a return of unearned or other premiums, or money payable to settle it claim of PRINCIPAL, or iNDEMNHORS against SURETY or any individual or other legal entity insured or bonded by SURETY. Nothing contained herein shall operate: to enlarge any obligations of SURETY to PRINCIPAL. or INDFMNITORS beyond those contained in this Agreement or tin any such other contract of insurance, D. PRINCIPAL and iNDEMNITORS agree that all amounts due SURETY hereunder, and all liabilities of PRINCIPAL and INDEMNITORS to SURE- [Y arc separate and indepealdert from any actual or alleged liability of SURI Y to PRINCIPAL mid INDEMNITORS, mid that on set- oR'ofany such amounts or claims shall be permitted to in; exercised by PRiNC:IPAL, and INDEMNITORS against SURETY nor used as a det'ense against any claim of SURETY. Tlhe PRINCIPAL and INDEMNITORS waive and subordinate all rights of indemnity, subrogation and contribution each against the other until all obligations to the SURETY under this Agreement, at law or in equity, have been satisfied in full. vi. PREMIUMS. 'toile PRINCIPAL_ and INDFMN17FORS will pay to the SURETY all premiums and charges of the SURETY for the 13ONDS (including but not limited to initial, renevsi, additional, and contract overrun premiums according to the SURM*Y'S current rate manual) immediately upon issuance of each BOND, or as such premiums may arise. Any billing practice, delay in payment or other payment variance procedure shall not constitute a waiver of SURETY'S rights to obtain fill payment upon to issuance of any BOND, or as such premiums may arise. The initial premium is fully earned upon execution of time BONI). VII. TRUST FUND, A. The PRINCIPAL.. and INDFMNI TORS covenant and agree that all payments received far or on account of any CONTRACT shall be held intrust as trust fund for the payment of obligations incurred or to be incurred in the pertomance ofany C:ON'fRACT and used for labor, materials, and services furnished in the prosecution of the: work in any CONTRACT or any extension or modification thereof. It is expressly understood and declared that all monies due and to become due under any CONTRACT art: also trust t'uhds, whether in the possession of the PRINCIPAL or INDEMNITORS or otherwise. The trust funds shall be for the benefit and payment of all obligations for which the SURETY may be liable under rutty BONDS. )S. The trust(s) shall inure to the benefit of the SURETY for any liability or loss it may have or sustain wider any BOND, and lbr any and all obl igalioas of PRiNCIAAI, and INDEMNITORS tinder this Agreement, and this Agreement mid declaration constitute notice ofsuch trust B. if SURETY discharges any such obligation, it shall be entitled to assert the claim of such person to The tnzt funds, and PRINCIPAL and INDEMNITORS shall. upon demand of SURETY and in implementation of the trust or tracts hereby created, open an account or accounts with a bark, selected by SURVIY which shall be designated as a trust account or accounts for rte deposit of such oust finds, mid shall thereupon deposit therein all monies received pursuant to said CONTRACT' or CONTRACTS. Withdrawals from such accounts shall be by check or similar instrument signed by the PRINCIPAL artd countersigned by a representative of SURI:1'Y Said trust(s) shall termitutte on the payment by PRINCIPAL. of all the obligations for the payment of which the [rust(s) are hereby created or upon the expiration of twenty years from the date hereof, whichever shall first occur. viii. PERFECTION OF SECURITY INTEREST'. This Agreement slmll constitute a Security Agreement for dmc benefit of the SURETY and also a Financing Statement, both in necordance with the provisions of the Uniform Commercial Code or any similar statute, ordinance or regulation of any jurisdiction or agency, and may be so used by the SURETY without in any way abrogating, restricting or limiting the rights of the SURETY under this Agreement or under law or in equity. SURETY may add such schedules to this Agreement describing specific items of security covered hereunder as shalt he necessary or appropriate. The SURETY may, at its option, file or record this Agreement or any uther document executed by arty or all of the PRINCIPAL or INDEMNITORS in connection with the application, issuance or execution of airy BOND(S), or renewal thereof, coming within the seopc of this instrument as a security agrcoment or as part of a financing statement or, as notice of its prior interest trod assignment under the provisions of the Uni fonn Commercial Code or any other statute, otdimmce or regulation of any jurisdiction or agency. The Failure to so file shall not release or discharge any of the obligations of the PRINCIPAL. or 1NDL"MNITORS under this Agreement. tx. CHANGES. 'the SURFTY, at its sodc option, is authorized and empowered, without notice to or knowledge of PRINCIPAL or tle INDEMNITORS, to agree or refuse to agree to any clamge whatsoever in any BOND, or any CONTRACT, including, but not limited to, any change in the time for the completion of airy CONTRACT and to pnynienu or adv;ntccs thereunder before the same may ire dude, and to assent to or lake any assignment or mmigmments, to execute or consent to the execution of any continuations, extensions, renewals, cotargernents, modifications, changes or alterations of arry BOND and to execute any substitute or substitutes therefore, with the sane or dift4ent conditions, provisions acid obliges and with the same or larger or snmdlcr penalties. It is expressly understood and agreed that The PRINCIPAL. and INDEMNITORS ,.hail remain bound under the terms of this Agreement even though any such assent by the SURETY does or might substantially mcreasc the liability of said PRINCIPAL or INDEMNITORS. C. ADVANCES TO PRINCIPAL. '[ire SURELY, at its sole option, is authorized and empowered to guarmtlec loans, to advance or lerul to, or for the account of, the PRINCIPAL, any money, which the SURELY in its sole discretion may sce fit to do. reserving to itself, however, the absolute right to cancel any such guarantee and to cease Initials: r Page 3 of 7 Pages American Safety Casualty Insurance Company advancing or lending money to the PRINCIPAL, or lbr the account of the PRINCIPAL with or without cause and with or without notice to PRINCIPAL or iNDEMNITORS. SURETY shall not be held responsible for application of the proceeds of such loan or advance. All money expended by the SURETY, or lent or advanced from time -to -time to, or for the account of, the PRINCIPAL or guaranteed by the SURETY, and all related cost and expense dnatured by the SURETY, shall be loss to the SURIi IY for which the PRINCIPAL, and lire INDEMNITORS shall be responsible, notwithstanding that said money or airy pan thereofshould nut be so used by the PRINCIPAL. xi. BOOKS AND RECORDS. At any time, and until such time as the liability of lite SIJRI L'Y under all BONDS is terminated or SURETY is filly reimbursed all amounts due to it under this Agreement, the SURD N shall have de right of access to the books, records, accounts rid documents of the PRINCIPAL. and INDEMNITORS, when ver located, for the purpose of inspection, cvopying or reproduction. Any financial institution, depository, materialnum, supply house, obligee, general PRINCIPAL, subcontractor, or other person, firm, or corporation, when requested by the SUREW, is hereby authorized by PRINCIPAL and INDIs"ITORS to furnish the SURETY any information regtiestcd by SURETY, including, but not limited to, the status of the work under any CONTRACT being performed by the PRINCIPAL, the status, extent or audition of de performance of any CONTRACT being performed by the PRINCIPAL, the status, extent or condition of the performance of any other CONTRACT and payment of accounts. Upon the occurrence of any Event of Default, PRINCIPAL and INDEMNITORS, upon SIJRE:TY'S request, shall immediately turn over to SURETY, or its designee, at a place and in a manner designated by SURM, such books, records, accounts, documents and CONTRACTS in whatever form, as requested by SUREry. The expense ofmay inspection permitted hereunder, and of providing die records so specified, shall be borne by PRINCIPAL, and INDEMNITORS. SURF I'Y may fumush may infomation, which it now bas or may hereafter acquire concerning the PRINCIPAL. and iNDEMNII'ORS, to other persons, fines or entities for the purpose of procuring co- suretyship or reinsurance or of advising such persons, firms, or entities as it may deem appropriate. xll. DECLINE OF EXECUTION. PRINCIPAL and fNDEMNrI'ORS are not obligated to request the SURETY to execute, provide or procure any BOND required of them in the performance and lidfillment of obligations; however, PRINCIPAL shall not, during the term of this Agreement and while airy Bond is outstanding or remains in effect, without the express written consent of Surety, engage any other person or entity to provide bonds for PRINCIPAL., Furthermore, the SURETY has the right in its sole mud absolute discretion, to decline to execute, provide or procure any BOND requested by PRINCIPAL. If SURETY does execute, provide or procure the execution ore bid hand or proposal bond, or agrees or consents to provide such contract of suretyship. SURL:TY retains the right in its sole and absolute discretion to decline to execute lire final bond (including, but not limited to, performance, payment or maintenance bond(s) that may be required in connection with[ any :Huard that may be made under the bid proposal or lender to which the bid proposal bond or agreement or consent to provide such contract cif suretyship is given, without relieving PRINCIPAL or INDEMNITORS from their liability under this Agreement in connection with the provision ofthe bid bond or proposal bond. SURETY shall not be liable to PRINCIPAL or INDEMNITORS for tiny such action, and is released from any acid all liability, cost or expense arising out of, relating to or resulting from any such action. XI 11. WA IV ERS BY PRINCIPAL, AND iNDENINITORS. The PRINCIPAL arrd INDEMNITORS hereby tvaive and agree not to assert any of the following, to the end mid effect that PRINCIPAL and iNDEMNITORS shall he and comimte to be liable hereunder. (i) Airy defense that this Agreement was executed subsequent to the date of any BOND, it being expressly understood and agreed that the PRINCIPAL., and INDLMNrfORS hereby admit and covenant (hat the BOND was executed by SURI: rY pursuant to the request of the PRINCIPAL and INDFMNITORS and in reliance on the promise by (he PRINCIPAL and INDEMNITORS to execute acrd perform this Agreement; (it) Any right to claim that any of their property, including homesteads, is exempt from levy, execution, sale or other legal process under the laws of any state, territory or possession in tiny action brought by SURETY under this Agreement; (iii) Any right to require SURUIT to proceed against PRINCIPAL.. or INDEMNITORS or any other person, firm or entity or to proceed against or exhaust any security or remedy held by SIJR17TY at any time or to pursue any other remedy in SURF I power, (iv) The defense: of the statute of limitations in any action hereunder for the collection of any claim or amount due under this Agreement, or the performance of any obligation indermmified hereby; (v) Any defense based upon an election of remedies by SUREMY, which clection may destroy or otherwise impair subrogation rights of PRINCIPAL or any 1NDEMNITOR or the right of INDEMNiTOR to proceed against the PRINCIPAL or to realize upon any security, (vi) Any right to notice of the execution of any FOND and of the acceptance of this Agreenrcal; (vii) Any right to notice ofany default, payment or any other act or acts giving rise it) any claim under any BOND, as troll as notice of arty and all linbil ity of the SURETY under tiny IIOND, and any and till liability on ilia Bart ofPRINCIPAL and INDEMNITORS hereunder. XIV. SUITS. A. Separate suits may be brought by SI1RL 1'Y against any or all of the PRINCIPAL or INDEMNITORS W enlbrce the tcrins of this Agreement as causes of action accrue. and the bringing of suit or the recovery of judgment upon ary cause of action shall nut prejudice or bar the bringing of other suits upon other causes of action, whether previously or subsequently arising. R. The PRINCIPAL and each INDEMNITOR is the agent for the PRINCIPAL. and all 1NDEMNITORS for the purpose of accepting service of toy process in ilia jurisdiction in which the PRINCIPAL. or INDEMNITORS accepting the process resides, is domiciled, is doing business or is found. Xv. OTHER SURETIES. if the SURETY procures the execution of any BOND by other stn tics, or executes Ilia BONDS with co- sureties or reinsures any portion or said BONDS with reinsuring sureties, then all the terms and conditions of this Agreement shall inure to the benefit of sash other sureties, co- surcties and reinsuring sureties, as their Interests may appear. XVI. TERMINATION. A. 'phis Agreement is it continuing obligation of the PRINCIPAL and 1NDEMNITOR.S, and their successors, legal representatives, estates, lieirs mid assigns, unless terminated by written notice to SURE'L'Y as hercinaller provided, and such termination by a particular person or entity shall in no way affect the obligation ofmty other person or entity who has not given such notice. If PRINCIPAL or INDEMNITORS have previously executed an Agreement in favor of SURETY, the accg)utnce by SURGI'Y ofthis Agreement shall not relieve PRINCIPAL or INDF..MNITORS (rani liability to SURI:1'Y under such prior Agreement. R. This Agreement may be temrinated by PRINCIPAL., or any INDEMNITOR upon written notice to SURF Y by PRINCIPAL or iNDEMNITORS, or by PRINCIPAL'S or INDEMNITOR'S legal representatives or successors, by Registered or Certified Mail addressed to SURETY at its Home office shown in this Agreement, as such may be changed Iron time- to-timo. Termination of this Agreement as to such person providing notice shall not be ellirotive until thirty (30) days alter receipt of said written notice by SURDfY. It is understood and agreed that oral notice to or constructive notice to any agent or employee of S11RIs 1'Y shall not constitute effective notice of termination under this Agreement. Page 4 of 7 Pages Americun Safety Casualty hrsurance Conrparey C. Termination of this Agreement shall not relieve the PRINCIPAL. or INDFMNITORS from liability to SURETY arising out of any BOND executed, authorized, provided or procured by SURETY on behalf of PRINCIPAL prior to the effective date of such termination and for which this Agreement is purl of the consideration on which SURETY relied in executing, authorizing, providing or procuring such BONDS, including any renewals, substitutions and extensions thereof, and any BONDS executed pursuant to a bid or proposal bond executed or authorized prior to such effective date of termination. and any renewals, substitutions and extensions thereof, and any maintenance or guarantee bonds executed incidental to any other BOND, and any renewals, substitutions and extensions thereof. D. The liability of the INDEMNITORS hereunder as to existing or future BONDS of PRINCIPAL shall not terminate by mason of the failure of SURETY to disclose fats known about PRINCIPAL., even though such facts materially increase the risk beyond that which die iNDF,MNITORS might intend to assume. Whether SURENY may have reason to believe such facts are unknown to the INDEMN[TORS, or whether SURETY may have reasonable opportunity to communicate such facts to the INDEMNITORS, the INDENINITORS hereby waive notice of such facts, and of any obligation of SURETY to notify INDEMN IIX)RS of same. XVII. NOTIFICATION. A. The INDEMMTORS agree among themselves and hereby acknowledge to SURETY shut notification by SURETY to arty one iNDEMNITOR shall constitute notice to all INDENWITORS. Any notice permitted to PRINCIPAL or iNDEMNITOR may be sent by SURELY to their respective addresses shown in this Agreement, but failure of PRINCIPAL or iNDEMNITOR to receive such notice sluull not operate as a waiver of SURETY'S rights or a but to etrforcement of SURETY'S rights. PRINCIPAL. and INDI MNIT'ORS shall notify SURETY promptly of any change of address. Written notice roust be given by PRINCIPAL or INDEMNITORS to SURE`fY at its home *Me(!. as shown in this Agreement and as sane may be changed from tithe -to -time, or at such outer address as SURE) Y may provide to PRINCIPAL or INDEMNITORS from time - to -lime, at the earliest practical al time of any anticipated change or negotiations entered into by PRINCIPAL or INDEMNITORS for any anticipated change in the chnracter, identity, control arrangement, management, beneficial ownership (including, if a corporation, ownership of more than 5% of the stock of PRINCIPAL or iNDEMNITOR} or existence ofthe PRINCIPAL or iNDEMNITORS. ft. The PRINCIPAL and iNDFivlNFrORS shall promptly provide written notice to the SURETY at its home office as shown in lids Agreement, as such address may be clanged Truth lime -to -time, of any of the following events: (i) Notice by any obligee on any BOND to the PRINCIPAL, that the PRINCIPAL is in default or has failed or refused to perfomt any CONTRACT obligation; or that PRINCIPAL, has failed to pay any obligation; and (tai) Notice by uny obligee on any BOND to the PRINCIPAL that the PRINCIPAL. cure its performance or show cause as to why the PRINCIPAL should not be terminated for defauht XVIII. INSPECTIONS. The SURETY, by and through its autlmori2ed representatives, shall have the right, but not the obligation to inspect the PRINCIPAL'S property, documents and operations, including projects on which the PRINCIPAL. is performing work, whether bonded or not, at any time and from time-to-time- The PRINCIPAL. shall fissure access by the SURETY'S representative to all areus of the PRINCIPAL'S property and operations. Neither the SURETY'S right to make inspections nor the making thereof; nor the making of any report as a result thereof, shall constitute an undertaking, by the SURETY or its representatives, of or for the benefit of the PRINCIPAL or INDEMNITORS or any other person, firm, organization or entity to determine, warranty or guarantee that such property or optxations are safe, appropriate or arc in compliance with any law, rule, regulation, or the CONTRACT; the PRINCIPAL laid INDENINITORS shall defend, indemnify and hold harmless the SURETY froth any and all claims, liability or loss arising out ofthe periomance ofsuch inspections. XIX. GENERAL PROVISIONS. (i) If any provision or provisions, or portion thereof, of this Agreement shall be void or unenforceable under the laws of any jurisdiction governing its construction, this Agreement shall not be void or vitiated thereby, but shall be construed and enforced with the same effect as though such provision or provisions, or portion thereof, were omitted. (ii) in case any of the parties mentioncd in this Agreement fail to execute the same, or in case the execution hereof by uny of the parties slmall be defectiv c or invalid for any mason, such lxilure, defect or invalidity shall not in any nwnner affect the validity of this Agreement or the I iability hereunder of any of the parties executing the same, but each and every party executing smite shall be and remain fully bound and liable hereunder to the some extent as if such failure, defect or invalidity had not existed. (iii) All rights and remedies of SURETY under this Agreement or however otherwise derived shall be cumulative, and the exercise of or tadum to exercise any right or remedy at any time shall not be an election of remedy or a waiver of any other right or remedy. Failure of SURE: fY to pursue arty remedy aguinsl arty one or more of the PRINCIPAL or INDEMNiTORS shall not release or waive any right against any other of the PRINCIPAL or INDIxaLNiTORS. Rite SURELY is not requireed to exhaust its remedies or rights against PRINCIPAL., or to await receipt of wry dividends from due legal representatives of PRINCIPAL before asserting its rights under this agreement against the INDEMNITORS. The rights, pawers and remedies given to SURMY by this Agreement shall be and are in addition to, and not. in lieu of, any and all rights, powers and remedies which SURETY may have or acquire against the PRINCIPAL or INDEMNITORS or others whether by the terms of any other agreement, by operation of haw or othertviae. (iv)The PRINCIPAL or INDEMNI'IX)RS shall continue to remain bound mndat this Agreement even though SURETY may, fmm time -to -time tail with or without notice to or lumowbedge of the PRINCIPAL. or iNDEMNIT'ORS, have heretofore accepted or released, or shall hereafter accept or release, other Agreements of Indemnity or release, exchange or return collateral of the PRINCIPAL or INDEMNITORS or others. Failure of PRINCIPAL. to sign any BONDS shall not relieve the PRINCIPAL or INDEMNITORS of liability under this Agreement. (v)'rhe PRINCIPAL, armd INDENINfrORS will, on request ofSURETY, procure the discharge of SURE=TY fronm any BOND, and all liability by reason thereof. (vi) SURETY shall have every right, defense, or remedy which a personal surety without compensation would have, including the right of cxoncrafion. Time SURETY stall have the right to fill in any blanks left herein and to correct any errors in filling in any blanks herein. (vii) This Agreement may not he changed or modified orally. No change or modification shall be effective unless specifically agreed to in writing, and signed by an officer of ft SURIiTY_ (viii) Wherever tensed in this Agreement the plural shall include the singular, [lie singular shall include the plural, and the neuter shall include bulb genders as the circumstances require. (ix) This Agreemmnt is to be liberally construed so as to protect, exonerate and indemnify SURETY. (x) The paragraph titles as contained in this Agreement are descriptive only and do not restrict or modify the terms of the Agreement. in the event of any inconsistency between Cite paragraph titles and the terms of this Agreement, the terms of this Agreement shall control (xi)'Ihns Agreement shunt be interpreted in accordanc=e with the laws of the State of Delawware. XX. ME=RGER AND CONSOLIDATION. 1I11: PRINCIPAL. AND INDEMNITORS HAVE READ AND UNDERSTAND TI- ➢S AGREEMENT, AND HAVE CONSULTED W1111 SUCH LEGAL AND OTHER PROFESSIONAI, ADVISORS AS 111EY DEEM NIECESSAItY PRIOR TO EXECUTING THIS AGREEMENT. EXCEPT i-Olt ANY PREVIOUS INDEMNITY AGREEMENT OR AGREEMENTS EXECUTED BY PRINCIPAL OR INDEMNITORS, - 1 AGREEMENT OF iNDEMNITY CONSTITUTES THE ENTIRE AGREEMENT BETNVr -EN THE, PARTIES. NO O'T'HER SEPARATE AGREEMENTS Olt L.INDERSTANDINGS, PAST, PRESENT OR fUTUR)?, WI- IFTHER ORAL. Olt WRITTEN, CHANGE THE TERMS OF THIS AGREEMENT. XXI. EXCEPTIONS AND WAIVER. NONE. iN WITNESS WI) EREOF, the PRINCIPAL and iNDEMNITORS, intending to be legally bound hereby, have signed and sealed thie Agreement the day and year first above written * ** SIGNATURE PAGES FOLLOW * ** Initials: Page 5 of 7 Pages Amer ican Safety Casualty Ineurarrce Company F AR PRINCIPAL ATTEST or Y Party Witne PRINCIPAL NAME: Our Dirtco, L.P. dba Dirteo A Limited Partnership or Dirtco, L.P. By: Address: 5755 Hen House Road City: Keller State: TX Zip: 76244 Typo a rte f �� Home Address: Home Phone #: �/i� ��� /��� 7SO7Z �(O By: �_�7��aLia Type Name. G M. Styes Mem r, G. Styles, LLC General Partner (AFFIX CORPORATE SEAL] ACKNOWLEDGEMENT OF PRINCIPAL V STATE OR COUNTY OF On this / da of J t �e zo°7 before me, personally appeared Gary M. Styles a member of the firm of G. Styles, LLC General Partner of Our Dlrtoo. L.P. personally known to me or proved to me on the basis of satisfactory evidence to be the person who is described In and who executed the foregoing instrument, and acknowledged to me that (s)he executed the same as and for the act and deed of the said firm. Sworn to and subscribed before me this day or p(1 Notary Public [SEAL] My Commission Expires: �'.,�,� • �d /'q MINDY GAL] p,WAY My COMML [on Expires ADDITIONAL PRINCIPAL ATTEST or T Party Witness: PRINCIPAL NAME: O. Styles, LLC Address: 5755 Hen House Road By: City Keller State: TX Zip: 76244 � r : J TypeM I f Tin IT21 IAdlir& 4ely 11 Home Address: Home Phone #: yG�s�98��8 7Sa3't i �/ Hy: , Type Nam . ry A. Styl ember (AFFIX CORPORATE SEAL) ACKNOWLEDGEMENT OF ADDITIONAL PRINCIPAL f. ."3.� _........ STATE OF �'Z rs COUNTY OFr -. On this day of Aq hhz" ' r ZQOZ before me, personally appeared Gary M. Styles a member of the firm of G. Styles. LLC personally known tome or proved to me on the 'basis of satisfactory ovidenee to be the person who Is described in and who executed the foregoing Instrument, and acknowledged to me that (s)he executed the same as and for the act and deed of the said firm. Sworn to and subscribed before me this / day of Ol v" .� Notary Public �rta— [SEAL] My Commission Expires: MINDY GALLAWAY My Comml aloe ExFlres Page d of 7 Pages American Safety Casualty Insurance Company ADDITIONAL PRINCIPAL ATTEST er 3' P itne, s: PRINCIPAL NAME: Our Dirtco, L.P. dba Dirtco A Limited Partnership or Dirtco. L.P. dba Styles Contracting By: Type N I Address: 5755 Hen House Road City Keller State: TX Zip: 76244 / ��y � /�Y %� !.r �Co Homo Address; Homo Phoned: - ` �jo32 By: Type Name: M S6ytes Mw 4r, G. Stylcs, LLC Genera[ Partner (AFFIX CORPORATE SEAL) ACKNOWLEDGEMENT OF ADDITIONAL PRINCIPAL STATE OF COUNTY OF µ On this 1 99 day of (fir ��� w X07 before me, personally appeared Gary M. Styles a member of the firm of G. Styles, LLC General Partner of Our Once. L.P.. personally known to me or proved to me on the basis of satisfactory evidence to be the person who is described in and who executed the foregoing Instrument, and acknowledged to me that (s)he executed the same as and for the act and deed of the said firm. y, Sworn to and subscribed before me this LO day of G %y ! Notary Public Is My Commission Expires; 0 2..3" cold /d MINDY GALLAWAY TS My Commissfon Ex0es Ill.# 01 a INDIVIDUAL INDEMNITOR S signature t ax Signature ZL Name: Gary SS # Name: ebb es SS -5 Home Address: 270 CR 4773 Boyd, TX 76023, Home Address: 270 CR 4773 Boyd, TX 78023, Residence Phone #: 940433 -8429 Residence Phone A 940433 -8429 One 7 "Individual" per Notary Acknowledgment INDIVIDUAL ACKNOWLEDGEMENTS STATE OF COUNTY OF .. SL On this /f/ day of d� . 2007 before me personally appeared Gary M. Styles personally known to me or proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to in this instrument and acknowledged to me that (s)he executed the same. Sworn to and subscribed before ma thi !'0 .11 �q[ , — Notary Public [SEAL] MINDY GALLAWAY My Commission Expires: ,� • ��J1d STATE OF i + COUNTY OF _... ».. »... On this day of i 2007• before me personally appeared Debbie SWIas personally known to me or proved to me on the basis of satisfactory evidence to be the person whose rhfma is subscribed to in this instrument, and acknowledged to me that (s)he executed the same. Sworn to and subscribed before me this � day of Notary Public [SEAL] My Commission Expires: a �d�0 My commlaftlon kels ,Uoud 23.2 Initials: "ate Page 7 of 7 Pages American Safely Casualty insurance Company