Form 13b-1 is designed to outline the rights and responsibilities between the Principle (the contractor), the Obligee (The State of California Contractors License Board) and the surety with regards to the provisions of the bond as outlined in Business and Professions Code 7071.5-7071.11. The $25,000 license bond is for the benefit of the employees or the customers should they suffer financial damages as a result of the contractors actions. In addition, form 13b-1 should not be confused with a contractors bond indemnity agreement, which is an agreement between the contractor and the surety with respect to rights and responsibilities as part of the bond contract, with provisions provided should a claim occur.