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letter of indemnity

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Financial Dictionary

Letter of Indemnity

1. A letter guaranteeing that contractual provisions will be met, otherwise financial reparations will be made.

2. A letter requesting replacements for lost shares from a company's treasury.

Investopedia Commentary

1. The principal behind a letter of indemnity is the guarantee that losses will not be suffered, should certain provisions of a contract not be met.

See also: Letter of Credit, Treasury Stock

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