From your post I can say with confidence that you are in a situation similar to ours and hundreds of others writing on the forum. Problems like yours have been discussed extensively here.
I suggest you do a search using ‘LFO’ or ‘BG’ or ‘Bank Guarantee’ and reading all the threads that come up to get all the answers you need.
However, the most important thing is: do you have a lawyer? And if yes, do you trust him/her?