SECTION 12.300. Definitions

The following words and terms, when used in this subchapter, shall have the following meanings unless the context clearly indicates otherwise.

(1) Collateral bond--An indemnity agreement in a sum certain deposited with the Commission and executed by the permittee and supported by one or more of the following:

(A) the deposit of cash in one or more accounts, payable only to the Commission upon demand after the Commission has determined the need for forfeiture and has notified the permittee of forfeiture action;

(B) negotiable bonds of the United States, a state or municipality, endorsed to the order of, and in the possession of, the Commission;

(C) negotiable certificates of deposit, made payable only to the Commission in its possession;

(D) an irrevocable letter of credit of any bank authorized to transact business in the United States, payable upon demand;

(E) a perfected, first-lien security interest in real or personal property, in favor of the Commission; or

(F) investment-grade related securities, having a rating of AAA, AA, A or equivalent rating, issued by a nationally recognized securities rating service, endorsed to the order of, and in the possession of, the Commission.

(2) Self-bond--An indemnity agreement in a sum certain payable to the Commission, executed by the permittee and in an amount determined sufficient to assure performance of reclamation responsibilities pursuant to the permit requirements.

(3) Surety bond--An indemnity agreement in a sum certain payable to the Commission executed by the permittee as principal which is supported by the performance guarantee of a corporation licensed to do business as a surety in Texas.

Source Note: The provisions of this §12.300 adopted to be effective April 7, 1997, 22 TexReg 3093.