Current through Supplement No. 394, October, 2024
1. Trust agreement
and certification of acknowledgment.
a. A
trust agreement for a trust fund as specified in subsection 1 of section
33.1-24-02-36 must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
TRUST AGREEMENT, the "AGREEMENT" entered into as of [date] by
and between [name of the owner or operator] a [name of state] [insert
"corporation" "partnership," "association" or "proprietorship"], the "GRANTOR,"
and [name of corporate trustee],
[insert "incorporated in the state of ____________ " or "a
national bank"], the
"TRUSTEE".
Whereas, the North Dakota department of environmental quality
"DEPARTMENT" a regulatory agency of the state of North Dakota, has established
certain regulations applicable to the GRANTOR requiring that an owner or
operator of a facility regulated under sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819 or subsection 5
of section
33.1-24-06-16, or satisfying the
conditions of the exclusion under subdivision y of subsection 1 of section
33.1-24-02-04 shall provide
assurance that funds will be available when needed for care of the facility
under sections
33.1-24-05-59 through
33.1-24-05-73 or subsection 5 of
section 33.1-24-06-16, as
applicable,
Whereas, the GRANTOR has elected to establish a trust to
provide all or part of such financial assurance for the facilities identified
herein,
Whereas, the GRANTOR acting through its duly authorized
officers has selected the TRUSTEE to be the TRUSTEE under this AGREEMENT and
the TRUSTEE is willing to act as TRUSTEE,
Now, therefore, the GRANTOR and the TRUSTEE agree as
follows:
Section 1.
Definitions. As used in this AGREEMENT:
(a) The term GRANTOR means the owner or
operator who enters into this AGREEMENT and any successors or assigns of the
GRANTOR.
(b) The term TRUSTEE means
the TRUSTEE who enters into this AGREEMENT and any successor TRUSTEE.
Section 2.
Identification of
Facilities and Cost Estimate. This AGREEMENT pertains to the facilities
and cost estimates identified on attached schedule A [on schedule A for each
facility list the identification number (if available), name, address, and the
current cost estimates, or portions thereof, for which financial assurance is
demonstrated by this AGREEMENT].
Section
3.
Establishment of FUND. The GRANTOR and the TRUSTEE
hereby establish a trust fund, the FUND, for the benefit of the DEPARTMENT in
the event that the hazardous secondary materials of the GRANTOR no longer meet
the conditions of the exclusion under subdivision y of subsection 1 of section
33.1-24-02-04. The GRANTOR and
the TRUSTEE intend that no third party have access to the FUND, except as
herein provided. The FUND is established initially as consisting of the
property which is acceptable to the TRUSTEE and described in schedule B
attached hereto. Such property and any other property subsequently transferred
to the TRUSTEE is referred to as the FUND, together with all earnings and
profits thereon, less any payments or distributions made by the TRUSTEE
pursuant to this AGREEMENT. The FUND must be held by the TRUSTEE, IN TRUST, as
herein provided. The TRUSTEE is not responsible, nor may it undertake any
responsibility for the amount or adequacy of, nor any duty to collect from the
GRANTOR any payments necessary to discharge any liabilities of the GRANTOR
established by the DEPARTMENT.
Section
4.
Payments from the Fund. The TRUSTEE shall make
payments from the FUND as the DEPARTMENT shall direct, in writing, to provide
for the payment of the costs of the performance of activities required under
sections
33.1-24-05-59 through
33.1-24-05-73 or subsection 5 of
section 33.1-24-06-16 for the facilities
covered by this AGREEMENT. The TRUSTEE shall reimburse the GRANTOR or other
persons as specified by the DEPARTMENT from the FUND for expenditures for such
activities in such amounts as the DEPARTMENT shall direct in writing. In
addition, the TRUSTEE shall refund to the GRANTOR such amounts as the
DEPARTMENT specifies in writing. Upon refund such funds shall no longer
constitute part of the FUND as defined herein.
Section 5.
Payments Comprising the
FUND. Payments made to the TRUSTEE for the FUND must consist of cash or
securities acceptable to the TRUSTEE.
Section
6.
TRUSTEE Management. The TRUSTEE shall invest and
reinvest the principal and income of the FUND and keep the FUND invested as a
single FUND without distinction between principal and income in accordance with
general investment policies and guidelines which the GRANTOR may communicate in
writing to the TRUSTEE from time to time, subject however to the provisions of
this Section. In investing, reinvesting, exchanging, selling, and managing the
FUND, the TRUSTEE shall discharge the TRUSTEE's duties with respect to the
trust fund solely in the interest of the beneficiary and with the care, skill,
prudence, and diligence under the circumstances then prevailing which persons
of prudence, acting in a like capacity and familiar with such matters, would
use in the conduct of an enterprise of a like character and with like aims;
except that:
(a) Securities or other
obligations of the GRANTOR or any other owner or operator of the facilities or
any of their affiliates as defined in the Investment Company Act of 1940, as
amended,
15 U.S.C.
80a-2(a), may not be
acquired or held unless they are securities or other obligations of a federal
or state government;
(b) The
TRUSTEE is authorized to invest the FUND in time or demand deposits of the
TRUSTEE, to the extent insured by an agency of the federal or state government;
and
(c) The TRUSTEE is authorized
to hold cash awaiting investment or distribution uninvested for a reasonable
time and without liability for the payment of interest thereon.
Section 7.
Commingling and
Investment. The TRUSTEE is expressly authorized in its discretion:
(a) To transfer from time to time any or all
of the assets of the FUND to any common, commingled, or collective trust fund
created by the TRUSTEE in which the FUND is eligible to participate, subject to
all of the provisions thereof, to be commingled with the assets of other trusts
participating therein; and
(b) To
purchase shares in any investment company registered under the Investment
Company Act of 1940,
15 U.S.C.
80a-1 et seq., including one which may be
created, managed, underwritten, or to which investment advice is rendered or
the shares of which are sold by the TRUSTEE. The TRUSTEE may vote such shares
in its discretion.
Section
8.
Express Powers of TRUSTEE. Without, in any way,
eliminating the powers and discretions conferred upon the TRUSTEE by the other
provisions of this AGREEMENT or by law, the TRUSTEE is expressly authorized and
empowered:
(a) To sell, exchange, convey,
transfer, or otherwise dispose of any property held by it, by public or private
sale. No person dealing with the TRUSTEE is bound to see the application of the
purchase money or to inquire into the validity or expediency of any such sale
or disposition;
(b) To make,
execute, acknowledge, and deliver any and all documents of transfer and
conveyance and any and all other instruments that may be necessary or
appropriate to carry out the powers herein granted;
(c) To register any securities held in the
FUND in its own name or in the name of a nominee and to hold any security in
bearer form or in book entry, or to combine certificates representing such
securities with certificates of the same issue held by the TRUSTEE in other
fiduciary capacities, or to deposit or arrange for the deposit of such
securities in a qualified central depository even though, when so deposited,
such securities may be merged and held in bulk in the name of the nominee of
such depository with other securities deposited therein by another person, or
to deposit or arrange for the deposit of any securities issued by the United
States Government, or any agency or instrumentality thereof, with a federal
reserve bank, but the books and records of the TRUSTEE shall at all times show
that all such securities are part of the FUND;
(d) To deposit any cash in the FUND in
interest bearing accounts maintained or savings certificates issued by the
TRUSTEE, in its separate capacity, or in any other banking institution
affiliated with the TRUSTEE to the extent insured by an agency of the federal
or state government; and
(e) To
compromise or otherwise adjust all claims in favor of or against the
FUND.
Section 9.
Taxes and Expenses. All taxes of any kind that may be assessed or
levied against or in respect of the FUND and all brokerage commissions incurred
by the FUND shall be paid from the FUND. All other expenses incurred by the
TRUSTEE in connection with the administration of this TRUST, including fees for
legal services rendered to the TRUSTEE, the compensation of the TRUSTEE to the
extent not paid directly by the GRANTOR and all other proper charges and
disbursements of the TRUSTEE, must be paid from the FUND.
Section 10.
Annual Valuation.
The TRUSTEE shall annually, at least thirty days prior to the anniversary date
of establishment of the FUND, furnish to the GRANTOR and to the DEPARTMENT a
statement confirming the value of the TRUST. Any securities in the FUND must be
valued at market value as of no more than sixty days prior to the anniversary
date of establishment of the FUND. The failure of the GRANTOR to object in
writing to the TRUSTEE within ninety days after the statement has been
furnished to the GRANTOR and the DEPARTMENT, constitutes a conclusively binding
assent by the GRANTOR barring the GRANTOR from asserting any claim or liability
against the TRUSTEE with respect to matters disclosed in the
statement.
Section 11.
Advice
of Counsel. The TRUSTEE may from time to time consult with counsel, who
may be counsel to the GRANTOR, with respect to any question arising as to
construction of this AGREEMENT or any action to be taken hereunder. The TRUSTEE
shall be fully protected to the extent permitted by law in acting upon the
advice of counsel.
Section 12.
TRUSTEE Compensation. The TRUSTEE is entitled to reasonable
compensation for its services as agreed upon in writing from time to time with
the GRANTOR.
Section 13.
Successor TRUSTEE. The TRUSTEE may resign or the GRANTOR may
replace the TRUSTEE, but such resignation or replacement is not effective until
the GRANTOR has appointed a successor TRUSTEE and this successor accepts the
appointment. The successor TRUSTEE shall have the same powers and duties as
those conferred upon the TRUSTEE hereunder. Upon the successor TRUSTEE's
acceptance of the appointment, the TRUSTEE shall assign, transfer, and pay over
to the successor TRUSTEE the funds and properties then constituting the FUND.
If for any reason, the GRANTOR cannot or does not act in the event of the
resignation of the TRUSTEE, the TRUSTEE may apply to a court of competent
jurisdiction for the appointment of a successor TRUSTEE or for instructions.
The successor TRUSTEE shall specify the date on which it assumes administration
of the TRUST in a writing sent to the GRANTOR, the DEPARTMENT, and the present
TRUSTEE by certified mail ten days before such change becomes effective. Any
expenses incurred by the TRUSTEE as a result of any of the acts contemplated by
this section must be paid as provided in section 9.
Section 14.
Instructions to the
TRUSTEE. All orders, requests, and instructions by the GRANTOR to the
TRUSTEE must be in writing, signed by such persons as are designated in the
attached Exhibit A, or such other designees as the GRANTOR may designate by
amendment to Exhibit A. The TRUSTEE shall be fully protected in acting without
inquiry in accordance with the GRANTOR's orders, requests, and instructions.
All orders, requests, and instructions by the DEPARTMENT to the TRUSTEE must be
in writing, signed by an authorized DEPARTMENT representative and the TRUSTEE
shall act and be fully protected in acting in accordance with such orders,
requests, and instructions. The TRUSTEE shall have the right to assume, in the
absence of written notice to the contrary, that no event constituting a change
or a termination of the authority of any person to act on behalf of the GRANTOR
or the DEPARTMENT hereunder has occurred. The TRUSTEE shall have no duty to act
in the absence of such orders, requests, and instructions from the GRANTOR or
the DEPARTMENT, or both, except as provided for herein.
Section 15.
Amendment of
AGREEMENT.This AGREEMENT may be Adopted by an instrument in writing
executed by the GRANTOR, the TRUSTEE and the DEPARTMENT, or by the TRUSTEE and
the DEPARTMENT, if the GRANTOR ceases to exist.
Section 16.
Irrevocability and
Termination. Subject to the right of the parties to amend this AGREEMENT
as provided in section 15, this TRUST is irrevocable and continues until
terminated at the written AGREEMENT of the GRANTOR, the TRUSTEE, and the
DEPARTMENT, or by the TRUSTEE and the DEPARTMENT, if the GRANTOR ceases to
exist. Upon termination of the TRUST, all remaining trust property, less final
trust administration expenses, must be delivered to the GRANTOR.
Section 17.
Immunity and
Indemnification. The TRUSTEE may not incur personal liability of any
nature in connection with any act or omission made in good faith in the
administration of this TRUST or in carrying out any directions by the GRANTOR
or the DEPARTMENT issued in accordance with this AGREEMENT. The TRUSTEE must be
indemnified and saved harmless by the GRANTOR or from the trust fund, or both,
from and against any personal liability to which the TRUSTEE may be subjected
by reason of any act or conduct in its official capacity, including all
expenses reasonably incurred in its defense in the event the GRANTOR fails to
provide such defense.
Section 18.
Choice of Law. This AGREEMENT must be administered, construed, and
enforced according to the laws of the state of North Dakota.
Section 19.
Interpretation. As
used in this AGREEMENT, words in the singular include the plural and words in
the plural include the singular. The descriptive headings for each section of
this AGREEMENT do not affect the interpretation or the legal efficacy of this
AGREEMENT.
In Witness Whereof the parties have caused this AGREEMENT to
be executed by their respective officers duly authorized and their corporate
seals to be hereunto fixed and attested as of the date first above written: The
parties below certify that the wording of this AGREEMENT is identical to the
wording specified in subdivision a of subsection 1 of North Dakota
Administrative Code section 33.1-24-02-42 as such regulation was constituted on
the date first above written.
[Signature of GRANTOR]
[Title]
[Attest:]
[Title]
[Seal]
[Signature of TRUSTEE]
[Attest:]
[Title]
[Seal]
b. The following is an example of the
certification of acknowledgment which must accompany the TRUST AGREEMENT for a
trust fund as specified in subsection 1 of section
33.1-24-02-36.
State of _________________________
County of _______________________
On this [date], before me personally came [owner or operator]
to me known, who, being by me duly sworn, did depose and say that she/he
resides at [address], that she/he is [title] of [corporation], the corporation
described in and which executed the above instrument; that she/he knows the
seal of said corporation; that the seal affixed to such instrument is such
corporate seal; that it was so affixed by order of the Board of Directors of
said corporation, and that she/he signed her/his name thereto by like
order.
[Signature of notary public]
2. A surety bond guaranteeing payment into a
trust fund as specified in subsection 2 of section
33.1-24-02-36 must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
FINANCIAL GUARANTEE BOND
Date bond executed: __________________
Effective date: _______________________
Principal: [legal name and business address of owner or
operator]
Type of organization: [insert "individual", "joint venture",
"partnership", or "corporation"]
State of incorporation: _________________
Surety(ies): [name(s) and business address(es)]
Identification number, name, address, and amount or amounts
for each facility guaranteed by this bond: _________
Total penal sum of bond: $ _____________
Surety's bond number: ________________
Know all persons by these presents that we the PRINCIPAL and
SURETY(IES) hereto are firmly bound to the North Dakota Department of
Environmental Quality (hereinafter called the DEPARTMENT) in the event that the
hazardous secondary materials of the GRANTOR no longer meet the conditions of
the exclusion under subdivision y of subsection 1 of section
33.1-24-02-04, in the above
penal sum for the payment of which we bind ourselves, our heirs, executors,
administrators, successors, and assignors jointly and severally: provided that
where the SURETY(IES) are corporations acting as cosureties, we, the SURETIES,
bind ourselves in such sum "jointly and severally" only for the purpose of
allowing a joint action or actions against any or all of us, and for all other
purposes each SURETY binds itself, jointly and severally with the PRINCIPAL,
for the payment of such sum only as is set forth opposite the name of such
SURETY, but if no limit of liability is indicated, the limit of liability shall
be the full amount of the penal sum.
Whereas said PRINCIPAL is required under North Dakota Century
Code chapter 23.1-04 to have a permit or interim status in order to own or
operate each facility identified above, or to meet conditions under subdivision
y of subsection 1 of section
33.1-24-02-04, and
Whereas said PRINCIPAL is required to provide financial
assurance as a condition of permit or interim status or as a condition of an
exclusion under subdivision y of subsection 1 of section
33.1-24-02-04, and
Whereas said PRINCIPAL shall establish a standby trust fund
as is required when a surety bond is used to provide such financial
assurance;
Now, therefore, the conditions of the obligation are such
that if the PRINCIPAL shall faithfully, before the beginning of final closure
of each facility identified above, fund the standby trust fund in the amounts
identified above for the facility,
Or, if the PRINCIPAL shall satisfy all the conditions
established for exclusion of hazardous secondary materials from coverage as
solid waste under subdivision y of subsection 1 of section
33.1-24-02-04,
Or, if the PRINCIPAL shall fund the standby trust fund in
such amounts within fifteen days after an order to begin closure is issued by
the DEPARTMENT or a state or other court of competent jurisdiction,
Or, if the PRINCIPAL shall provide alternate financial
assurance as specified in sections
33.1-24-02-33 through
33.1-24-02-42, as applicable, and obtain the DEPARTMENT's written approval of
such assurance within ninety days after the date of notice of cancellation is
received by both the PRINCIPAL and the DEPARTMENT from the SURETY(IES), then
this obligation shall be null and void, otherwise it is to remain in full force
and effect.
The SURETY(IES) shall become liable on this bond obligation
only when the PRINCIPAL has failed to fulfill the conditions described above.
Upon notification by the DEPARTMENT that the PRINCIPAL has failed to perform as
guaranteed by this bond, the SURETY(IES) shall place funds in the amount
guaranteed for the facility(ies) into the standby trust fund as directed by the
DEPARTMENT.
The liability of the SURETY(IES) shall not be discharged by
any payment or any succession of payments hereunder, unless and until such
payment or payments shall amount in the aggregate to the penal sum of the bond,
but in no event shall the obligation of the SURETY(IES) hereunder exceed the
amount of said penal sum.
The SURETY(IES) may cancel the bond by sending notice of
cancellation by certified mail to the PRINCIPAL and to the DEPARTMENT,
provided, however, that cancellation shall not occur during the one hundred
twenty days beginning on the date of receipt of the notice of cancellation by
both the PRINCIPAL and the DEPARTMENT as evidenced by the return
receipts.
The PRINCIPAL may terminate this bond by sending written
notice to the SURETY(IES) provided, however, that no such notice shall become
effective until the SURETY(IES) receive(s) written authorization for
termination of the bond by the DEPARTMENT.
[The following paragraph is an optional rider that may be
included, but is not required]
The PRINCIPAL and SURETY(IES) hereby agree to adjust the
penal sum of the bond yearly so that it guarantees a new amount, provided that
the penal sum does not increase by more than twenty percent in any one year,
and no decrease in the penal sum takes place without the written permission of
the DEPARTMENT.
In witness whereof, the PRINCIPAL and SURETY(IES) have
executed this financial guarantee bond and have affixed their seals on the date
set forth above.
The persons whose signatures appear below hereby certify that
they are authorized to execute this surety bond on behalf of the PRINCIPAL and
SURETY(IES) and that the wording of this surety bond is identical to the
wording specified in subsection 2 of North Dakota Administrative Code section
33.1-24-02-42 as such rule was constituted on the date this bond was
executed.
PRINCIPAL
[Signature(s)]
[Name(s)]
[Title(s)]
[Corporate seal]
CORPORATE SURETY(IES)
[Name and address]
State of Incorporation: ________________
Liability limit: $ ______________________
[Signature(s)]
[Name(s) and Title(s)]
[Corporate seal]
[For every cosurety, provide signature(s), corporate seal,
and other information in the same manner as for surety above.]
Bond premium: $ ____________________
3. A letter of credit as specified in
subsection 3 of section
33.1-24-02-36 must be worded as
follows except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
IRREVOCABLE STANDBY LETTER OF CREDIT
Director, North Dakota Department of Environmental
Quality
Dear Sir or Madam:
We hereby establish our Irrevocable Standby Letter of Credit
Number __________ in your favor, in the event that the hazardous secondary
materials at the covered reclamation or intermediary facility or facilities no
longer meet the conditions of the exclusion under subdivision y of subsection 1
of section
33.1-24-02-04, at the request
and for the account of [owner's or operator's name and address] up to the
aggregate amount of [in words] United States Dollars $ __________ , available
upon presentation by you of
(1) Your
sight draft bearing reference to this letter of credit Number ____________ ,
and
(2) Your signed statement
reading as follows: "I certify that the amount of the draft is payable pursuant
to regulations issued under authority of North Dakota Century Code chapter
23.1-04".
This letter of credit is effective as of [date] and shall
expire on [date at least one year later], but such expiration date shall be
automatically extended for a period of [at least one year] on [date] and on
each successive expiration date, unless, at least one hundred twenty days
before the current expiration date, we notify both you and [owner's or
operator's name] by certified mail that we have decided not to extend this
letter of credit beyond the current expiration date. In the event you are so
notified, any unused portion of the credit shall be available upon presentation
of your sight draft for one hundred twenty days after the date of receipt by
both you and [owner's or operator's name], as shown on the signed return
receipts.
Whenever this letter of credit is drawn on under and in
compliance with the terms of this credit, we shall duly honor such draft upon
presentation to us, and we shall deposit the amount of the draft directly into
the standby trust fund of [owner's or operator's name] in accordance with your
instructions.
We certify that the wording of this letter of credit is
identical to the wording specified in subsection 3 of North Dakota
Administrative Code section 33.1-24-02-42 as such rule was constituted on the
date shown immediately below.
[Signature(s) and Title(s) of Official(s) of issuing
institution] [Date]
This credit is subject to [insert "the most recent edition of
the Uniform Customs and Practice for Documentary Credits, published and
copyrighted by the International Chamber of Commerce", or "the Uniform
Commercial Code"]
4. A certificate of insurance as specified in
subsection 4 of section
33.1-24-02-36 must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
CERTIFICATE OF INSURANCE
Name and address of insurer (hereinafter called the
"INSURER"): __________
Name and address of insured (hereinafter called the
"INSURED"): __________
Facilities covered: [List for each facility: the
identification number (if any issued), name, address, and amount of insurance
for closure or the amount of insurance for all facilities covered, which must
total the face amount shown below.]
Face amount: _________________________
Policy Number: _________________________
Effective Date: _________________________
The INSURER hereby certifies that it has issued to the
INSURED the policy of insurance identified above to provide financial assurance
so that in accordance with applicable regulations all hazardous secondary
materials can be removed from the facility or any unit at the facility and the
facility or any unit at the facility can be decontaminated at the facilities
identified above. The INSURER further warrants that such policy conforms in all
respects with the requirements of subsection 4 of North Dakota Administrative
Code section
33.1-24-02-36, as applicable and
as such regulations were constituted on the date shown immediately below. It is
agreed that any provision of the policy inconsistent with such rules is hereby
amended to eliminate such inconsistency.
When requested by the North Dakota Department of
Environmental Quality (DEPARTMENT) the INSURER agrees to furnish to the
DEPARTMENT a duplicate original of the policy listed above, including all
endorsements thereon.
I hereby certify that the wording of this certificate is
identical to the wording specified in subsection 4 of North Dakota
Administrative Code section 33.1-24-02-42 as such rule was constituted on the
date shown immediately below.
[Authorized signature for INSURER]
[Name of person signing]
[Title of person signing]
Signature of witness or notary:
_________________________
[Date]
5.
A letter from the chief financial officer, as specified in subsection 5 of
section 33.1-24-02-36, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
LETTER FROM CHIEF FINANCIAL OFFICER
[Address to North Dakota Department of Environmental
Quality].
I am the chief financial officer of [name and address of
firm]. This letter is in support of this firm's use of the financial test to
demonstrate financial assurance, as specified in sections
33.1-24-02-33 through
33.1-24-02-42.
[Fill out the following nine paragraphs regarding facilities
and associated cost estimates. If your firm has no facilities that belong in a
particular paragraph, write "None" in the space indicated. For each facility,
include its identification number (if any issued), name, address, and current
cost estimates.]
1. This firm is the
owner or operator of the following facilities for which financial assurance is
demonstrated through the financial test specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates covered by the test are shown for
each facility: ____.
2. This firm
guarantees, through the guarantee specified in sections
33.1-24-02-33 through
33.1-24-02-42, the following facilities owned or operated by the guaranteed
party. The current cost estimates so guaranteed are shown for each facility:
_________ . The firm identified above is [insert one or more:
(1) The direct or higher-tier parent
corporation of the owner or operator;
(2) owned by the same parent corporation as
the parent corporation of the owner or operator, and receiving the following
value in consideration of this guarantee _________ ; or
(3) engaged in the following substantial
business relationship with the owner or operator _________ , and receiving the
following value in consideration of this guarantee ___________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such relationship to this letter.]
3. This firm, as owner or operator or
guarantor, is demonstrating financial assurance for the following facilities
through the use of the financial test specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates covered by such a test are shown for
each facility: _____ .
4. This firm
is the owner or operator of the following hazardous secondary materials
management facilities for which financial assurance is not demonstrated to the
DEPARTMENT through the financial test or any other financial assurance
mechanism specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates not covered by such financial
assurance are shown for each facility: _____ .
5. This firm is the owner or operator of the
following underground injection control facilities for which financial
assurance for plugging and abandonment is required under 40 CFR part 144. The
current closure cost estimates as required by
40 CFR
144.62 are shown for each facility:
__________ .
6. This firm is the
owner or operator of the following facilities for which financial assurance for
closure or postclosure care is demonstrated through the financial test
specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16. The current
closure and/or postclosure cost estimates covered by the test are shown for
each facility: ______________ .
7.
This firm guarantees, through the guarantee specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16, the closure or
postclosure care of the following facilities owned or operated by the
guaranteed party. The current cost estimates for the closure or postclosure
care so guaranteed are shown for each facility: _________ . The firm identified
above is [insert one or more:
(1) the direct
or higher-tier parent corporation of the owner or operator;
(2) owned by the same parent corporation as
the parent corporation of the owner or operator, and receiving the following
value in consideration of this guarantee ___________ ; or
(3) engaged in the following substantial
business relationship with the owner or operator __________ , and receiving the
following value in consideration of this guarantee ____________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such relationship to this letter.]
8. This firm, as owner or operator or
guarantor, is demonstrating financial assurance for the closure or postclosure
care of the following facilities through the use of the financial test
specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16. The current
closure and/or postclosure cost estimates covered by such a test are shown for
each facility: ____________ .
9.
This firm is the owner or operator of the following hazardous waste management
facilities for which financial assurance for closure or, if a disposal
facility, postclosure care, is not demonstrated to the DEPARTMENT through the
financial test or any other financial assurance mechanism specified in sections
33.1-24-05-74 through
33.1-24-05-88 and subsection 5
of section
33.1-24-06-16. The current
closure and/or postclosure estimates not covered by such financial assurance
are shown for each facility: _________ .
This firm [insert "is required" or "is not required"] to file
a form 10K with the securities and exchange commission for the latest fiscal
year.
The fiscal year of this firm ends on [month, day]. The
figures for the following items marked with an asterisk are derived from this
firm's independently audited, year-end financial statements for the latest
completed fiscal year, ended [date].
[Fill in Alternative I if the criteria of paragraph 1 of
subdivision a of subsection 5 of section
33.1-24-02-36 are used. Fill in
Alternative II if the criteria of paragraph 2 of subdivision a of subsection 5
of section
33.1-24-02-36 are used.]
|
Alternative I
|
|
1. Sum of current cost estimate (total of all costs
estimates shown in the nine paragraphs above). $ _________
|
|
*2. Total liabilities (if any portion of the cost
estimate is included in total liabilities, you may deduct the amount of that
portion from this line and add that amount to lines 3 and 4). $ ________
|
|
*3. Tangible net worth. $ ________
|
|
*4. Net worth. $ _______________
|
|
*5. Current assets. $ ___________
|
|
*6. Current liabilities. $ __________
|
|
7. Net working capital (line 5 minus line 6). $
__________
|
|
*8. The sum of net income plus depreciation,
depletion, and amortization. $ _________
|
|
*9. Total assets in the United States (required
only if less than 90% of firm's assets are located in the United States). $
____________
|
|
Yes
|
|
No
|
|
10. Is line 3 at least $10 million?
|
|
11. Is line 3 at least 6 times line 1?
|
|
12. Is line 7 at least 6 times line 1?
|
|
*13. Are at least 90% of firm's assets located in
the United States? If not, complete line 14.
|
|
14. Is line 9 at least 6 times line 1?
|
|
15. Is line 2 divided by line 4 less than
2.0?
|
|
16. Is line 8 divided by line 2 greater than
0.1?
|
|
17. Is line 5 divided by line 6 greater than
1.5?
|
|
Alternative II
|
|
1. Sum of current cost estimates (total of all cost
estimates shown in the nine paragraphs above). $ ___________
|
|
2. Current bond rating of most recent issuance of
this firm and name of rating service. $ __________
|
|
3. Date of issuance of bond. $ ___________
|
|
4. Date of maturity of bond. $ ____________
|
|
*5. Tangible net worth (if any portion of the cost
estimates is included in "total liabilities" on your firm's financial
statements, you may add the amount of that portion to this line). $
____________
|
|
*6. Total assets in United States (required only if
less than 90% of firm's assets are located in the United States). $
_____________
|
|
Yes
|
|
No
|
|
7. Is line 5 at least $10 million?
|
|
8. Is line 5 at least 6 times line 1?
|
|
*9. Are at least 90% of firm's assets located in
the United States? If not, complete line 10.
|
|
10. Is line 6 at least 6 times line 1?
|
I hereby certify that the wording of this letter is identical
to the wording specified in subsection 5 of section 33.1-24-02-42 as such
regulations were constituted on the date shown immediately below.
[Signature]
[Name]
[Title]
[Date]
6. A letter from the chief financial officer,
as specified in subsection 6 of section
33.1-24-02-40, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
LETTER FROM CHIEF FINANCIAL OFFICER
[Address to North Dakota Department of Environmental
Quality.]
I am the chief financial officer of [firm's name and
address]. This letter is in support of the use of the financial test to
demonstrate financial responsibility for liability coverage under section
33.1-24-02-40 [insert "and costs
assured subsection 5 of section
33.1-24-02-36" if applicable] as
specified in sections
33.1-24-02-33 through
33.1-24-02-42.
[Fill out the following paragraphs regarding facilities and
liability coverage. If there are no facilities that belong in a particular
paragraph, write "None" in the space indicated. For each facility, include its
identification number (if any issued), name, and address.]
The firm identified above is the owner or operator of the
following facilities for which liability coverage for [insert "sudden" or
"nonsudden" or "both sudden and nonsudden"] accidental occurrence is being
demonstrated through the financial test specified in sections
33.1-24-02-33 through
33.1-24-02-42:
The firm identified above guarantees, through the guarantee
specified in sections
33.1-24-02-33 through
33.1-24-02-42, liability coverage for [insert "sudden" or "nonsudden" or "both
sudden and nonsudden"] accidental occurrences at the following facilities owned
or operated by the following: _________ . The firm identified above is [insert
one or more:
(1) the direct or
higher-tier parent corporation of the owner or operator;
(2) owned by the same parent corporation as
the parent corporation of the owner or operator, and receiving the following
value in consideration of this guarantee; or
(3) engaged in the following substantial
business relationship with the owner or operator _________ , and receiving the
following value in consideration of this guarantee _________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such relationship to this letter.]
The firm identified above is the owner or operator of the
following facilities for which liability coverage for [insert "sudden" or
"nonsudden" or "both sudden and nonsudden"] accidental occurrences is being
demonstrated through the financial test specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16.
The firm identified above guarantees, through the guarantee
specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16, liability
coverage for [insert "sudden" or "nonsudden" or "both sudden and nonsudden"]
accidental occurrences at the following facilities owned or operated by the
following: _________ . The firm identified above is [insert one or more:
(1) the direct or
higher-tier parent corporation of the owner or operator;
(2) owned by the same parent corporation as the parent
corporation of the owner or operator, and receiving the following value in
consideration of this guarantee __________ ; or
(3) engaged in the following substantial
business relationship with the owner operator ________ , and receiving the
following value in consideration of this guarantee ________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such relationship to this letter.]
[If you are using the financial test to demonstrate coverage
of both liability and costs assured under subsection 5 of section
33.1-24-02-36 or closure or
postclosure case costs under sections
33.1-24-05-77 or subsection 5 of
section 33.1-24-06-16, fill in the
following nine paragraphs regarding facilities and associated cost estimates.
If there are no facilities that belong in a particular paragraph, write "None"
in the space indicated. For each facility, include its identification number
(if any issued), name, address, and current cost estimates.]
1. This firm is the owner or operator of the
following facilities for which financial assurance is demonstrated through the
financial test specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates covered by the test are shown for
each facility _____ .
2. This firm
guarantees, through the guarantee specified in sections
33.1-24-02-33 through
33.1-24-02-42, the following facilities owned or operated by the guaranteed
party. The current cost estimates so guaranteed are shown for each facility:
____. The firm identified above is [insert one or more:
(1) the direct or higher-tier parent
corporation of the owner or operator;
(2) owned by the same parent corporation as the parent
corporation of the owner or operator, and receiving the following value in
consideration of this guarantee _______ ; or
(3) engaged in the following substantial
business relationship with the owner or operator _______ , and receiving the
following value in consideration of this guarantee ________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such relationship to this letter.]
3. This firm, as owner or operator or
guarantor, is demonstrating financial assurance for the following facilities
through the use of the financial test specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates covered by such a test are shown for
each facility: _____ .
4. This firm
is the owner or operator of the following hazardous secondary materials
management facilities for which financial assurance is not demonstrated to the
DEPARTMENT through the financial test or any other financial assurance
mechanism specified in sections
33.1-24-02-33 through
33.1-24-02-42. The current cost estimates not covered by such financial
assurance are shown for each facility: _____ .
5. This firm is the owner or operator or
guarantor of the following underground injection control facilities for which
financial assurance for plugging and abandonment is required under 40 CFR part
144. The current closure cost estimates as required by
40 CFR
144.62 are shown for each facility: _______
.
6. This firm is the owner or
operator of the following facilities for which financial assurance for closure
or postclosure care is demonstrated through the financial test specified in
sections
33.1-24-05-74 through
33.1-24-05-88 and subsection 5
of section
33.1-24-06-16. The current
closure and/or postclosure cost estimates covered by the test are shown for
each facility: _________ .
7. This
firm guarantees, through the guarantee specified in sections
33.1-24-05-74 through
33.1-24-05-88 and subsection 5
of section
33.1-24-06-16, the closure or
postclosure care of the following facilities owned or operated by the
guaranteed party. The current cost estimates for the closure or postclosure
care so guaranteed are shown for each facility: _________ . The firm identified
above is the [insert one or more:
(1) the
direct or higher-tier parent corporation of the owner or operator;
(2) owned by the same parent corporation as
the parent corporation of the owner or operator, and receiving the following
value in consideration of this guarantee: _________ ; or
(3) engaged in the following substantial
business relationship with the owner or operator: _________ , and receiving the
following value in consideration of this guarantee: _________ ]. [Attach a
written description of the business relationship or a copy of the contract
establishing such a relationship to this letter.]
8. This firm, as owner or operator or
guarantor, is demonstrating financial assurance for the closure or postclosure
care of the following facilities through the use the financial test specified
in sections
33.1-24-05-74 through
33.1-24-05-88. The current
closure and/or postclosure cost estimates covered by such a test are shown for
each facility: _________ .
9. This
firm is the owner or operator of the following hazardous waste management
facilities for which financial assurance for closure or, if a disposal
facility, postclosure care, is not demonstrated to the DEPARTMENT through the
financial test or any other financial assurance mechanism specified in sections
33.1-24-05-74 through
33.1-24-05-88 or subsection 5 of
section 33.1-24-06-16. The current
closure and/or postclosure cost estimates not covered by such financial
assurance are shown for each facility: _________ .
This firm [insert "is required" or "is not required"] to file
a form 10K with the securities and exchange commission for the latest fiscal
year.
The fiscal year of this firm ends on [month, day]. The
figures for the following items marked with an asterisk are derived from this
firm's independently audited, year-end financial statements for the latest
completed fiscal year, ended [date].
Part A. Liability Coverage for Accidental Occurrences
[Fill in Alternative I if the criteria of paragraph 1 of
subdivision a of subsection 6 of section
33.1-24-02-40 are used. Fill in
Alternative II if the criteria of paragraph 2 of subdivision a of subsection 6
of section
33.1-24-02-40 are used.]
|
Alternative I
|
|
1. Amount of annual aggregate liability coverage to
be demonstrated. $ _________
|
|
*2. Current assets. $ ___________
|
|
*3. Current liabilities. $ __________
|
|
4. Net working capital (line 2 minus line 3). $
__________
|
|
*5. Tangible net worth. $ ________
|
|
*6. If less than 90% of assets are located in the
United States, give total United States
|
|
assets. $ _________
|
|
Yes
|
|
No
|
|
7. Is line 5 at least $10 million?
|
|
8. Is line 4 at least 6 times line 1?
|
|
9. Is line 5 at last 6 times line 1?
|
|
*10. Are at least 90% of assets located in the
United States?
|
|
If not, complete line 11.
|
|
11. Is line 6 at least 6 times line 1?
|
|
Alternative II
|
|
1. Amount of annual aggregate liability coverage to
be demonstrated. $ ________
|
|
2. Current bond rating of most recent issuance and
name of rating service.
|
|
3. Date of issuance of bond.
|
|
4. Date of maturity of bond.
|
|
*5. Tangible net worth. $ _______
|
|
*6. Total assets in United States (required only if
less than 90% of assets are located in
|
|
the United States). $ ______
|
|
Yes
|
|
No
|
|
7. Is line 5 at least $10 million?
|
|
8. Is line 5 at least 6 times line 1?
|
|
9. Are at least 90% of assets located in the United
States?
|
|
If not, complete line 10.
|
|
10. Is line 6 at least 6 times line 1?
|
[Fill in part B if you are using the financial test to
demonstrate assurance of both liability coverage and costs assured under
subsection 5 of section
33.1-24-02-36 or closure or
postclosure care costs under section
33.1-24-05-77 or subsection 5 of
section 33.1-24-06-16.]
Part B. Facility Care and Liability Coverage
[Fill in Alternative I if the criteria of paragraph 1 of
subdivision a of subsection 5 of section
33.1-24-02-36 and paragraph 1 of
subdivision a of subsection 6 of section
33.1-24-02-40 are used. Fill in
Alternative II if the criteria of paragraph 2 of subdivision a of subsection 5
of section
33.1-24-02-36 and paragraph 2 of
subdivision a of subsection 6 of section
33.1-24-02-40 are used.]
|
Alternative I
|
|
1. Sum of current cost estimates (total of all cost
estimates listed above). $ _______
|
|
2. Amount of annual aggregate liability coverage to
be demonstrated. $ ________
|
|
3. Sum of lines 1 and 2. $ ________
|
|
*4. Total liabilities (if any portion of your
closure or postclosure cost estimates is included
|
|
in your total liabilities, you may deduct that
portion from this line and add that amount
|
|
to lines 5 and 6). $ __________
|
|
*5. Tangible net worth. $ _________
|
|
*6. Net worth. $ ____________
|
|
*7. Current assets. $ ________
|
|
*8. Current liabilities. $ _______
|
|
9. Net working capital (line 7 minus line 8). $
_________
|
|
*10. The sum of net income plus depreciation,
depletion, and amortization. $ _________
|
|
*11. Total assets in United States (required only
if less than 90% of assets are located in
|
|
the United States). $ ________
|
|
Yes
|
|
No
|
|
12. Is line 5 at least $10 million?
|
|
13. Is line 5 at least 6 times line 3?
|
|
14. Is line 9 at least 6 times line 3?
|
|
*15. Are at least 90% of assets located in the
United States?
|
|
If not, complete line 16.
|
|
16. Is line 11 at least 6 times line 3?
|
|
17. Is line 4 divided by line 6 less than
2.0?
|
|
18. Is line 10 divided by line 4 greater than
0.1?
|
|
19. Is line 7 divided by line 8 greater than
1.5?
|
|
Alternative II
|
|
1. Sum of current cost estimate (total of all cost
estimates listed above). $ ________
|
|
2. Amount of annual aggregate liability coverage to
be demonstrated. $ ________
|
|
3. Sum of lines 1 and 2. $ _______
|
|
4. Current bond rating of most recent issuance and
name of rating service.
|
|
*5. Date of issuance of bond.
|
|
*6. Date of maturity of bond.
|
|
*7. Tangible net worth (if any portion of the cost
estimates is included in "total liabilities" on
|
|
your financial statements you may add that portion
to this line). $ _______
|
|
*8. Total assets in the United States (required
only if less than 90% of assets are located
|
|
in the United States). $ _______
|
|
Yes
|
|
No
|
|
9. Is line 7 at least $10 million?
|
|
10. Is line 7 at least 6 times line 3?
|
|
*11. Are at least 90% of assets located in the
United States?
|
|
If not, complete line 12.
|
|
12. Is line 8 at least 6 times line 3?
|
I hereby certify that the wording of this letter is identical
to the wording specified in subsection 6 of section 33.1-24-02-42 as such
regulations were constituted on the date shown immediately below.
[Signature]
[Name]
[Title]
[Date]
7. Corporate guarantee for facility care.
a. A corporate guarantee, as specified in
subsection 5 of section
33.1-24-02-36, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
CORPORATE GUARANTEE FOR FACILITY CARE
Guarantee made this [date] by [name of guaranteeing entity],
a business corporation organized under the laws of the state of [insert name of
state], herein referred to as guarantor. This guarantee is made on behalf of
the [owner or operator] of [business address], which is [one of the following:
"our subsidiary"; "a subsidiary of [name and address of common parent
corporation], of which guarantor is a subsidiary"; or "an entity with which
guarantor has a substantial business relationship, as defined in subsection 8
of section
33.1-24-05-75"] to the
DEPARTMENT.
Recitals
1.
Guarantor meets or exceeds the financial test criteria and agrees to comply
with the reporting requirements for guarantors as specified in subsection 5 of
section 33.1-24-02-36.
2. [Owner or operator] owns or operates the
following facility(ies) covered by this guarantee: [List for each facility:
identification number (if any issued), name, and address.]
3. "Closure plans" as used below refer to the
plans maintained as required by sections
33.1-24-02-33 through
33.1-24-02-42 for the care of facilities as identified above.
4. For value received from [owner or
operator], guarantor guarantees that in the event of a determination by the
department that the hazardous secondary materials at the owner's or operator's
facility covered by this guarantee do not meet the conditions of the exclusion
under subdivision y of subsection 1 of section
33.1-24-02-04, the guarantor
shall dispose of any hazardous secondary material as hazardous waste, and close
the facility in accordance with closure requirements found in sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819 or subsection 5
of section
33.1-24-06-16, as applicable, or
establish a trust fund as specified in subsection 1 of section
33.1-24-02-36 in the name of the
owner or operator in the amount of the current cost estimate.
5. Guarantor agrees that if, at the end of
any fiscal year before termination of this guarantee, the guarantor fails to
meet the financial test criteria, guarantor shall send within ninety days, by
certified mail, notice to the DEPARTMENT and to [owner or operator] that the
guarantor intends to provide alternate financial assurance as specified in
sections
33.1-24-02-33 through
33.1-24-02-42, as applicable, in the name of [owner or operator]. Within one
hundred twenty days after the end of such fiscal year, the guarantor shall
establish such financial assurance unless [owner or operator] has done
so.
6. The guarantor agrees to
notify the DEPARTMENT by certified mail, of a voluntary or involuntary
proceeding under title 11 (bankruptcy), United States Code, naming guarantor as
debtor, within ten days after commencement of the proceeding.
7. Guarantor agrees that within thirty days
after being notified by the DEPARTMENT of a determination that guarantor no
longer meets the financial test criteria or that the guarantor is disallowed
from continuing as a guarantor, the guarantor shall establish alternate
financial assurance as specified in sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559, and
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, or sections
33.1-24-02-33 through
33.1-24-02-42, as applicable, in the name of [owner or operator] unless [owner
or operator] has done so.
8.
Guarantor agrees to remain bound under this guarantee notwithstanding any or
all of the following: amendment or modification of the closure plan, the
extension or reduction of the time of performance, or any other modification or
alteration of an obligation of the owner or operator pursuant to sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, or sections
33.1-24-02-33 through
33.1-24-02-42.
9. Guarantor agrees
to remain bound under this guarantee for as long as [owner or operator] must
comply with the applicable financial assurance requirements of sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819 and subsection 5
of section
33.1-24-06-16 or the financial
assurance condition of subparagraph f of paragraph 6 of subdivision y of
subsection 1 of section
33.1-24-02-04 for the above
listed facilities, except as provided in paragraph 10 of this
AGREEMENT.
10. [Insert the
following language if the guarantor is (a) a direct or higher-tier corporate
parent, or (b) a firm whose parent corporation is also the parent corporation
of the owner or operator]:
Guarantor may terminate this guarantee by sending notice by
certified mail to the DEPARTMENT and to [owner or operator], provided that this
guarantee may not be terminated unless and until [the owner or operator]
obtains, and the DEPARTMENT approves, alternate coverage complying with section
33.1-24-02-36.
[Insert the following language if the guarantor is a firm
qualifying as a guarantor due to its "substantial business relationship" with
its owner or operator.]
Guarantor may terminate this guarantee one hundred twenty
days following the receipt of notification, through certified mail, by the
DEPARTMENT and by [the owner or operator].
11. Guarantor agrees that if [owner or
operator] fails to provide alternate financial assurance as specified in
sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, or sections
33.1-24-02-33 through
33.1-24-02-42, as applicable, and obtain written approval of such assurance
from the DEPARTMENT within ninety days after a notice of cancellation by the
guarantor is received by the DEPARTMENT from guarantor, guarantor shall provide
such alternate financial assurance in the name of [owner or
operator].
12. Guarantor expressly
waives notice of acceptance of this guarantee by the DEPARTMENT or by [owner or
operator]. Guarantor also expressly waives notice of amendments or
modifications of the closure plan and of amendments or modifications of the
applicable requirements of sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559 and
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, or sections
33.1-24-02-33 through
33.1-24-02-42.
I hereby certify that the wording of this guarantee is
identical to the wording specified in subdivision a of subsection 7 of section
33.1-24-02-42 as such regulations were constituted on the date first above
written.
Effective date:
[Name of guarantor]
[Authorized signature for guarantor]
[Name of person signing]
[Title of person signing]
Signature of witness or notary:
b. A guarantee, as specified in subsection 7
of section
33.1-24-02-40, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
GUARANTEE FOR LIABILITY COVERAGE
Guarantee made this [date] by [name of guaranteeing entity],
a business corporation organized under the laws of [if incorporated within the
United States insert "the state of " and insert name of state; if incorporated
outside the United States insert the name of the country in which incorporated,
the principal place of business within the United States, and the name and
address of the registered agent in the state of the principal place of
business], herein referred to as guarantor. This guarantee is made on behalf of
[owner or operator] of [business address], which is one of the following: "our
subsidiary"; "a subsidiary of [name and address of common parent corporation],
of which guarantor is a subsidiary"; or "an entity with which guarantor has a
substantial business relationship, as defined in subsection 8 of section
33.1-24-05-75", to any and all
third parties who have sustained or may sustain bodily injury or property
damage caused by [sudden and/or nonsudden] accidental occurrences arising from
operation of the facility(ies) covered by this guarantee.
Recitals
1.
Guarantor meets or exceeds the financial test criteria and agrees to comply
with the reporting requirements for guarantors as specified in subsection 7 of
section 33.1-24-02-40.
2. [Owner or operator] owns or operates the
following facility(ies) covered by this guarantee: [List for each facility:
identification number (if any issued), name, and address; and if guarantor is
incorporated outside the United States list the name and address of the
guarantor's registered agent in each state.] This corporate guarantee satisfies
Resource Conservation and Recovery Act third-party liability requirements for
[insert "sudden" or "nonsudden" or "both sudden and nonsudden"] accidental
occurrences in above-named owner or operator facilities for coverage in the
amount of [insert dollar amount] for each occurrence and [insert dollar amount]
annual aggregate.
3. For value
received from [owner or operator], guarantor guarantees to any and all third
parties who have sustained or may sustain bodily injury or property damage
caused by [sudden and/or nonsudden] accidental occurrences arising from
operations of the facility(ies) covered by this guarantee that in the event
that [owner or operator] fails to satisfy a judgment or award based on a
determination of liability for bodily injury or property damage to third
parties caused by [sudden and/or nonsudden] accidental occurrences, arising
from the operation of the above-named facilities, or fails to pay an amount
agreed to in settlement of a claim arising from or alleged to arise from such
injury or damage, the guarantor will satisfy such judgment(s), award(s), or
settlement agreement(s) up to the limits of coverage identified
above.
4. Such obligation does not
apply to any of the following:
(a) Bodily
injury or property damage for which [insert owner or operator] is obligated to
pay damages by reason of the assumption of liability in a contract or
agreement. This exclusion does not apply to liability for damages that [insert
owner or operator] would be obligated to pay in the absence of the contract or
agreement.
(b) Any obligation of
[insert owner or operator] under a workers' compensation, disability benefits,
or unemployment compensation law or any similar law.
(c) Bodily injury to:
(1) An employee of [insert owner or operator]
arising from, and in the course of, employment by [insert owner or operator];
or
(2) The spouse, child, parent,
brother, or sister of that employee as a consequence of, or arising from, and
in the course of employment by [insert owner or operator]. This exclusion
applies:
(A) Whether [insert owner or
operator] may be liable as an employer or in any other capacity; and
(B) To any obligation to share damages with
or repay another person who must pay damages because of the injury to persons
identified in paragraphs (1) and (2).
(d) Bodily injury or property damage arising
out of the ownership, maintenance, use, or entrustment to others of any
aircraft, motor vehicle, or watercraft.
(e) Property damage to:
(1) Any property owned, rented, or occupied
by [insert owner or operator];
(2)
Premises that are sold, given away, or abandoned by [insert owner or operator]
if the property damage arises out of any part of those premises;
(3) Property loaned to [insert owner or
operator];
(4) Personal property in
the care, custody, or control of [insert owner or operator]; or
(5) That particular part of real property on
which [insert owner or operator] or any contractors or subcontractors working
directly or indirectly on behalf of [insert owner or operator] are performing
operations, if the property damage arises out of these operations.
5. Guarantor agrees
that if, at the end of any fiscal year before termination of this guarantee,
the guarantor fails to meet the financial test criteria, guarantor shall send
within ninety days, by certified mail, notice to the DEPARTMENT and to [owner
or operator] that the guarantor intends to provide alternate liability coverage
as specified in section
33.1-24-02-40, as applicable, in
the name of [owner or operator]. Within one hundred twenty days after the end
of such fiscal year, the guarantor shall establish such liability coverage
unless [owner or operator] has done so.
6. The guarantor agrees to notify the
DEPARTMENT by certified mail of a voluntary or involuntary proceeding under
title 11 (bankruptcy), United States Code, naming guarantor as debtor, within
ten days after commencement of the proceeding. Guarantor agrees that within
thirty days after being notified by the DEPARTMENT of a determination that
guarantor no longer meets the financial test criteria or that the guarantor is
disallowed from continuing as a guarantor, the guarantor shall establish
alternate liability coverage as specified in section
33.1-24-02-40 in the name of
[owner or operator], unless [owner or operator] has done so.
7. Guarantor reserves the right to modify
this AGREEMENT to take into account amendment or modification of the liability
requirements set by section
33.1-24-02-40, provided that
such modification shall become effective only if the DEPARTMENT does not
disapprove the modification within thirty days of receipt of notification of
the modification.
8. Guarantor
agrees to remain bound under this guarantee for so long as [owner or operator]
must comply with the applicable requirements of section
33.1-24-02-40 for the
above-listed facility(ies), except as provided in paragraph 10 of this
AGREEMENT.
9. [Insert the following
language if the guarantor is (a) a direct or higher-tier corporate parent, or
(b) a firm whose parent corporation is also the parent corporation of the owner
or operator]:
10. Guarantor may
terminate this guarantee by sending notice by certified mail to the DEPARTMENT
and to [owner or operator], provided that this guarantee may not be terminated
unless and until [the owner or operator] obtains, and the DEPARTMENT approves,
alternate liability coverage complying with section
33.1-24-02-40.
[Insert the following language if the guarantor is a firm
qualifying as a guarantor due to its "substantial business relationship" with
the owner or operator]:
Guarantor may terminate this guarantee one hundred twenty
days following receipt of notification, through certified mail, by the
DEPARTMENT and by [the owner or operator].
11. Guarantor hereby expressly waives notice
of acceptance of this guarantee by any party.
12. Guarantor agrees that this guarantee is
in addition to and does not affect any other responsibility or liability of the
guarantor with respect to the covered facilities.
13. The guarantor shall satisfy a third-party
liability claim only on receipt of one of the following documents:
(a) Certification from the principal and the
third-party claimant(s) that the liability claim should be paid. The
certification must be worded as follows, except that instructions in brackets
are to be replaced with the relevant information and the brackets deleted:
CERTIFICATION OF VALID CLAIM
The undersigned, as parties [insert principal] and [insert
name and address of third-party claimant(s)], hereby certify that the claim of
bodily injury and/or property damage caused by a [sudden or nonsudden]
accidental occurrence arising from operating [principal's] facility should be
paid in the amount of $ __.
[Signatures]
Principal
(Notary) Date
[Signatures]
Claimant(s)
(Notary) Date
(b) A valid final court order establishing a
judgment against the principal for bodily injury or property damage caused by
sudden or nonsudden accidental occurrences arising from the operation of the
principal's facility or group of facilities.
14. In the event of combination of this
guarantee with another mechanism to meet liability requirements, this guarantee
will be considered [insert "primary" or "excess"] coverage.
I hereby certify that the wording of the guarantee is
identical to the wording specified in subdivision b of subsection 7 of section
33.1-24-02-42 as such regulations were constituted on the date shown
immediately below.
Effective date: ____________________
[Name of guarantor] ____________________
[Authorized signature for guarantor]
____________________
[Name of person signing] ____________________
[Title of person signing] ____________________
Signature of witness or notary: ____________________
8. A
hazardous waste facility liability endorsement as required in section
33.1-24-02-40 must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
HAZARDOUS SECONDARY MATERIAL RECLAMATION/INTERMEDIATE
FACILITY LIABILITY ENDORSEMENT
1. This
endorsement certifies that the policy to which the endorsement is attached
provides liability insurance covering bodily injury and property damage in
connection with the insured's obligation to demonstrate financial
responsibility under North Dakota Administrative Code section
33.1-24-02-40. The coverage
applies at [list identification number (if any issued), name, and address for
each facility] for [insert "sudden accidental occurrences", "nonsudden
accidental occurrences", or "sudden and nonsudden accidental occurrences"; if
coverage is for multiple facilities and the coverage is different for different
facilities, indicate which facilities are insured for sudden accidental
occurrences, which are insured for nonsudden accidental occurrences and which
are insured for both]. The limits of liability are [insert the dollar amount of
the "each occurrence" and "annual aggregate" limits of the insurer's
liability], exclusive of legal defense costs.
2. The insurance afforded with respect to
such occurrences is subject to all of the terms and conditions of the policy;
provided, however, that any provisions of the policy inconsistent with
subsections (a) through (e) of this paragraph 2 are hereby amended to conform
with subsections (a) through (e):
(a)
Bankruptcy or insolvency of the insured shall not relieve the insurer of its
obligations under the policy to which this endorsement is attached.
(b) The insurer is liable for the payment of
amounts within any deductible applicable to this policy, with a right of
reimbursement by the insured for any such payment made by the insurer. This
provision does not apply with respect to that amount of any deductible for
which coverage is demonstrated as specified in subsection 6 of North Dakota
Administrative Code section
33.1-24-02-40.
(c) When requested by the DEPARTMENT, the
insurer agrees to furnish to the DEPARTMENT a signed duplicate original of the
policy and all endorsements.
(d)
Cancellation of this endorsement, whether by the insurer, the insured, a parent
corporation providing insurance coverage for its subsidiary, or by a firm
having an insurable interest in and obtaining liability insurance on behalf of
the owner or operator of the facility, will be effective only upon written
notice and only after the expiration of sixty days after a copy of such written
notice is received by the DEPARTMENT.
(e) Any other termination of this endorsement
will be effective only upon written notice and only after the expiration of
thirty days after a copy of such written notice is received by the DEPARTMENT,
as evidenced by the return receipt.
Attached to and forming part of policy number ___ issued by
[name of insurer], herein called the insurer of [address of insurer] to [name
of insured] of [address] this ___ day of ___, 20__. The effective date of said
policy is ___ day of ___, 20__.
I hereby certify that the wording of this endorsement is
identical to the wording specified in subsection 8 of North Dakota
Administrative Code section 33.1-24-02-42 as such rule was constituted on the
date first above written, and that the insurer is licensed to transact the
business of insurance in the state of North Dakota or eligible to provide
insurance as an excess or surplus lines insurer in one or more states.
[Signature of authorized representative of insurer]
[Type name]
[Title], authorized representative of [name of
insurer]
[Address of representative]
9. A certificate of liability
insurance as required in section
33.1-24-02-40 must be worded as
follows, except that the instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
HAZARDOUS SECONDARY MATERIAL RECLAMATION/INTERMEDIATE
FACILITY CERTIFICATE OF LIABILITY INSURANCE
1. [Name of insurer], (the "insurer") of
[address of insurer] hereby certifies that it has issued liability insurance
covering bodily injury and property damage to [name of insured], (the
"insured"), of [address of insured] in connection with the insured's obligation
to demonstrate financial responsibility under sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559,
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, and the financial
assurance condition of subparagraph f of paragraph 6 of subdivision y of
subsection 1 of section
33.1-24-02-04. The coverage
applies at [list identification number (if any issued), name, and address for
each facility] for [insert "sudden accidental occurrences", "nonsudden
accidental occurrences", or "sudden and nonsudden accidental occurrences"; if
coverage is for multiple facilities and the coverage is different for different
facilities, indicate which facilities are insured for sudden accidental
occurrences, which are insured for nonsudden accidental occurrences, and which
are insured for both]. The limits of liability are [insert the dollar amount of
the "each occurrence" and "annual aggregate" limits of the insurer's
liability], exclusive of legal defense costs. The coverage is provided under
policy number____, issued on [date]. The effective date of said policy is
[date].
2. The insurer further
certifies the following with respect to the insurance described in paragraph 1:
(a) Bankruptcy or insolvency of the insured
shall not relieve the insurer of its obligations under the policy.
(b) The insurer is liable for the payment of
amounts within any deductible applicable to the policy, with a right of
reimbursement by the insured for any such payment made by the insurer. This
provision does not apply with respect to that amount of any deductible for
which coverage is demonstrated as specified in North Dakota Administrative Code
section 33.1-24-02-40.
(c) When requested by the DEPARTMENT, the
insurer agrees to furnish to the DEPARTMENT a signed duplicate original of the
policy and all endorsements.
(d)
Cancellation of the insurance, whether by the insurer, the insured, a parent
corporation providing insurance coverage for its subsidiary, or by a firm
having an insurable interest in and obtaining liability insurance on behalf of
the owner or operator of the hazardous waste management facility, will be
effective only upon written notice, and only after the expiration of sixty days
after a copy of such written notice is received by the DEPARTMENT.
(e) Any other termination of the insurance
will be effective only upon written notice, and only after the expiration of
thirty days after a copy of such written notice is received by the DEPARTMENT,
as evidenced by the return receipt.
I hereby certify that the wording of this instrument is
identical to the wording specified in subsection 9 of North Dakota
Administrative Code section 33.1-24-02-42, as such regulation was constituted
on the date first above written, and that the insurer is licensed to transact
the business of insurance, in the state of North Dakota or eligible to provide
insurance as an excess or surplus lines insurer in one or more states.
[Signature of authorized representative of insurer]
[Type name]
[Title], authorized representative of [name of
insurer]
[Address of representative]
10. A letter of credit, as
specified in subsection 8 of section
33.1-24-02-40, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
IRREVOCABLE STANDBY LETTER OF CREDIT
[Name and Address of Issuing Institution]
North Dakota Department of Environmental Quality
Dear Sir or Madam:
We hereby establish our Irrevocable Standby Letter of Credit
No.____ in the favor of ["any and all third-party liability claimants" or
insert name of TRUSTEE of the standby trust fund], at the request and for the
account of [owner's or operator's name and address] for third-party liability
awards or settlements up to [in words] United States dollars $ _______ per
occurrence and the annual aggregate amount of [in words] United States dollars
$ _______ , for sudden accidental occurrences and/or for third-party liability
awards or settlements up to the amount of [in words] United States dollars $
_______ per occurrence, and the annual aggregate amount of [in words] United
States dollars $ ______ , for nonsudden accidental occurrences available upon
presentation of a sight draft bearing reference to this letter of credit No.
______ , and [insert the following language if the letter of credit is being
used without a standby trust fund]:
(1) a signed certificate reading as follows:
CERTIFICATE OF VALID CLAIM
The undersigned, as parties [insert principal] and [insert
name and address of third-party claimant(s)], hereby certify that the claim of
bodily injury and/or property damage caused by a [sudden or nonsudden]
accidental occurrence arising from operations of [principal's] facility should
be paid in the amount of $[ ___ ]. We hereby certify that the claim does not
apply to any of the following:
(a)
Bodily injury or property damage for which [insert principal] is obligated to
pay damages by reason of the assumption of liability in a contract or
agreement. This exclusion does not apply to liability for damages that [insert
principal] would be obligated to pay in the absence of the contract or
agreement.
(b) Any obligation of
[insert principal] under a workers' compensation, disability benefits, or
unemployment compensation law or any similar law.
(c) Bodily injury to:
(1) An employee of [insert principal] arising
from, and in the course of, employment by [insert principal]; or
(2) The spouse, child, parent, brother, or
sister of that employee as a consequence of, or arising from, and in the course
of employment by [insert principal].
This exclusion applies:
(A) Whether [insert principal] may be liable
as an employer or in any other capacity; and
(B) To any obligation to share damages with
or repay another person who must pay damages because of the injury to persons
identified in paragraphs 1 and 2.
(d) Bodily injury or property damage arising
out of the ownership, maintenance, use, or entrustment to others of any
aircraft, motor vehicle, or watercraft.
(e) Property damage to:
(1) Any property owned, rented, or occupied
by [insert principal];
(2) Premises
that are sold, given away, or abandoned by [insert principal] if the property
damage arises out of any part of those premises;
(3) Property loaned to [insert
principal];
(4) Personal property
in the care, custody, or control of [insert principal]; or
(5) That particular part of real property on
which [insert principal] or any contractors or subcontractors working directly
or indirectly on behalf of [insert principal] are performing operations, if the
property damage arises out of these operations.
[Signatures]
GRANTOR
[Signatures]
Claimant(s)
or (2) a valid final court order establishing a judgment
against the GRANTOR for bodily injury or property damage caused by sudden or
nonsudden accidental occurrences arising from the operation of the GRANTOR's
facility or group of facilities.]
This letter of credit is effective as of [date] and shall
expire on [date at least one year later], but such expiration date shall be
automatically extended for a period of [at least one year] on [date] and on
each successive expiration date, unless, at least one hundred twenty days
before the current expiration date, we notify you, the
DEPARTMENT, and [owner's or operator's name] by certified
mail that we have decided not to extend this letter of credit beyond the
current expiration date.
Whenever this letter of credit is drawn on under and in
compliance with the terms of this credit, we shall duly honor such draft upon
presentation to us.
[Insert the following language if a standby trust fund is not
being used: "In the event that this letter of credit is used in combination
with another mechanism for liability coverage, this letter of credit shall be
considered [insert "primary" or "excess"] coverage.
We certify that the wording of this letter of credit is
identical to the wording specified in subsection 10 of section 33.1-24-02-42 as
such regulations were constituted on the date shown immediately below.
[Signature(s) and
title(s) of official(s) of issuing institution]
[Date].
This credit is subject to [insert "the most recent edition of
the Uniform Customs and Practice for Documentary Credits published and
copyrighted by the International Chamber of Commerce" or "the Uniform
Commercial Code"].
11. A surety bond, as specified in subsection
9 of section
33.1-24-02-40, must be worded as
follows: except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
PAYMENT BOND
Surety Bond No. [Insert number]
Parties [insert name and address of owner or operator],
principal, incorporated in [insert state of incorporation] of [insert city and
state of principal place of business] and [insert name and address of surety
company(ies)], surety company(ies), of [insert surety(ies) place of
business].
Identification number (if any issued), name, and address for
each facility guaranteed by this bond:
| Sudden Accidental Occurrences |
Nonsudden Accidental Occurrences |
| Penal sum per occurrence |
[insert amount] |
[insert amount] |
| Annual aggregate |
[insert amount] |
[insert amount] |
Purpose: this is an AGREEMENT between the surety(ies) and the
principal under which the surety(ies), its(their) successors and assignees,
agree to be responsible for the payment of claims against the principal for
bodily injury and/or property damage to third parties caused by ["sudden"
and/or "nonsudden"] accidental occurrences arising from operations of the
facility or group of facilities in the sums prescribed herein; subject to the
governing provisions and the following conditions.
Governing Provisions
(1) Section 3004 of the Resource Conservation
and Recovery Act of 1976, as amended.
(2) Rules and regulations of the United
States environmental protection agency (EPA), particularly 40 CFR parts 264,
265, and Subpart H of 40 CFR part 261 (if applicable).
(3) Rules and regulations of the North Dakota
Department of Environmental Quality (DEPARTMENT), particularly sections
33.1-24-05-01 through
33.1-24-05-190,
33.1-24-05-300 through
33.1-24-05-524,
33.1-24-05-550 through
33.1-24-05-559,
33.1-24-05-800 through
33.1-24-05-819, subsection 5 of
section 33.1-24-06-16, and sections
33.1-24-02-33 through
33.1-24-02-42 of the North Dakota Administrative Code (if
applicable).
Conditions
(1) The
principal is subject to the applicable governing provisions that require the
principal to have and maintain liability coverage for bodily injury and
property damage to third parties caused by ["sudden" and/or "nonsudden"]
accidental occurrences arising from operations of the facility or group of
facilities. Such obligation does not apply to any of the following:
(a) Bodily injury or property damage for
which [insert principal] is obligated to pay damages by reason of the
assumption of liability in a contract or agreement. This exclusion does not
apply to liability for damages that [insert principal] would be obligated to
pay in the absence of the contract or agreement.
(b) Any obligation of [insert principal]
under a workers' compensation, disability benefits, or unemployment
compensation law or similar law.
(c) Bodily injury to:
(1) An employee of [insert principal] arising
from, and in the course of, employment by [insert principal]; or
(2) The spouse, child, parent, brother, or
sister of that employee as a consequence of, or arising from, and in the course
of employment by [insert principal]. This exclusion applies:
(A) Whether [insert principal] may be liable
as an employer or in any other capacity; and
(B) To any obligation to share damages with
or repay another person who must pay damages because of the injury to persons
identified in paragraphs (1) and (2).
(d) Bodily injury or property damage arising
out of the ownership, maintenance, use, or entrustment to others of any
aircraft, motor vehicle, or watercraft.
(e) Property damage to:
(1) Any property owned, rented, or occupied
by [insert principal];
(2) Premises
that are sold, given away, or abandoned by [insert principal] if the property
damage arises out of any part of those premises;
(3) Property loaned to [insert
principal];
(4) Personal property
in the care, custody, or control of [insert principal]; or
(5) That particular part of real property on
which [insert principal] or any contractors or subcontractors working directly
or indirectly on behalf of [insert principal] are performing operations, if the
property damage arises out of these operations.
(2) This bond assures that the principal will
satisfy valid third-party liability claims, as described in condition
1.
(3) If the principal fails to
satisfy a valid third-party liability claim, as described above, the
surety(ies) becomes liable on this bond obligation.
(4) The surety(ies) shall satisfy a
third-party liability claim only upon the receipt of one of the following
documents:
(a) Certification from the
principal and the third-party claimant(s) that the liability claim should be
paid. The certification must be worded as follows, except that instructions in
brackets are to be replaced with the relevant information and the brackets
deleted:
CERTIFICATION OF VALID CLAIM
The undersigned, as parties [insert name of principal] and
[insert name and address of third-party claimant(s)], hereby certify that the
claim of bodily injury and/or property damage caused by a [sudden or nonsudden]
accidental occurrence arising from operating [principal's] facility should be
paid in the amount of $[ _____ ].
[Signature]
Principal
[Notary] Date
[Signature(s)]
Claimant(s)
[Notary] Date
(b) A valid final court order establishing a
judgment against the principal for bodily injury or property damage caused by
sudden or nonsudden accidental occurrences arising from the operation of the
principal's facility or group of facilities.
(5) In the event of combination of this bond
with another mechanism for liability coverage, this bond will be considered
[insert "primary" or "excess"] coverage.
(6) The liability of the surety(ies) shall
not be discharged by any payment or succession of payments hereunder, unless
and until such payment or payments shall amount in the aggregate to the penal
sum of the bond. In no event shall the obligation of the surety(ies) hereunder
exceed the amount of said annual aggregate penal sum, provided that the
surety(ies) furnish(es) notice to the DEPARTMENT forthwith of all claims filed
and payments made by the surety(ies) under this bond.
(7) The surety(ies) may cancel the bond by
sending notice of cancellation by certified mail to the principal and the
DEPARTMENT provided, however, the cancellation shall not occur during the one
hundred twenty days beginning on the date of receipt of the notice of
cancellation by the principal and the DEPARTMENT, as evidenced by the return
receipt.
(8) The principal may
terminate this bond by sending written notice to the surety(ies) and to the
DEPARTMENT.
(9) The surety(ies)
hereby waive(s) notification of amendments to applicable laws, statutes, rules,
and regulations and agree(s) that no such amendment shall in any way alleviate
its (their) obligation on this bond.
(10) This bond is effective from [insert
date] (12:01 a.m., standard time, at the address of the principal as stated
herein) and shall continue in force until terminated as described above.
In Witness Whereof, the principal and surety(ies) have
executed this bond and have affixed their seals on the date set forth
above.
The persons whose signatures appear below hereby certify that
they are authorized to execute this surety bond on behalf of the principal and
surety(ies) and that the wording of this surety bond is identical to the
wording specified in subsection 11 of section 33.1-24-02-42, as such
regulations were constituted on the date this bond was executed.
PRINCIPAL
[Signature(s)]
[Name(s)]
[Title(s)]
[Corporate seal]
CORPORATE SURETY(IES)
[Name and address]
State of incorporation: ________________
Liability limit: $ _____________________
[Signature(s)]
[Name(s) and title(s)]
[Corporate seal]
[For every co-surety, provide signature(s), corporate seal,
and other information in the same manner as for surety above.]
Bond premium: $ ___________________
12. Trust agreement.
a. A trust agreement, as specified in
subsection 10 of section
33.1-24-02-40, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
TRUST AGREEMENT
TRUST AGREEMENT, the "AGREEMENT," entered into as of [date]
by and between [name of the owner or operator] a [name of state] [insert
"corporation", "partnership", "association", or "proprietorship"], the
"GRANTOR", and [name of corporate TRUSTEE], [insert, "incorporated in the state
of __________ " or "a national bank"], the "TRUSTEE".
Whereas, the DEPARTMENT has established certain regulations
applicable to the GRANTOR, requiring that an owner or operator must demonstrate
financial responsibility for bodily injury and property damage to third parties
caused by sudden accidental and/or nonsudden accidental occurrences arising
from operations of the facility or group of facilities.
Whereas, the GRANTOR has elected to establish a trust to
assure all or part of such financial responsibility for the facilities
identified herein.
Whereas, the GRANTOR, acting through its duly authorized
officers, has selected the TRUSTEE to be the TRUSTEE under this AGREEMENT, and
the TRUSTEE is willing to act as TRUSTEE.
Now, therefore, the GRANTOR and the TRUSTEE agree as
follows:
Section 1.
Definitions. As used in this AGREEMENT:
(a) The term "GRANTOR" means the owner or
operator who enters into this AGREEMENT and any successors or assigns of the
GRANTOR.
(b) The term "TRUSTEE"
means the TRUSTEE who enters into this AGREEMENT and any successor
TRUSTEE.
Section 2.
Identification of Facilities. This AGREEMENT pertains to the
facilities identified on attached schedule A [on schedule A, for each facility
list the identification number (if any issued), name, and address of the
facility(ies) and the amount of liability coverage, or portions thereof, if
more than one instrument affords combined coverage as demonstrated by this
AGREEMENT].
Section 3.
Establishment of FUND. The GRANTOR and the TRUSTEE hereby establish a
trust fund, hereinafter the "FUND", for the benefit of any and all third
parties injured or damaged by [sudden or nonsudden, or both] accidental
occurrences arising from operation of the facility(ies) covered by this
guarantee, in the amount of $ __________ [up to $1 million] per occurrence and
$ __________ [up to $2 million] annual aggregate for sudden accidental
occurrences and $ __________ [up to $3 million] per occurrence and $ __________
[up to $6 million] annual aggregate for nonsudden occurrences, except that the
FUND is not established for the benefit of third parties for the following:
(a) Bodily injury or property damage for
which [insert GRANTOR] is obligated to pay damages by reason of the assumption
of liability in a contract or agreement. This exclusion does not apply to
liability for damages that [insert GRANTOR] would be obligated to pay in the
absence of the contract or agreement.
(b) Any obligation of [insert GRANTOR] under
a workers' compensation, disability benefits, or unemployment compensation law
or any similar law.
(c) Bodily
injury to:
(1) An employee of [insert
GRANTOR] arising from, and in the course of, employment by [insert GRANTOR];
or
(2) The spouse, child, parent,
brother, or sister of that employee as a consequence of, or arising from, and
in the course of employment by [insert GRANTOR].
This exclusion applies:
(A) Whether [insert GRANTOR] may be liable as
an employer or in any other capacity; and
(B) To any obligation to share damages with
or repay another person who must pay damages because of the injury to persons
identified in paragraphs (1) and (2).
(d) Bodily injury or property damage arising
out of the ownership, maintenance, use, or entrustment to others of any
aircraft, motor vehicle, or watercraft.
(e) Property damage to:
(1) Any property owned, rented, or occupied
by [insert GRANTOR];
(2) Premises
that are sold, given away, or abandoned by [insert GRANTOR] if the property
damage arises out of any part of those premises;
(3) Property loaned to [insert
GRANTOR];
(4) Personal property in
the care, custody, or control of [insert GRANTOR]; or
(5) That particular part of real property on
which [insert GRANTOR] or any contractors or subcontractors working directly or
indirectly on behalf of [insert GRANTOR] are performing operations, if the
property damage arises out of these operations.
In the event of combination with another mechanism for
liability coverage, the FUND shall be considered [insert "primary" or "excess"]
coverage.
The FUND is established initially as consisting of the
property, which is acceptable to the TRUSTEE, described in schedule B attached
hereto. Such property and any other property subsequently transferred to the
TRUSTEE is referred to as the FUND, together with all earnings and profits
thereon, less any payments or distributions made by the TRUSTEE pursuant to
this AGREEMENT. The FUND shall be held by the TRUSTEE, IN TRUST, as hereinafter
provided. The TRUSTEE shall not be responsible nor shall it undertake any
responsibility for the amount or adequacy of, nor any duty to collect from the
GRANTOR, any payments necessary to discharge any liabilities of the GRANTOR
established by the DEPARTMENT.
Section 4.
Payment for Bodily Injury or
Property Damage. The TRUSTEE shall satisfy a third-party liability claim
by making payments from the FUND only upon receipt of one of the following
documents:
(a) Certification from the GRANTOR
and the third-party claimant(s) that the liability claim should be paid. The
certification must be worded as follows, except that instructions in brackets
are to be replaced with the relevant information and the brackets deleted:
CERTIFICATION OF VALID CLAIM
The undersigned, as parties [insert GRANTOR] and [insert name
and address of third-party claimant(s)], hereby certify that the claim of
bodily injury and/or property damage caused by a [sudden or nonsudden]
accidental occurrence arising from operating [GRANTOR's] facility or group of
facilities should be paid in the amount of $[ __________ ].
[Signatures]
GRANTOR
[Signatures]
Claimant(s)
(b) A valid final court order establishing a
judgment against the GRANTOR for bodily injury or property damage caused by
sudden or nonsudden accidental occurrences arising from the operation of the
GRANTOR's facility or group of facilities.
Section 5.
Payments Comprising the
FUND. Payments made to the TRUSTEE for the FUND shall consist of cash or
securities acceptable to the TRUSTEE.
Section
6.
TRUSTEE Management. The TRUSTEE shall invest and
reinvest the principal and income, in accordance with general investment
policies and guidelines which the GRANTOR may communicate in writing to the
TRUSTEE from time to time, subject, however, to the provisions of this section.
In investing, reinvesting, exchanging, selling, and managing the FUND, the
TRUSTEE shall discharge the TRUSTEE's duties with respect to the trust fund
solely in the interest of the beneficiary and with the care, skill, prudence,
and diligence under the circumstance then prevailing which persons of prudence,
acting in a like capacity and familiar with such matters, would use in the
conduct of an enterprise of a like character and with like aims; except that:
(i) Securities or other obligations of the
GRANTOR, or any other owner or operator of the facilities, or any of their
affiliates as defined in the Investment Company Act of 1940, as amended,
15 U.S.C.
80a-2(a), shall not be
acquired or held unless they are securities or other obligations of the federal
or a state government;
(ii) The
TRUSTEE is authorized to invest the FUND in time or demand deposits of the
TRUSTEE, to the extent insured by an agency of the federal or state government;
and
(iii) The TRUSTEE is authorized
to hold cash awaiting investment or distribution uninvested for a reasonable
time and without liability for the payment of interest thereon.
Section 7.
Commingling and
Investment. The TRUSTEE is expressly authorized in its discretion:
(a) To transfer from time to time any or all
of the assets of the FUND to any common commingled, or collective trust fund
created by the TRUSTEE in which the FUND is eligible to participate, subject to
all of the provisions thereof, to be commingled with the assets of other trusts
participating therein; and
(b) To
purchase shares in any investment company registered under the Investment
Company Act of 1940,
15 U.S.C.
80a-1 et seq., including one which may be
created, managed, underwritten, or to which investment advice is rendered or
the shares of which are sold by the TRUSTEE. The TRUSTEE may vote such shares
in its discretion.
Section
8.
Express Powers of TRUSTEE. Without in any way
limiting the powers and discretions conferred upon the TRUSTEE by the other
provisions of this AGREEMENT or by law, the TRUSTEE is expressly authorized and
empowered:
(a) To sell, exchange, convey,
transfer, or otherwise dispose of any property held by it, by public or private
sale. No person dealing with the TRUSTEE shall be bound to see to the
application of the purchase money or to inquire into the validity or expediency
of any such sale or other disposition;
(b) To make, execute, acknowledge, and
deliver any and all documents of transfer and conveyance and any and all other
instruments that may be necessary or appropriate to carry out the powers herein
granted;
(c) To register any
securities held in the FUND in its own name or in the name of a nominee and to
hold any security in bearer form or in book entry, or to combine certificates
representing such securities with certificates of the same issue held by the
TRUSTEE in other fiduciary capacities, or to deposit or arrange for the deposit
of such securities in a qualified central depository even though, when so
deposited, such securities may be merged and held in bulk in the name of the
nominee of such depository with other securities deposited therein by another
person, or to deposit or arrange for the deposit of any securities issued by
the United States government, or any agency or instrumentality thereof, with a
federal reserve bank, but the books and records of the TRUSTEE shall at all
times show that all such securities are part of the FUND;
(d) To deposit any cash in the FUND in
interest-bearing accounts maintained or savings certificates issued by the
TRUSTEE, in its separate corporate capacity, or in any other banking
institution affiliated with the TRUSTEE, to the extent insured by an agency of
the federal or state government; and
(e) To compromise or otherwise adjust all
claims in favor of or against the FUND.
Section 9.
Taxes and Expenses.
All taxes of any kind that may be assessed or levied against or in
respect of the FUND and all brokerage commissions incurred by the FUND shall be
paid from the FUND. All other expenses incurred by the TRUSTEE in connection
with the administration of this trust, including fees for legal services
rendered to the TRUSTEE, the compensation of the TRUSTEE to the extent not paid
directly by the GRANTOR, and all other proper charges and disbursements of the
TRUSTEE shall be paid from the FUND.
Section
10.
Annual Valuations. The TRUSTEE shall annually, at
least thirty days prior to the anniversary date of establishment of the FUND,
furnish to the GRANTOR and to the DEPARTMENT a statement confirming the value
of the trust. Any securities in the FUND shall be valued at market value as of
no more than sixty days prior to the anniversary date of establishment of the
FUND. The failure of the GRANTOR to object in writing to the TRUSTEE within
ninety days after the statement has been furnished to the GRANTOR and the
DEPARTMENT shall constitute a conclusively binding assent by the GRANTOR
barring the GRANTOR from asserting any claim or liability against the TRUSTEE
with respect to matters disclosed in the statement.
Section 11.
Advice of Counsel.
The TRUSTEE may from time to time consult with counsel, who may be counsel to
the GRANTOR with respect to any question arising as to the construction of this
AGREEMENT or any action to be taken hereunder. The TRUSTEE shall be fully
protected, to the extent permitted by law, in acting upon the advice of
counsel.
Section 12.
TRUSTEE
Compensation. The TRUSTEE shall be entitled to reasonable compensation
for its services as agreed upon in writing from time to time with the
GRANTOR.
Section 13.
Successor TRUSTEE. The TRUSTEE may resign or the GRANTOR may
replace the TRUSTEE, but such resignation or replacement shall not be effective
until the GRANTOR has appointed a successor TRUSTEE and this successor accepts
the appointment. The successor TRUSTEE shall have the same powers and duties as
those conferred upon the TRUSTEE hereunder. Upon the successor TRUSTEE's
acceptance of the appointment, the TRUSTEE shall assign, transfer, and pay over
to the successor TRUSTEE the funds and properties then constituting the FUND.
If for any reason the GRANTOR cannot or does not act in the event of the
resignation of the TRUSTEE, the TRUSTEE may apply to a court of competent
jurisdiction for the appointment of a successor TRUSTEE or for instructions.
The successor TRUSTEE shall specify the date on which it assumes administration
of the trust in a writing sent to the GRANTOR, the DEPARTMENT, and the present
TRUSTEE by certified mail ten days before such change becomes effective. Any
expenses incurred by the TRUSTEE as a result of any of the acts contemplated by
this section shall be paid as provided in Section 9.
Section 14.
Instructions to the
TRUSTEE. All orders, requests, and instructions by the GRANTOR to the
TRUSTEE shall be in writing, signed by such persons as are designated in the
attached exhibit A or such other designees as the GRANTOR may designate by
amendments to exhibit A. The TRUSTEE shall be fully protected in acting without
inquiry in accordance with the GRANTOR's orders, requests, and instructions.
All orders, requests, and instructions by the DEPARTMENT to the TRUSTEE shall
be in writing, signed by the DEPARTMENT, or its designees, and the TRUSTEE
shall act and shall be fully protected in acting in accordance with such
orders, requests, and instructions. The TRUSTEE shall have the right to assume,
in the absence of written notice to the contrary, that no event constituting a
change or a termination of the authority of any person to act on behalf of the
GRANTOR or DEPARTMENT hereunder has occurred. The TRUSTEE shall have no duty to
act in the absence of such orders, requests, and instructions from the GRANTOR
and/or the DEPARTMENT, except as provided for herein.
Section 15.
Notice of
Nonpayment. If a payment for bodily injury or property damage is made
under Section 4 of this trust, the TRUSTEE shall notify the GRANTOR of such
payment and the amount(s) thereof within five working days. The GRANTOR shall,
on or before the anniversary date of the establishment of the FUND following
such notice, either make payments to the TRUSTEE in amounts sufficient to cause
the trust to return to its value immediately prior to the payment of claims
under Section 4, or shall provide written proof to the TRUSTEE that other
financial assurance for liability coverage has been obtained equaling the
amount necessary to return the trust to its value prior to the payment of
claims. If the GRANTOR does not either make payments to the TRUSTEE or provide
the TRUSTEE with such proof, the TRUSTEE shall within ten working days after
the anniversary date of the establishment of the FUND provide a written notice
of nonpayment to the DEPARTMENT.
Section
16.
Amendment of AGREEMENT. This AGREEMENT may be
Adopted by an instrument in writing executed by the GRANTOR, the TRUSTEE, and
the DEPARTMENT, or by the TRUSTEE and the DEPARTMENT if the GRANTOR ceases to
exist.
Section 17.
Irrevocability and Termination. Subject to the right of the
parties to amend this AGREEMENT as provided in Section 16, this trust shall be
irrevocable and shall continue until terminated at the written AGREEMENT of the
GRANTOR, the TRUSTEE, and the DEPARTMENT, or by the TRUSTEE, and the
DEPARTMENT, if the GRANTOR ceases to exist. Upon termination of the trust, all
remaining trust property, less final trust administration expenses, shall be
delivered to the GRANTOR. The DEPARTMENT will agree to termination of the trust
when the owner or operator substitutes alternate financial assurance as
specified in this section.
Section
18.
Immunity and Indemnification. The TRUSTEE shall
not incur personal liability of any nature in connection with any act or
omission, made in good faith, in the administration of this trust, or in
carrying out any directions by the GRANTOR or the DEPARTMENT issued in
accordance with this AGREEMENT. The TRUSTEE shall be indemnified and saved
harmless by the GRANTOR or from the trust fund, or both, from and against any
personal liability to which the TRUSTEE may be subjected by reason of any act
or conduct in its official capacity, including all expenses reasonably incurred
in its defense in the event the GRANTOR fails to provide such
defense.
Section 19.
Choice
of Law. This AGREEMENT shall be administered, construed, and enforced
according to the laws of the state of North Dakota.
Section 20.
Interpretation. As
used in this AGREEMENT, words in the singular include the plural and words in
the plural include the singular. The descriptive headings for each section of
this AGREEMENT shall not affect the interpretation or the legal efficacy of
this AGREEMENT.
In Witness Whereof the parties have caused this AGREEMENT to
be executed by their respective officers duly authorized and their corporate
seals to be hereunto affixed and attested as of the date first above written.
The parties below certify that the wording of this AGREEMENT is identical to
the wording specified in subsection 12 of section 33.1-24-02-42, as such
regulations were constituted on the date first above written.
[Signature of GRANTOR]
[Title]
Attest:
[Title]
[Seal]
[Signature of TRUSTEE]
Attest:
[Title]
[Seal]
b. The following is an example of the
certification of acknowledgment which must accompany the TRUST AGREEMENT for a
trust fund as specified in subsection 10 of section
33.1-24-02-40.
State of _____________________________
County of ____________________________
On this [date], before me personally came [owner or operator]
to me known, who, being by me duly sworn, did depose and say that she/he
resides at [address], that she/he is [title] of [corporation], the corporation
described in and which executed the above instrument; that she/he knows the
seal of said corporation; that the seal affixed to such instrument is such
corporate seal; that it was so affixed by order of the board of directors of
said corporation, and that she/he signed her/his name thereto by like
order.
[Signature of notary public]
13. Standby trust agreement.
a. A standby trust agreement, as specified in
subsection 8 of section
33.1-24-02-40, must be worded as
follows, except that instructions in brackets are to be replaced with the
relevant information and the brackets deleted:
STANDBY TRUST AGREEMENT
TRUST AGREEMENT, the "AGREEMENT", entered into as of [date]
by and between [name of the owner or operator] a [name of a state] [insert
"corporation", "partnership", "association", or "proprietorship"], the
"GRANTOR", and [name of corporate TRUSTEE], [insert, "incorporated in the state
of _______ " or "a national bank"], the "TRUSTEE."
Whereas the DEPARTMENT has established certain regulations
applicable to the GRANTOR, requiring that an owner or operator must demonstrate
financial responsibility for bodily injury and property damage to third parties
caused by sudden accidental and/or nonsudden accidental occurrences arising
from operations of the facility or group of facilities.
Whereas, the GRANTOR has elected to establish a standby trust
into which the proceeds from a letter of credit may be deposited to assure all
or part of such financial responsibility for the facilities identified
herein.
Whereas, the GRANTOR, acting through its duly authorized
officers, has selected the TRUSTEE to be the TRUSTEE under this AGREEMENT, and
the TRUSTEE is willing to act as TRUSTEE.
Now, therefore, the GRANTOR and the TRUSTEE agree as
follows:
Section 1.
Definitions. As used in this AGREEMENT:
(a) The term "GRANTOR" means the owner or
operator who enters into this AGREEMENT and any successors or assigns of the
GRANTOR.
(b) The term "TRUSTEE"
means the TRUSTEE who enters into this AGREEMENT and any successor
TRUSTEE.
Section 2.
Identification of Facilities. This AGREEMENT pertains to the
facilities identified on attached schedule A [on schedule A, for each facility
list the identification number (if any issued), name, and address of the
facility(ies) and the amount of liability coverage, or portions thereof, if
more than one instrument affords combined coverage as demonstrated by this
AGREEMENT].
Section 3.
Establishment of FUND. The GRANTOR and the TRUSTEE hereby
establish a standby trust fund, hereafter the "FUND", for the benefit of any
and all third parties injured or damaged by [sudden and/or nonsudden]
accidental occurrences arising from operation of the facility(ies) covered by
this guarantee, in the amounts of $ ______ [up to $1 million] per occurrence
and $ _______ [up to $2 million] annual aggregate for sudden accidental
occurrences and $ _________ [up to $3 million] per occurrence and $ ________
[up to $6 million] annual aggregate for nonsudden occurrences, except that the
FUND is not established for the benefit of third parties for the following:
(a) Bodily injury or property damage for
which [insert GRANTOR] is obligated to pay damages by reason of the assumption
of liability in a contract or agreement. This exclusion does not apply to
liability for damages that [insert GRANTOR] would be obligated to pay in the
absence of the contract or agreement.
(b) Any obligation of [insert GRANTOR] under
a workers' compensation, disability benefits, or unemployment compensation law,
or any similar law.
(c) Bodily
injury to:
(1) An employee of [insert
GRANTOR] arising from, and in the course of, employment by [insert GRANTOR];
or
(2) The spouse, child, parent,
brother, or sister of that employee as a consequence of, or arising from, and
in the course of employment by [insert GRANTOR].
This exclusion applies:
(A) Whether [insert GRANTOR] may be liable as
an employer or in any other capacity; and
(B) To any obligation to share damages with
or repay another person who must pay damages because of the injury to persons
identified in paragraphs (1) and (2).
(d) Bodily injury or property damage arising
out of the ownership, maintenance, use, or entrustment to others of any
aircraft, motor vehicle, or watercraft.
(e) Property damage to:
(1) Any property owned, rented, or occupied
by [insert GRANTOR];
(2) Premises
that are sold, given away, or abandoned by [insert GRANTOR] if the property
damage arises out of any part of those premises;
(3) Property loaned by [insert
GRANTOR];
(4) Personal property in
the care, custody, or control of [insert GRANTOR]; or
(5) That particular part of real property on
which [insert GRANTOR] or any contractors or subcontractors working directly or
indirectly on behalf of [insert GRANTOR] are performing operations, if the
property damage arises out of these operations.
In the event of combination with another mechanism for
liability coverage, the FUND shall be considered [insert "primary" or "excess"]
coverage.
The FUND is established initially as consisting of the
proceeds of the letter of credit deposited into the FUND. Such proceeds and any
other property subsequently transferred to the TRUSTEE is referred to as the
FUND, together with all earnings and profits thereon, less any payments or
distributions made by the TRUSTEE pursuant to this AGREEMENT. The FUND shall be
held by the TRUSTEE, IN TRUST, as hereinafter provided. The TRUSTEE shall not
be responsible nor shall it undertake any responsibility for the amount or
adequacy of, nor any duty to collect from the GRANTOR, any payments necessary
to discharge any liabilities of the GRANTOR established by the
DEPARTMENT.
Section 4.
Payment for Bodily Injury or
Property Damage. The TRUSTEE shall satisfy a third party liability claim
by drawing on the letter of credit described in schedule B and by making
payments from the FUND only upon receipt of one of the following documents:
(a) Certification from the GRANTOR and the
third party claimant(s) that the liability claim should be paid. The
certification must be worded as follows, except that instructions in brackets
are to be replaced with the relevant information and the brackets deleted:
CERTIFICATION OF VALID CLAIM
The undersigned, as parties [insert GRANTOR] and [insert name
and address of third-party claimant(s)], hereby certify that the claim of
bodily injury and/or property damage caused by a [sudden or nonsudden]
accidental occurrence arising from operating [GRANTOR's] facility should be
paid in the amount of $[___].
[Signature]
GRANTOR
[Signatures]
Claimant(s)
(b) A valid final court order establishing a
judgment against the GRANTOR for bodily injury or property damage caused by
sudden or nonsudden accidental occurrences arising from the operation of the
GRANTOR's facility or group of facilities.
Section 5.
Payments Comprising the
FUND. Payments made to the TRUSTEE for the FUND shall consist of the
proceeds from the letter of credit drawn upon by the TRUSTEE in accordance with
the requirements of subsection 11 of section 33.1-24-02-42 and Section 4 of
this AGREEMENT.
Section 6.
TRUSTEE Management. The TRUSTEE shall invest and reinvest the
principal and income, in accordance with general investment policies and
guidelines which the GRANTOR may communicate in writing to the TRUSTEE from
time to time, subject, however, to the provisions of this section. In
investing, reinvesting, exchanging, selling, and managing the FUND, the TRUSTEE
shall discharge the TRUSTEE's duties with respect to the trust FUND solely in
the interest of the beneficiary and with the care, skill, prudence, and
diligence under the circumstances then prevailing which persons of prudence,
acting in a like capacity and familiar with such matters, would use in the
conduct of an enterprise of a like character and with like aims; except that:
(i) Securities or other obligations of the
GRANTOR, or any other owner or operator of the facilities, or any of their
affiliates as defined in the Investment Company Act of 1940, as amended,
15 U.S.C.
80a-2(a), shall not be
acquired or held, unless they are securities or other obligations of the
federal or a state government;
(ii)
The TRUSTEE is authorized to invest the FUND in time or demand deposits of the
TRUSTEE, to the extent insured by an agency of the federal or a state
government; and
(iii) The TRUSTEE
is authorized to hold cash awaiting investment or distribution uninvested for a
reasonable time and without liability for the payment of interest
thereon.
Section 7.
Commingling and Investment. The TRUSTEE is expressly authorized in
its discretion:
(a) To transfer from time to
time any or all of the assets of the FUND to any common, commingled, or
collective trust fund created by the TRUSTEE in which the FUND is eligible to
participate, subject to all of the provisions thereof, to be commingled with
the assets of other trusts participating therein; and
(b) To purchase shares in any investment
company registered under the Investment Company Act of 1940,
15 U.S.C.
80a-1 et seq., including one which may be
created, managed, underwritten, or to which investment advice is rendered or
the shares of which are sold by the TRUSTEE. The TRUSTEE may vote such shares
in its discretion.
Section
8.
Express Powers of TRUSTEE. Without in any way
limiting the powers and discretions conferred upon the TRUSTEE by other
provisions of this AGREEMENT or by law, the TRUSTEE is expressly authorized and
empowered:
(a) To sell, exchange, convey,
transfer, or otherwise dispose of any property held by it, by public or private
sale. No person dealing with the TRUSTEE shall be bound to see to the
application of the purchase money or to inquire into the validity or expediency
of any such sale or other disposition;
(b) To make, execute, acknowledge, and
deliver any and all documents of transfer and conveyance and any and all other
instruments that may be necessary or appropriate to carry out the powers herein
granted;
(c) To register any
securities held in the FUND in its own name or in the name of a nominee and to
hold any security in bearer form or in book entry, or to combine certificates
representing such securities with certificates of the same issue held by the
TRUSTEE in other fiduciary capacities, or to deposit or arrange for the deposit
of such securities in a qualified central depositary even though, when so
deposited, such securities may be merged and held in bulk in the name of the
nominee of such depositary with other securities deposited therein by another
person, or to deposit or arrange for the deposit of any securities issued by
the United States government, or any agency or instrumentality thereof, with a
federal reserve bank, but the books and records of the TRUSTEE shall at all
times show that all such securities are part of the FUND;
(d) To deposit any cash in the FUND in
interest-bearing accounts maintained or savings certificates issued by the
TRUSTEE, in its separate corporate capacity, or in any other banking
institution affiliated with the TRUSTEE, to the extent insured by an agency of
the federal or state government; and
(e) To compromise or otherwise adjust all
claims in favor of or against the FUND.
Section 9.
Taxes and Expenses.
All taxes of any kind that may be assessed or levied against or in
respect of the FUND and all brokerage commissions incurred by the FUND shall be
paid from the FUND. All other expenses incurred by the TRUSTEE in connection
with the administration of this trust, including fees for legal services
rendered to the TRUSTEE, the compensation of the TRUSTEE to the extent not paid
directly by the GRANTOR, and all other proper charges and disbursements to the
TRUSTEE shall be paid from the FUND.
Section
10.
Advice of Counsel. The TRUSTEE may from time to
time consult with counsel, who may be counsel to the GRANTOR, with respect to
any question arising as to the construction of this AGREEMENT or any action to
be taken hereunder. The TRUSTEE shall be fully protected, to the extent
permitted by law, in acting upon the advice of counsel.
Section 11.
TRUSTEE Compensation.
The TRUSTEE shall be entitled to reasonable compensation for its
services as agreed upon in writing from time to time with the
GRANTOR.
Section 12.
Successor TRUSTEE. The TRUSTEE may resign or the GRANTOR may
replace the TRUSTEE, but such resignation or replacement shall not be effective
until the GRANTOR has appointed a successor TRUSTEE and this successor accepts
the appointment. The successor TRUSTEE shall have the same powers and duties as
those conferred upon the TRUSTEE hereunder. Upon the successor TRUSTEE's
acceptance of the appointment, the TRUSTEE shall assign, transfer, and pay over
to the successor TRUSTEE the funds and properties then constituting the FUND.
If for any reason the GRANTOR cannot or does not act in the event of the
resignation of the TRUSTEE, the TRUSTEE may apply to a court of competent
jurisdiction for the appointment of a successor TRUSTEE or for instructions.
The successor TRUSTEE shall specify the date on which it assumes administration
of the trust in a writing sent to the GRANTOR, the DEPARTMENT and the present
TRUSTEE by certified mail ten days before such change becomes effective. Any
expenses incurred by the TRUSTEE as a result of any of the acts contemplated by
this section shall be paid as provided in Section 9.
Section 13.
Instructions to the
TRUSTEE. All orders, requests, certifications of valid claims, and
instructions to the TRUSTEE shall be in writing, signed by such persons as are
designated in the attached exhibit A or such other designees as the GRANTOR may
designate by amendments to exhibit A. The TRUSTEE shall be fully protected in
acting without inquiry in accordance with the GRANTOR's orders, requests, and
instructions. The TRUSTEE shall have the right to assume, in the absence of
written notice to the contrary, that no event constituting a change or a
termination of the authority of any person to act on behalf of the GRANTOR or
the DEPARTMENT hereunder has occurred. The TRUSTEE shall have no duty to act in
the absence of such orders, requests, and instructions from the GRANTOR and/or
the DEPARTMENT, except as provided for herein.
Section 14.
Amendment of AGREEMENT.
This AGREEMENT may be Adopted by an instrument in writing executed by
the GRANTOR, the TRUSTEE, and the DEPARTMENT, or by the TRUSTEE and the
DEPARTMENT if the GRANTOR ceases to exist.
Section 15.
Irrevocability and
Termination. Subject to the right of the parties to amend this AGREEMENT
as provided in Section 14, this trust shall be irrevocable and shall continue
until terminated at the written AGREEMENT of the GRANTOR, the TRUSTEE, and the
DEPARTMENT, or by the TRUSTEE and the DEPARTMENT, if the GRANTOR ceases to
exist. Upon termination of the trust, all remaining trust property, less final
trust administration expenses, shall be paid to the GRANTOR. The DEPARTMENT
will agree to termination of the trust when the owner or operator substitutes
alternative financial assurance as specified in this section.
Section 16.
Immunity and
Indemnification. The TRUSTEE shall not incur personal liability of any
nature in connection with any act or omission, made in good faith, in the
administration of this trust, or in carrying out any directions by the GRANTOR
and the DEPARTMENT issued in accordance with this AGREEMENT. The TRUSTEE shall
be indemnified and saved harmless by the GRANTOR or from the trust fund, or
both, from and against any personal liability to which the TRUSTEE may be
subjected by reason of any act or conduct in its official capacity, including
all expenses reasonably incurred in its defense in the event the GRANTOR fails
to provide such defense.
Section
17.
Choice of Law. This AGREEMENT shall be
administered, construed, and enforced according to the laws of the state of
North Dakota.
Section 18.
Interpretation. As used in this AGREEMENT, words in the singular
include the plural and words in the plural include the singular. The
descriptive headings for each section of this AGREEMENT shall not affect the
interpretation of the legal efficacy of this AGREEMENT.
In Witness Whereof the parties have caused this AGREEMENT to
be executed by their respective officers duly authorized and their corporate
seals to be hereunto affixed and attested as of the date first above written.
The parties below certify that the wording of this AGREEMENT is identical to
the wording specified in subsection 13 of section 33.1-24-02-42 as such
regulations were constituted on the date first above written.
[Signature of GRANTOR]
[Title]
Attest:
[Title]
[Seal]
[Signature of TRUSTEE]
Attest:
[Title]
[Seal]
b. The following is an example of the
certification of acknowledgment which must accompany the TRUST AGREEMENT for a
standby trust fund as specified in subsection 8 of section
33.1-24-02-40.
State of _______________________
County of _______________________
On this [date], before me personally came [owner or operator]
to me known, who, being by me duly sworn, did depose and say that she/he
resides at [address], that she/he is [title] of [corporation], the corporation
described in and which executed the above instrument; that she/he knows the
seal of said corporation; that the seal affixed to such instrument is such
corporate seal; that it was so affixed by order of the board of directors of
said corporation, and that she/he signed her/his name thereto by like
order.
[Signature of notary public]
General Authority: NDCC 23.1-04-03; S.L. 2017,
ch. 199, § 1
Law Implemented: NDCC 23.1-04-03, 23.1-04-05;
S.L. 2017, ch. 199, § 19
