[Code of Federal Regulations]
[Title 7, Volume 7]
[Revised as of January 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR735.12]

[Page 221]
 
                          TITLE 7--AGRICULTURE
 
                            CHAPTER VII--FARM
                SERVICE AGENCY, DEPARTMENT OF AGRICULTURE
 
PART 735--COTTON WAREHOUSES--Table of Contents
 
Sec. 735.12  Amount of bond; additional amounts.

    (a) The amount of bond to be furnished by each warehouseman under 
the regulations in this part, shall be the rate of ten dollars ($10.00) 
per bale for the maximum number of bales that the warehouse accommodates 
when stored in the manner customary to the warehouse as determined by 
the Secretary, but not less than twenty thousand dollars ($20,000) nor 
more than two hundred fifty thousand dollars ($250,000); except as 
provided in paragraphs (b) and (c) of this section.
    (b) In case a warehouseman is licensed or applying for licenses to 
operate two or more warehouses in the same State, he may give a single 
bond meeting the requirements of the Act and the regulations in this 
part to cover all his warehouses within the State and shall be deemed to 
be one warehouse only for purposes of determining the amount of bond 
required under paragraph (a) of this section.
    (c) In case of a deficiency in net assets above the twenty-five 
thousand dollars ($25,000) minimum required by Sec. 735.5(d)(1), there 
shall be added to the amount of bond determined in accordance with 
paragraph (a) of this section an amount equal to such deficiency or a 
letter of credit in the amount of the deficiency issued to the Secretary 
for a period of not less than two years to coincide with the period of 
any deposit of obligations under 7 CFR 735.11(c). Any letter of credit 
must be clean, irrevocable, issued by a commercial bank payable to the 
Secretary by sight draft and insured as a deposit by the Federal Deposit 
Insurance Corporation.
    (d) If the Secretary, or his designated representative, finds that 
conditions exist which warrant requiring additional bond, there shall be 
added to the amount of bond as determined under the other provisions of 
this section, a further amount to meet such conditions.

[Amdt. 2, 53 FR 27150, July 19, 1988]

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