Irrevocable Standby Letter of Credit Form

IRREVOCABLE STANDBY LETTER OF CREDIT
LETTER OF CREDIT NO.:
EFFECTIVE DATE:
AMOUNT:
ISSUING INSTITUTION:
Name
Address
City State Zip Code
County
BENEFICIARY:
State of North Carolina
Department of Environmental Quality
1612 Mail Service Center
Raleigh, North Carolina 27699-1612
APPLICANT/OPERATOR:
Name
Address
City State Zip Code
County
Rev. February 2018 Page 1

Dear Sir or Madam:
(1) The APPLICANT/OPERATOR desires to engage in mining operations within the State of
North Carolina, under the provisions of the Mining Act of 1971, N.C. General Statute 74-46, et seq.,
and the administrative rules promulgated there under.
(2) N.C. General Statute �174-50 requires that operators engaged in mining shall first obtain
an operating permit from the N. C. Department of Environmental Quality ("DEQ") which covers the
affected land and which has not terminated, been revoked, been suspended for the period in
question, or otherwise become invalid. N.C. General Statute 074-54 requires that each applicant for
an operating permit, or for the renewal thereof, shall file with DEQ, and shall thereafter maintain in
force, a bond in favor of the State of North Carolina in an amount as prescribed by Title 15A N.C.
Administrative Code Subchapter 5B. 0003. N.C. General Statute 174-54 further provides that in lieu
of the surety bond, an applicant or operator may file with DEQ a cash deposit, negotiable securities,
or an assignment of a savings account in a North Carolina bank.
(3) Thus, this IRREVOCABLE STANDBY LETTER OF CREDIT is issued to DEQ, in lieu of
the surety bond required to be filed by the APPLICANT/OPERATOR, as provided by N.C. General
Statute 74-54.
(4) The undersigned hereby establishes its IRREVOCABLE STANDBY LETTER OF CREDIT
in favor of DEQ, for the account of:
(APPLICANT/OPERATOR)
for the amount of dollars and no
100's ($ ), available by DEQ's draft(s) drawn on sight.
(5) This IRREVOCABLE STANDBY LETTER OF CREDIT shall expire
on
(date at least one (1) year from effective date)
The expiration date shall be extended automatically for a period
of on and
(one year or more) (expiration date)
on each successive expiration date, unless, at least sixty (60) days prior to the expiration date, the
undersigned notifies DEQ and the OPERATOR by certified mail, return receipt requested that the
undersigned will not extend this letter of credit beyond the current expiration date. If the undersigned
Rev. February 2018 Page 2

notifies DEQ that this letter of credit will not be extended, any unused portion of the credit shall be
available upon presentation of DEQ's sight draft within sixty (60) days after DEQ's or the
OPERATOR'S receipt of such notification, whichever is later.
(6) This IRREVOCABLE STANDBY LETTER OF CREDIT is non-transferable.
(7) Draft(s) shall be marked "Drawn Under
Credit No. "
(Issuing Institution)
and shall include the following documentation:
(a) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"In accordance with N. C. Gen. Stat. 174-59, we have received a notice of forfeiture
of part or all of the Bond Amount. The amount of our drawing does not exceed the
amount of the forfeiture as set forth in such notice.";
-or-
(b) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"We have received from (Issuing
Institution)
written notice stating (1)that this IRREVOCABLE STANDBY LETTER OF CREDIT
has not been renewed; and, (2)that the amount of our drawing does not exceed the
Bond Amount, less any previous forfeitures thereunder, pursuant to notices received
in accordance with N.C. General Statute -174-59.";
-or-
(c) A signed certificate by DEQ, referring to the effective date and Number of this
IRREVOCABLE STANDBY LETTER OF CREDIT, and stating that:
"We have received from (Issuing
Institution)
written notice stating (1) that there exists an Event of Default under the Credit
Agreement (as defined in the IRREVOCABLE STANDBY LETTER OF CREDIT); (2)
that a drawing should be made under this IRREVOCABLE STANDBY LETTER OF
CREDIT; and, (3)that the amount of the drawing does not exceed the bond amount,
Rev. February 2018 Page 3

less any previous forfeitures there under, pursuant to notices received in
accordance with N.C. General Statute 1174-59."
(8) This IRREVOCABLE STANDBY LETTER OF CREDIT is subject to the Uniform Customs
and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce Publication
No. 600 and the laws of the State of North Carolina. In the event of any conflict, the laws of the State of
North Carolina will control.
(9) hereby agrees
(Issuing Institution)
with the drawers, endorsers, and bona fide holders that all drafts drawn under and in compliance with the
terms of this IRREVOCABLE STANDBY LETTER OF CREDIT will be duly honored upon presentation to
this bank/issuing institution.
Very truly yours,
(Issuing Institution)
BY:
TITLE:
DATE:
Sworn and subscribed to before me this
the day of 120
Notary Public
My Commission Expires: (Seal)
Date
"PLEASE MAIL THIS FORM TO:
LAND QUALITY SECTION, 1612 Mail Service Center, Raleigh, NC 27699-1612
Rev. February 2018 Page 4