Sec. 6. (a) Except as provided under sections 7 and 8 of this chapter, before operating a livestock dealer business, a person must execute and maintain a bond or bond equivalent that meets the requirements of this section.

(b) The form of the bond or bond equivalent shall be prescribed by the board and must meet the following minimum requirements:

(1) The instrument must be payable to the state of Indiana, as obligee, for any person who may be damaged as a result of a breach of the conditions of the instrument.

(2) The terms of the instrument must secure the performance of the licensee's obligations under this chapter. The instrument must specifically provide that the dealer will pay all legal claims that may accrue in favor of any seller of livestock in Indiana.

(3) The surety on any livestock dealer bond or bond equivalent must be a surety company authorized to do business in Indiana.

(4) The bond or bond equivalent is considered to be continuous unless otherwise specified. The instrument must contain a provision requiring that, before terminating the instrument, the terminating party must serve to the board either:

(A) written notice of termination at least thirty (30) days before the effective date of the termination; or

(B) notice of a valid replacement bond or bond equivalent that provides continuous coverage.

(c) The livestock dealer bond or bond equivalent required under this section must be an amount that is not less than the next highest multiple of five thousand dollars ($5,000) above the quotient of:

(1) the dollar amount of livestock transactions conducted by the license applicant during the preceding twelve (12) months, or in that part of the year in which the applicant did business; divided by

(2) the number of days on which business was conducted.

(d) The following apply to the calculation set forth in subsection (c):

(1) The number of days on which business was conducted in a year may not exceed one hundred thirty (130).

(2) The amount of the bond or bond equivalent may not be less than ten thousand dollars ($10,000), and when the requirements exceed fifty thousand dollars ($50,000) under the calculations as specified in subsection (c), the amount of the instrument need not exceed fifty thousand dollars ($50,000) plus ten percent (10%) of the excess raised to the next multiple of five thousand dollars ($5,000).

(e) If the gross amount of business transacted during a twelve (12) month period changes and warrants an increase in the amount of bond or bond equivalent coverage required under this chapter, the dealer shall have the bond or bond equivalent adjusted to comply with this chapter. If the gross amount of business changes to warrant a decrease in the amount of bond or bond equivalent required under this chapter, the dealer may have the bond or bond equivalent adjusted accordingly.

(f) A licensee may furnish a blanket bond or bond equivalent, based upon the gross amount of business transacted on an annual basis for each enterprise operated under the same ownership, instead of individual instruments for each enterprise operated.

[Pre-2008 Recodification Citations: subsection (a) formerly 15-2.1-14-6(a); subsection (b) formerly 15-2.1-14-6(b); subsection (c) formerly 15-2.1-14-6(c); subsection (d) formerly 15-2.1-14-6(d); subsection (e) formerly 15-2.1-14-6(e); subsection (f) formerly 15-2.1-14-6(f).]

As added by P.L.2-2008, SEC.8.