Collateral bond means an indemnity agreement in a sum certain, executed by the permittee as principal, which is supported by the deposit with the regulatory authority of one or more of the following:

1. (1) A cash account, which must be the deposit of cash -

   1. (i) In one or more federally-insured or equivalently protected accounts, payable only to the regulatory authority upon demand; or
   2. (ii) Directly with the regulatory authority.
2. (2) Negotiable bonds of the United States, a state, or a municipality, endorsed to the order of, and placed in the possession of, the regulatory authority.
3. (3) Negotiable certificates of deposit, made payable or assigned to the regulatory authority and placed in its possession or held by a federally-insured bank.
4. (4) An irrevocable letter of credit of any bank organized or authorized to transact business in the United States, payable only to the regulatory authority upon presentation.
5. (5) A perfected, first-lien security interest in real property in favor of the regulatory authority.

6. (6) Other securities with a rating of “A” or higher from either Moody's Investors Service or Standard and Poor's or an equivalent rating issued by any other nationally recognized statistical rating organization registered with the Securities and Exchange Commission, endorsed to the order of, and placed in the possession of, the regulatory authority.

   Financial assurance is a type of alternative bonding system that consists of a trust, an annuity, or a combination thereof.

   Self-bond means an indemnity agreement in a sum certain executed by the applicant or by the applicant and any corporate guarantor and made payable to the regulatory authority, with or without separate surety.

   Surety bond means an indemnity agreement in a sum certain payable to the regulatory authority, executed by the permittee as principal, which is supported by the performance guarantee of a corporation licensed to do business as a surety in the state where the operation is located.