§514E-28  Requirements for surety bonds and
letters of credit.  Any surety bond or irrevocable letter of credit
furnished to the director pursuant to section 514E-19 must be in an amount
which is not less than one hundred ten per cent of the remaining principal
balance of every indebtedness secured by a blanket lien related to the time
share unit.  Any such bond must be issued by a surety authorized to do business
in the State and having sufficient net worth to be acceptable to the director. 
Any such letter of credit must be irrevocable and must be drawn upon a bank,
savings and loan association, or other financial institution authorized to do
business in the State and having a sufficient net worth to be acceptable to the
director.  The bond or irrevocable letter of credit shall provide for payment
(up to the limit of such bond or letter of credit) of all amounts secured by
the blanket lien, including costs, expenses, and legal fees of the lienholder,
if for any reason the blanket lien is enforced.  The beneficiary of any such
letter of credit and the obligee of any such bond shall be the director on
behalf of the owners.  The bond or irrevocable letter of credit may be reduced
periodically in proportion to the reduction of the remaining principal balance of
the indebtedness secured by the blanket liens.  Upon being furnished with a
surety bond or irrevocable letter of credit satisfying the foregoing
requirements, the developer shall prepare and the director shall execute and
acknowledge a document in recordable form accepting such surety bond or
irrevocable letter of credit and identifying the time share units to which it
applies. [L 1982, c 186, §16]