CG-5586-2 Surety Bond Guaranty

U.S. DEPARTMENT OF
HOMELAND SECURITY
U.S. COAST GUARD
CG-5586-2 (Rev. 05-06)

SURETY BOND GUARANTY

OMB Approval No.1625-0046
(Expires 09-06)

Surety Co. Bond No.

SURETY BOND GUARANTY FURNISHED AS EVIDENCE OF FINANCIAL RESPONSIBILITY UNDER THE OIL
POLLUTION ACT OF 1990 AND THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND
LIABILITY ACT, AS AMENDED

(Name of Vessel Operator)

Of

,
(City, State and Country)

(“Principal”), and the undersigned surety company or companies (“Surety” or “Sureties”), each authorized by the United
States Department of the Treasury to do business in the United States as an approved surety, are held and firmly bound
unto the United States of America and other claimants in the penal sum of
$
for costs and damages for which the Principal is liable under the Oil Pollution Act of 1990 (“OPA 90”) and the
Comprehensive Environmental Response, Compensation, and Liability Act, as amended (“CERCLA”) (referred to
collectively as the “Acts”). “Principal” includes, in addition to the vessel operator and the owner of each vessel covered by
this guaranty (“covered vessel”).
The Principal has elected to file with the Director, Coast Guard National Pollution Funds Center (“Center”) this
surety bond guaranty as evidence of financial responsibility to obtain from the Coast Guard a Certificate, or Certificates, of
Financial Responsibility (Water Pollution) under 33 CFR part 138, to meet any liability for costs and damages incurred in
connection with a covered vessel under section 1002 of OPA 90, as limited by section 1004(a), or section 107(a)(1) of
CERCLA, as limited by sections 107(c)(1)(A) and (B), or both.
The Surety agrees that the penal sum of this surety bond guaranty shall be available to pay to the United States
of America or other claimants under the Acts any sum or sums for which the Principal may be held liable under the Acts.
The penal sum shall be the total applicable amount, determined in accordance with the Applicable Amount Table below,
for which payment we, the undersigned, bind ourselves and our heirs, executors, administrators, successors and assigns,
jointly and severally.
No more than 10 Sureties (including lead Sureties) may execute this guaranty. If there is more than one surety
company executing this guaranty, we, the Sureties, bind ourselves in the penal sum jointly and severally for the purpose
of allowing a joint action or actions against any or all of us, and for all other purposes each Surety binds itself, jointly and
severally with the Principal, for the payment of the percentage of the penal sum only as is set forth opposite the name of
each Surety. If no percentage is indicated for a Surety or Sureties, the liability of such Surety or Sureties shall be joint
and several for the total of the unspecified portions.

(Name of lead guarantor)
is designated as the lead guarantor having authority to bind all guarantors for actions of guarantors under the Acts,
including but not limited to receipt of designation of source, advertisement of a designation, and receipt and settlement of
claims (inapplicable if only one Surety executes this guaranty).

An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it
displays a valid OMB control number.
The Coast Guard estimates that the average burden for completing this form is 30 minutes. You may submit any
comments concerning the accuracy of this burden estimate or any suggestion for reducing the burden to the:
Commandant (NPFC), U.S. Coast Guard, 2100 2nd Street, SW, Washington, DC 20593-0001 or Office of Management
and Budget, Paperwork Reduction Project (1625-0046), Washington, DC 20503.

Page 2 of CG-5586-2 (Rev. 05-06)

Principal and the Surety or Sureties agree that if all or a portion of the penal sum is paid, the penal sum is
considered reinstated to its full amount until 30 days after receipt from the Surety of written notice to the Director, NPFC,
that the penal sum has not been reinstated. Principal and the Surety or Sureties further agree that if at the time of an
incident, release, or threatened release a covered vessel is a tank vessel or is carrying a hazardous substance as cargo,
the penal sum of this surety bond guaranty automatically increases, if necessary, to the total applicable amount
appropriate for such vessel as determined in accordance with the Applicable Amount Table below. In no case, however,
shall the penal sum be increased to an amount greater than the total applicable amount.
The penal sum is not further conditioned or dependent in any way upon any contract, agreement or understanding
between the Principal and Surety. If the Principal is responsible for more than one vessel covered by this guaranty, then
the penal sum is the total applicable amount for the vessel having the greatest liability under the Acts.
The liability of the Surety as guarantor under OPA or CERCLA, or both, shall not be discharged by any payment
or succession of payments hereunder, unless and until such payment or payments amount in the aggregate to the penal
sum of this bond guaranty.
Any claim, including any claim by right of subrogation, against the Principal for costs and damages arising under
either section 1002 of OPA 90, as limited by section 1004(a), or section 107(a)(1) of CERCLA, as limited by sections
107(c)(1) (A) and (B), or both, may be brought directly against the Surety, and the Surety consents to suit with respect to
these claims. However, in any direct action under OPA 90 the Surety’s liability shall not exceed the amount determined
under part I of the Applicable Amount Table below and, in any direct action under CERCLA the Surety’s liability shall not
exceed the amount determined under part II of the Applicable Amount Table below. The Surety’s obligation hereunder
with respect to any one incident or release or threatened release shall be reduced by all payments or succession of
payments for costs and damages, to one or more claimants, made by or on behalf of the Principal under OPA 90 or
CERCLA or both, as applicable, for which the Principal is liable. In the event of a direct claim, the Surety may invoke only
the following rights and defenses:
(1)

The incident, release, or threatened release was caused by the willful misconduct of the Principal.

(2)

Any defense that the Principal may raise under the Acts.

(3)

A defense relating to the amount of a claim or claims, filed in any action in any court or other proceeding,
that exceeds the amount of this guaranty with respect to an incident or with respect to a release or
threatened release.

(4)

A defense relating to the amount of a claim or claims that exceeds the amount of this guaranty, which
amount is based on the gross tonnage of the vessel as entered on the vessel’s International Tonnage
Certificate or other official, applicable certificate of measurement, except where the surety knew or should
have known that the applicable tonnage certificate was incorrect.

(5)

The claim is not one made under either of the Acts.

This bond is effective the

day of
(Day)

,
(Month)

, 12:01 a.m., standard time
(Year)

at the address of the Surety first named herein, and shall continue in force until discharge or terminated as herein
provided. The above named Vessel Operator or the Surety may at any time terminate this bond guaranty by written
notice sent by certified mail, registered mail, overnight delivery, or other comparable service to the other party, with a copy
(showing that the original notice was sent to the other party by certified mail, registered mail, overnight delivery, or other
comparable service) to the Center. The termination is effective thirty (30) days after the Center receives the written notice
of termination. The Surety shall not be liable hereunder in connection with an incident, release, or threatened release
occurring after the termination of this bond guaranty as herein provided, but the termination shall not affect the liability of
the Surety in connection with an incident, release, or threatened release occurring prior to the date the termination
becomes effective. Nor shall the Surety be liable hereunder in connection with a non-covered vessel, which is a vessel
specifically named in other evidence of financial responsibility, which is applicable to that vessel on behalf of the above
named Vessel Operator, and which is accepted by and on file with the Center during an incident, release, or threatened
release giving rise to a claim against the Surety or Principal.

Page 3 of CG-5586-2 (Rev. 05-06)

The Surety designates
(Name of Agent)
with offices at
(Address)
as the Surety’s agent in the United States for service of process for the purposes of this surety bond guaranty and for
receipt of notices of designation and presentations of claims under the Acts. If the designated agent cannot be served
due to death, disability, or unavailability, the Director, Coast Guard National Pollution Funds Center, is the agent for these
purposes.
Title 33 CFR part 138 governs this bond guaranty.
In witness whereof, the Vessel Operator, for itself and owners, and Surety have executed this instrument on the
day of
,
.
(Day)

(Month)

(Year)
VESSEL OPERATOR

(Signature of Sole Proprietor or Partner)

(Typed)

(Business Address)

(Signature of Sole Proprietor or Partner)

(Typed)

(Business Address)

(Signature of Sole Proprietor or Partner)

(Typed)

(Business Address)

(Corporation)

(Business Address)

(Signature)

(Typed Name and Title)

(Affix Corporate Seal)

Page 4 of CG-5586-2 (Rev. 05-06)

SURETY

(Name)

(Percentage of Participation)

(Address)

(Affix Corporate Seal)

(State of Incorporation)

(Signature(s))

(Typed Name(s) and Title(s))

[NOTE: For every co-Surety, provide information in the same manner as for Surety above.]

Page 5 of CG-5586-2 (Rev. 05-06)

APPLICABLE AMOUNT TABLE

(I)

Applicable Amount Under the Oil Pollution Act of 1990.
VESSEL TYPE
Tank vessel
(except a tank vessel on which no
liquid hazardous material in bulk is
being carried as cargo or cargo
residue, and on which the only oil
carried as cargo or cargo residue is
an animal fat or vegetable oil, as
those terms are used in section 2
of the Edible Oil Regulatory
Reform Act (Pub. L.104-55))
Tank vessel

VESSEL’S GROSS TONS
Over 300 gross tons* but not to
exceed 3,000 gross tons.

The greater of $2,000,000 or
$1,200 per gross ton.

Over 3,000 gross tons.

The greater of $10,000,000 or
$1,200 per gross ton.

Over 300 gross tons.*

The greater of $500,000 or $600
per gross ton.

(except a tank vessel on which no
liquid hazardous material in bulk is
being carried as cargo or cargo
residue, and on which the only oil
carried as cargo or cargo residue is
an animal fat or vegetable oil, as
those terms are used in section 2
of the Edible Oil Regulatory
Reform Act (Pub. L.104-55))
Vessel other than a tank vessel

APPLICABLE AMOUNT

(specified above)

*This minimum gross ton limit does not apply to any vessel using the waters of the U.S. Exclusive Economic Zone to transship or lighter oil
destined for a place subject to the jurisdiction of the United States (as specified in 33 CFR 138.12(a)(1)).

(II)

Applicable Amount Under the Comprehensive Environmental Response, Compensation, and Liability Act,
as Amended.
VESSEL TYPE

(III)

APPLICABLE AMOUNT

Vessel over 300 gross tons carrying hazardous
substance as cargo

The greater of $5,000,000 or $300 per gross ton.

Any other vessel over 300 gross tons

The greater of $500,000 or $300 per gross ton.

Total Applicable Amount = Maximum applicable amount calculated under (I) plus maximum applicable amount
calculated under (II).