Sec. 409. (a) Sixty (60) days after making a written request for release to the administrator, the surety of a bond furnished by a distributor is released from any liability to the state accruing on the bond after the sixty (60) day period. The release does not affect any liability accruing before the expiration of the sixty (60) day period.

(b) One hundred eighty (180) days after making a written request for release to the administrator, the financial institution issuing the letter of credit for a distributor is released from any liability accruing on the letter of credit.

(c) The administrator shall promptly notify the distributor furnishing the bond or letter of credit that a release has been requested, and unless the distributor obtains a new bond or letter of credit which meets the requirements of section 406 of this chapter and files with the administrator:

(1) the new bond within the sixty (60) day period; or

(2) the new letter of credit within the one hundred eighty (180) day period;

the administrator shall cancel the distributor's license.

(d) Sixty (60) days after making a written request for release to the administrator, the cash deposit provided by a distributor is cancelled as security for any obligation accruing after the expiration of the sixty (60) day period. However, the administrator may retain all or part of the cash deposit for up to three (3) years and one (1) day as security for any obligations accruing before the effective date of the cancellation. Any part of the deposit that is not retained by the administrator shall be released to the distributor. Before the expiration of the sixty (60) day period, the distributor must provide the administrator with a bond or letter of credit that satisfies section 406 of this chapter, or the administrator shall cancel the distributor's license.

As added by Acts 1979, P.L.79, SEC.1. Amended by P.L.97-1987, SEC.7.