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a self -bond as an "indemnity agreement" between permit applicants, any guarantor, and the <br />regulatory authority). <br />Self -bonding is only allowed where a company meets all of certain criteria set forth at 30 <br />C.F.R. §§ 800.23(b) -(e). Among other things, certain financial conditions must all be met, <br />including that the company seeking to be self -bonded must: <br />• Have an "A" rating or higher for its most recent bond issuance, as issued by <br />Moody's Investor Service or Standard and Poor's Corporation; <br />• Have a net worth of at least $10 million or fixed assets in the U.S. of at least $20 <br />million, a ratio of total liabilities to net worth of 2.5 times or less, and a ratio of <br />current assets to current liabilities of 1.2 times or greater; and <br />• Ensure that the total amount of self -bonds do not exceed 25% of the company's, <br />or guarantor's, net worth in the United States. <br />30 C.F.R. §§ 800.23(b)(3) and (d). If any one of these, or other self -bonding criteria for that <br />matter, is not met, a company is not allowed to self -bond its mining operations. <br />If a company is self -bonded, it has a mandatory duty to "immediately" notify states <br />and/or OSMRE if financial conditions change such that it no longer meets the financial criteria at <br />30 C.F.R. §§ 800.23(b)(3) and (d). 30 C.F.R. § 800.23(g). Within 90 days of this notification, the <br />company must also post an alternate bond in the "same amount as the self -bond." Id. If the <br />company fails to do so, it must "cease coal extraction" and "shall immediately begin to conduct <br />reclamation operations[.]" 30 C.F.R. § 800.16(e)(2). <br />II. PEABODY'S FINANCIAL STATUS <br />In the case of Peabody Energy, reports indicate that while the company self -bonds mining <br />operations across the U.S., the company no longer meets the financial criteria for self -bonding <br />under 30 C.F.R. § 800.23. As detailed in recent reports, the company fails as follows: <br />• Peabody no longer has an "A" rating or higher, as issued by both Moody's <br />Investor Service and Standard and Poor's Corporation, rendering the company <br />ineligible for self -bonding under 30 C.F.R. § 800.23(b)(3)(i). As disclosed in a <br />December 2015 Moody's report, the company's corporate family rating is now <br />"CaO," which "reflects [Moody's] expectation of continued deterioration in the <br />company's credit metrics[.]"l Further, as of July 2015, Peabody's rating with <br />Standard and Poor's was "1313-.„2 <br />' Moody's Investors Service, "Moody's downgrades Peabody's ratings (CFR to Caa3), outlook negative,” website <br />available at https://www.moodys.com/research/Nloodys-downgrades-Peabodys-ratinP-s-CFR-to-Caa3-outlook- <br />negative--PR 341808. <br />2 StreetInsider.com, "UPDATE: Standard and Poor's Downgrades Peabody Energy (BTU) to `BB-'; Outlook to <br />Stable," website available at <br />2 <br />