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TITLE 16ECONOMIC REGULATION
PART 4TEXAS DEPARTMENT OF LICENSING AND REGULATION
CHAPTER 71WARRANTORS OF VEHICLE PROTECTION PRODUCTS
RULE §71.22Registration Requirements--Financial Security Requirements

(a) Each applicant and registrant may comply with the financial security requirement under Texas Occupations Code, Chapter 2306 by submitting to the department the information required by one of the following four paragraphs:

  (1) proof of a reimbursement insurance policy described in Texas Occupations Code, Chapter 2306; the reimbursement insurance policy must include the "Vehicle Protection Product Warrantor Texas Endorsement" prescribed by the executive director or equivalent language;

  (2) an audit report and audited financial statements for its most recent fiscal year which demonstrate that either the applicant or the registrant, or the parent corporation of the applicant or registrant, if there is one, had a net worth of at least $50 million as of the end of its most recent fiscal year;

  (3) the audit report of an independent certified public accountant stating the auditor's unqualified opinion concerning the financial statements of the applicant or registrant as of the end of its most recent fiscal year, together with a certification from the same accountant who performed the audit that the applicant or registrant had a net worth in excess of $50 million as of the end of the period audited; or

  (4) the audit report of an independent certified public accountant stating the auditor's unqualified opinion concerning the financial statements of the parent corporation of the applicant or registrant as of the end of the parent corporation's most recent fiscal year, together with a certification from the same accountant who performed the audit of the parent corporation that it had a net worth in excess of $50 million as of the end of the period audited.

(b) If the applicant or registrant relies upon the net worth of its parent corporation to satisfy the financial security requirements of Texas Occupations Code, Chapter 2306, then the applicant or registrant must furnish sufficient written proof, such as a resolution of the parent corporation's board of directors, that the parent corporation has agreed to guarantee the liabilities and obligations of the applicant or registrant relating to vehicle protection products sold or offered for sale by the applicant or registrant in this state.

(c) Notwithstanding the other provisions of this section, an applicant or registrant shall promptly provide all financial statements and information to the executive director or his designate that are requested in writing by the executive director or his designate.


Source Note: The provisions of this §71.22 adopted to be effective October 25, 2001, 26 TexReg 8352; amended to be effective December 1, 2004, 29 TexReg 11029; amended to be effective September 1, 2006, 31 TexReg 6718

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