Sec. 722.005. SECURITY REQUIREMENTS. (a) An applicant for an automobile club certificate of authority may provide the security required for that certificate by depositing with the state or pledging in the form prescribed by the secretary of state:
(1) $25,000 in securities approved by the secretary;
(2) $25,000 in cash; or
(3) a $25,000 bond in the form prescribed by the secretary that is:
(A) payable to the state;
(B) executed by a corporate surety licensed to do business in this state; and
(C) conditioned on the faithful performance of the automobile club in selling or providing club services and the payment of any fines or penalties levied against the club for failure to comply with this chapter.
(b) The aggregate liability of the surety for all breaches of the bond conditions and for payment of all fines and penalties may not exceed the amount of the bond.
(c) The required security shall be maintained as long as the automobile club has any liability or obligation in this state. On showing to the satisfaction of the secretary of state that the club has ceased to do business and that all liabilities and obligations of the club have been satisfied, the secretary may return the security to the club or deliver the security in accordance with a court order.
Acts 1995, 74th Leg., ch. 165, Sec. 1, eff. Sept. 1, 1995.
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