30 Tex. Admin. Code § 37.551 - Corporate Guarantee for Liability
(a) An
owner or operator may meet the requirements of financial assurance for
liability as specified in Subchapter E of this chapter (relating to Financial
Assurance Requirements for Liability Coverage) by obtaining a written guarantee
for liability coverage, hereinafter referred to as "corporate guarantee," which
conforms to the requirements of this section, in addition to the requirements
as specified in Subchapter A of this chapter (relating to General Financial
Assurance Requirements).
(b) The
guarantor must be the direct or higher-tier parent corporation of the owner or
operator or a corporation with a substantial business relationship with the
owner or operator. The guarantor must meet the requirements for owners or
operators as specified in §
37.541 of this title (relating to
Financial Test for Liability). The guarantor must comply with the terms of the
corporate guarantee.
(c) The
wording of the corporate guarantee must be identical to the wording specified
in §
37.661 of this title (relating to
Corporate Guarantee for Liability). The corporate guarantee shall accompany the
items sent to the executive director as specified in §
37.541(d) of
this title.
(d) If the guarantor
has a substantial business relationship with the owner or operator, in addition
to the requirements specified in this chapter for the financial test and
corporate guarantee, the guarantor will submit the following:
(1) a description of the substantial business
relationship and the value received in consideration of the
guarantee;
(2) an original or
certified original copy of the Resolution by the Board of Directors or a
certified letter from the chief financial officer, authorizing the corporate
guarantee on behalf of the entity;
(3) an original or certified original copy of
the Resolution by the Board of Directors authorizing the formation or
acquisition of the guaranteed entity;
(4) an organizational chart which shows the
relationship between the two entities; and
(5) the partnership agreement or other
agreements, articles, or bylaws which set out the formation, structure, and
operation of the guaranteed entity.
(e) After the initial submission of the items
required in subsection (d) of this section, the chief financial officer may
submit a letter attesting that there has been no change, to demonstrate a
substantial business relationship, if there has been no change in the
substantial business relationship.
(f) The terms of the corporate guarantee
shall provide that if the owner or operator fails to satisfy a judgement based
on a determination of liability for bodily injury or property damage to third
parties caused by sudden or nonsudden accidental occurrences (or both, as the
case may be), arising from the operation of facilities covered by this
corporate guarantee, or fails to pay an amount agreed to in settlement of
claims arising from or alleged to arise from such injury or damage, the
guarantor shall do so up to the limits of coverage.
(g) In the case of corporations incorporated
in the United States, a guarantee may be used to satisfy the requirements of
this section only if the Attorneys General or Insurance Commissioners of:
(1) the state in which the guarantor is
incorporated; and
(2) each state in
which a facility covered by the guarantee is located have submitted a written
statement to the commission that a guarantee executed as described in this
section and §
37.661 of this title is a legally
valid and enforceable obligation in that state.
(h) In the case of corporations incorporated
outside the United States (U.S.), a guarantee may be used to satisfy the
requirements of this section only if:
(1) the
non-U.S. corporation has identified a registered agent for service of process
in each state in which a facility covered by the guarantee is located and in
the state in which it has its principal place of business; and
(2) the Attorneys General or Insurance
Commissioners of each state in which a facility covered by the guarantee is
located and the state in which the guarantor corporation has its principal
place of business, has submitted a written statement to the commission that a
guarantee executed as described in this section and §
37.661 of this title is a legally
valid and enforceable obligation in that state.
Notes
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