SECTION 215.137. Surety Bond

(a) The surety bond required by Transportation Code, §503.033 shall be in the legal business name in which the dealer's license will be issued and shall contain the complete physical address of each dealership location licensed under the GDN that the surety bond is intended to cover.

(b) A surety bond executed by an agent representing a bonding company or surety must be supported by an original power of attorney from the bonding company or surety.

(c) The identity of the obligee on a surety bond or a rider to a surety bond must be approved by the department. A surety bond or rider to a surety bond may be identified as:

(1) a person who obtains a court judgment assessing damages and attorney's fees for an act or omission on which the bond is conditioned; or

(2) unknown.

(d) A bonding company that pays any claim against a surety bond shall immediately report the payment to the department.

(e) A bonding company shall give written notice to the department 30 days prior to canceling any surety bond.

(f) The surety bond required by this section does not apply to a:

(1) franchised motor vehicle dealer licensed by the department;

(2) franchised motorcycle dealer licensed by the department;

(3) franchised house trailer or travel trailer dealer licensed by the department; or

(4) trailer or semitrailer dealer licensed by the department.

Source Note: The provisions of this §215.137 adopted to be effective February 11, 2010, 35 TexReg 883; amended to be effective February 13, 2017, 42 TexReg 571