Section 187.6 - Application Procedure for Financial Institutions To Become Participating Financial Institutions(a) A financial institution must complete and remit to the Office a participation agreement, developed by the Office, to enroll loans under the program.(b) The participation agreement shall provide for: (1) the creation of the reserve account by the Office for the benefit of the participating financial institution;(2) the limitation of liability of the state of Texas and the Office to the balance held in reserve of a participating financial institution;(3) the terms and conditions of the loans under the program to be determined solely by agreement of the lender and borrower;(4) the enrollment of qualified loans into the program;(5) the deposit of funds by the eligible applicant, the participating financial institution, and subject to availability in the fund, the Office, into a reserve account when the participating financial institution makes an eligible capital access loan;(6) a claims process for reimbursement of losses incurred from charge-offs under the program;(7) removal of money from the reserve account to offset losses incurred through the program;(8) disposition of any recoveries from a borrower made by the participating financial institution subsequent to being reimbursed by the Office;(9) conditions for subrogation of the Office, at the Office's request, to the rights of the participating financial institution in collateral, personal guarantees, and all other forms of security for the capital access loan;(10) conditions for the withdrawal by the Office of excess balances in the reserve account;(11) conditions for the withdrawal by the Office of interest earned within the reserve account;(12) conditions for termination of the participation agreement, and disposition by the Office of any remaining balance in the reserve account;(13) termination by the Office of the obligation to enroll eligible borrowers into the program;(14) withdrawal by a participating financial institution from the program, and disposition by the Office of any remaining balance in the reserve account;(15) periodic reporting to the Office by the participating financial institution as required by the Office;(16) inspection by the Office of the pertinent files of the participating financial institution relating to qualified eligible borrowers;(17) transmittal to the Office by participating financial institution of any public information directly relating to the institution's participation in the program;(18) the submission of an annual report by the participating financial institution to the department containing the information required by Chapter 481, Subchapter BB, §481.411;(19) the delivery of financial statements of the financial institution as available for the previous three years to the department;(20) such other terms and conditions as may be required by the department.(c) The department, based on the information provided by the financial institution, reserves the right to not allow an institution to participate in the program.10 Tex. Admin. Code § 187.6
The provisions of this §187.6 adopted to be effective September 15, 1997, 22 TexReg 8967; amended to be effective August 5, 2012, 37 TexReg 5735