Current as of April 14, 2021 | Updated by FindLaw Staff
Welcome to FindLaw's Cases & Codes, a free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes, visit FindLaw's Learn About the Law.
(a) Except as provided by Subsection (b), a pawnbroker shall maintain net assets of at least $150,000 that are used or readily available for use in the business of each pawnshop.
(b) A pawnbroker who held a license under this chapter before September 1, 1999, shall maintain net assets that are used or readily available for use in the business for that existing license of at least the amount required on August 31, 1999. The net assets requirement of this subsection remains in effect without regard to a change in ownership or relocation of the license.
(c) Net assets must be represented by a capital investment unencumbered by a lien or other encumbrance and subject to a claim by a general creditor.
(d) Subject to Subsection (b), a pawnbroker shall maintain for each pawnshop net assets, as that term was defined at the time the license was issued, that are used or readily available for use in the business of the pawnshop of at least the amount required on:
(1) August 31, 1981, if the pawnbroker held a license on that date; or
(2) June 20, 1987, if the pawnbroker held a license on that date but did not hold a license on August 31, 1981.
(d) In this section, “capital investment” means:
(1) common or preferred shares and capital or earned surplus as those terms are defined by the Texas Business Corporation Act if the pawnbroker is a corporation; or
(2) a substantial equivalent of items described by Subdivision (1), as determined by generally accepted accounting principles, if the pawnbroker is not a corporation.
(e) Subject to Subsection (d), net assets must be represented by a capital investment unencumbered by a lien or other encumbrance and subject to a claim by a general creditor.
(e) Subsection (b) applies to a change in ownership that is:
(1) a transaction involving a different owner who had a significant family or business relationship with a prior owner before the transaction;
(2) a transaction in which:
(A) only the number or proportionate ownership of owners of a business changes; and
(B) an individual who was not an owner before the transaction is not an owner after the transaction; or
(3) a change in ownership that occurs by testate or intestate disposition.
Cite this article: FindLaw.com - Texas Finance Code - FIN § 371.072. Net Assets Requirement - last updated April 14, 2021 | https://codes.findlaw.com/tx/finance-code/fin-sect-371-072/
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature or via Westlaw before relying on it for your legal needs.