Texas Insurance Code
§ 425.1185 — AUTHORIZED INVESTMENTS: MEZZANINE REAL ESTATE LOANS
IN § 425.1185Title 4. REGULATION OF SOLVENCY · Part B. RESERVES AND INVESTMENTS · Ch. 425. RESERVES AND INVESTMENTS FOR LIFE INSURANCE · Art. C. AUTHORIZED INVESTMENTS AND TRANSACTIONS FOR CAPITAL STOCK LIFE, HEALTH, AND ACCIDENT INSURERS
Statute text
View on source(a)In this section, "mezzanine real estate loan" means a loan that is secured by a pledge of direct or indirect equity interests in an entity that owns real estate.
(b)Subject to Subsections (c) and (d), an insurance company with more than $10 billion in admitted assets may invest in a mezzanine real estate loan if the loan documents:
(1)require that each pledgor abstain from granting an additional security interest in the equity interest pledged;
(2)employ techniques to minimize the likelihood or impact of a bankruptcy filing by the real estate owner or the mezzanine real estate loan borrower; and
(3)require the real estate owner or the mezzanine real estate loan borrower to:
(A)hold no assets other than, in the case of the owner, the real estate, and in the case of the borrower, the equity interests in the entity;
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Legislative history
Added by Acts 2015, 84th Leg., R.S., Ch. 310 (S.B. 1008), Sec. 1, eff. September 1, 2015.