[Code of Federal Regulations]
[Title 7, Volume 7, Parts 700 to 899]
[Revised as of January 1, 2001]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR740.6]

[Page 323]
 
                          TITLE 7--AGRICULTURE
 
                            CHAPTER VII--FARM
                SERVICE AGENCY, DEPARTMENT OF AGRICULTURE
 
PART 740--NUT WAREHOUSES--Table of Contents
 
Sec. 740.6  Net assets.

    (a) Each warehouseman conducting a warehouse licensed, or for which 
application for a license has been made under the regulations in this 
part, shall have and maintain above all exemptions and liabilities, 
total net assets liable for the payment of any indebtedness arising from 
the conduct of the warehouse, to the extent of at least $25 per ton for 
the maximum number of tons of peanuts, 2 cents per pound for the maximum 
number of pounds of walnuts or filberts, and/or 3 cents per pound for 
the maximum number of pounds of pecans, that the warehouse could 
accommodate when stored in the manner customary to the warehouse as 
determined by the Administrator: Provided, That no person may be 
licensed as a warehouseman under the regulations in this part unless he 
has allowable net assets of at least $10,000: And provided further, That 
any deficiency in net assets required above the $10,000 minimum may be 
supplied by an increase in the amount of the warehouseman's bond in 
accordance with Sec. 740.14(c). In determining total net assets, credit 
may be given for insurable property such as buildings, machinery, 
equipment, and merchandise inventory, only to the extent that such 
property is protected by insurance against loss or damage by fire. Such 
insurance shall be in the form of lawful policies issued by one or more 
insurance companies authorized to do such business and subject to 
service of process in suits brought in the State in which the warehouse 
is located.
    (b) In case a warehouseman is licensed or is applying for licenses 
to operate two or more warehouses under the regulations in this part, 
the maximum quantity of nuts which all such warehouses will accommodate 
when stored in the manner customary to the warehouse, as determined by 
the Administrator, shall be considered in determining whether the 
warehouseman meets the net assets requirements specified in paragraph 
(a) of this section.
    (c) For the purposes of paragraphs (a) and (b) of this section only, 
capital stock as such shall not be considered a liability.