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As Reported by the House Insurance Committee
122nd General Assembly
Regular Session
1997-1998 | Sub. H. B. No. 370 |
REPRESENTATIVES BATCHELDER-BUCHY-CAREY-CATES-COLONNA-GARCIA-
HAINES-HODGES-HOUSEHOLDER-JERSE-METELSKY-MOTTLEY-NETZLEY-OPFER-
REID-SCHULER-STAPLETON-TAYLOR-TERWILLEGER-TIBERI-VAN VYVEN-
WACHTMANN-YOUNG
A BILL
To amend section 3901.043; to amend, for the purpose of adopting a new section
number as
indicated in parentheses, section 3913.31 (3913.40);
and to
enact new section 3913.31 and sections 3913.25, 3913.26,
3913.27, 3913.28, 3913.29, 3913.30, 3913.32, 3913.33, 3913.34,
3913.35, 3913.36, and 3913.37 of the Revised Code to permit a
mutual insurance company to raise
capital by reorganizing as a stock insurance
company that is a majority-owned subsidiary of a
mutual insurance holding
company.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That section 3901.043 be amended, section 3913.31 (3913.40) be
amended for the
purpose of adopting a new section number as indicated in
parentheses, and new section 3913.31 and sections 3913.25,
3913.26, 3913.27, 3913.28, 3913.29, 3913.30, 3913.32, 3913.33,
3913.34, 3913.35, 3913.36, and 3913.37 of the Revised Code be
enacted to read as follows:
Sec. 3901.043. The superintendent of insurance may adopt rules in accordance
with Chapter 119. of the Revised Code to establish reasonable fees for any
service or transaction performed by the department of insurance pursuant to
section 1738.04, 1742.03, 3901.321, 3901.341, 3907.09, 3907.10, 3907.11,
3907.12, 3911.011, 3913.31 3913.40,
3915.14, 3917.06, 3918.07, 3923.02, 3935.04,
3937.03, 3953.28, 3957.12, or 3957.13 of the Revised
Code or any provision in sections 3913.01 to 3913.23 or in Chapter
3905. of the Revised Code, if no fee is otherwise provided under Title XVII or
XXXIX of the Revised Code for such service or transaction. Any fee collected
pursuant to those rules shall be paid into the state treasury to the credit of
the department of insurance operating fund.
Sec. 3913.25. AS USED IN SECTIONS 3913.25 TO 3913.37 OF
THE REVISED
CODE:
(A) "INTERMEDIATE
HOLDING COMPANY" MEANS A STOCK CORPORATION THAT OWNS ALL OF THE
SHARES OF VOTING STOCK OF ONE OR MORE REORGANIZED STOCK
COMPANIES AFTER A REORGANIZATION UNDER SECTIONS 3913.25 TO
3913.37 OF THE REVISED
CODE. "INTERMEDIATE HOLDING
COMPANY" ALSO MEANS A STOCK CORPORATION THAT IS THE PARENT OR
SUBSIDIARY OF ANOTHER INTERMEDIATE HOLDING COMPANY.
(B) "MUTUAL INSURANCE
COMPANY" MEANS A DOMESTIC OR FOREIGN MUTUAL LIFE INSURANCE
COMPANY OR A DOMESTIC OR FOREIGN MUTUAL INSURANCE COMPANY OTHER
THAN A MUTUAL LIFE INSURANCE COMPANY.
(C) "MUTUAL INSURANCE
HOLDING COMPANY" MEANS A DOMESTIC MUTUAL INSURANCE
HOLDING COMPANY INCORPORATED PURSUANT TO A REORGANIZATION PLAN
ADOPTED UNDER SECTIONS 3913.26 TO 3913.28 OF THE
REVISED
CODE, WHICH COMPANY IS THE
PARENT COMPANY OF A REORGANIZED STOCK COMPANY OR OF AN
INTERMEDIATE HOLDING COMPANY.
(D) "POLICYHOLDER" HAS
THE SAME MEANING AS IN SECTION 3913.10 OF THE
REVISED
CODE WHEN USED WITH RESPECT TO
A LIFE INSURANCE COMPANY, AND HAS THE SAME MEANING AS IN SECTION
3913.20 OF THE REVISED
CODE WHEN USED WITH RESPECT TO
AN INSURANCE COMPANY OTHER THAN A LIFE INSURANCE COMPANY.
(E) "REORGANIZATION
PLAN" MEANS A REORGANIZATION PLAN ADOPTED BY A MUTUAL INSURANCE
COMPANY'S BOARD OF DIRECTORS IN ACCORDANCE WITH SECTION 3913.26
OF THE REVISED
CODE.
(F) "REORGANIZED STOCK
COMPANY" MEANS THE DOMESTIC OR FOREIGN STOCK INSURANCE COMPANY
RESULTING FROM A DOMESTIC OR FOREIGN MUTUAL INSURANCE COMPANY'S
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE.
(G) "VOTING STOCK" MEANS
SECURITIES OF ANY CLASS OR ANY OWNERSHIP INTEREST HAVING VOTING
POWER FOR THE ELECTION OF DIRECTORS, TRUSTEES, OR MANAGEMENT OF
A PERSON, OTHER THAN SECURITIES HAVING VOTING POWER ONLY AS A
RESULT OF THE OCCURRENCE OF A CONTINGENCY.
Sec. 3913.26. (A) A
MUTUAL INSURANCE COMPANY, BY ITSELF OR TOGETHER WITH ONE OR MORE
OTHER MUTUAL INSURANCE COMPANIES ACTING PURSUANT TO A JOINT
REORGANIZATION PLAN, MAY REORGANIZE IN ACCORDANCE WITH THE
REQUIREMENTS OF SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE.
(B)(1) A MUTUAL
INSURANCE COMPANY MAY ADOPT A REORGANIZATION PLAN THAT IS
CONSISTENT WITH THE REQUIREMENTS OF SECTIONS 3913.25 TO 3913.37
OF THE REVISED
CODE. SUCH A REORGANIZATION PLAN MAY ONLY BE
ADOPTED BY THE AFFIRMATIVE VOTE OF NOT LESS THAN TWO-THIRDS OF
THE MUTUAL INSURANCE COMPANY'S BOARD OF DIRECTORS.
(2) AT ANY TIME PRIOR TO THE MAILING TO POLICYHOLDERS OF THE
NOTICE PURSUANT TO DIVISION (B)
OF SECTION 3913.27 OF THE
REVISED
CODE, WHICH NOTICE INCLUDES A
SUMMARY OF THE REORGANIZATION PLAN, A MUTUAL INSURANCE COMPANY'S
BOARD OF DIRECTORS MAY AMEND THE REORGANIZATION PLAN BY THE
AFFIRMATIVE VOTE OF NOT LESS THAN TWO-THIRDS OF THE BOARD OF
DIRECTORS.
AT ANY TIME BEFORE A REORGANIZATION PLAN HAS RECEIVED
THE APPROVAL OF THE SUPERINTENDENT OF INSURANCE UNDER SECTION
3913.28 OF THE REVISED
CODE, A MUTUAL INSURANCE
COMPANY'S BOARD OF DIRECTORS MAY WITHDRAW THE REORGANIZATION PLAN BY
THE AFFIRMATIVE VOTE OF NOT LESS THAN TWO-THIRDS OF THE BOARD OF
DIRECTORS.
(C) A REORGANIZATION
PLAN SHALL PROVIDE FOR THE INCORPORATION OF A MUTUAL
INSURANCE HOLDING COMPANY, AND SHALL PROVIDE FOR THE
CONTINUATION OF THE CORPORATE EXISTENCE OF THE MUTUAL INSURANCE
COMPANY AS A STOCK INSURANCE COMPANY.
(D) A REORGANIZATION
PLAN SHALL PROVIDE THAT ALL OF THE INITIAL SHARES OF VOTING
STOCK OF A REORGANIZED STOCK COMPANY SHALL BE ISSUED TO ITS
PARENT MUTUAL INSURANCE HOLDING COMPANY OR TO AN INTERMEDIATE
HOLDING COMPANY. NOTHING IN SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE, HOWEVER, SHALL BE
CONSTRUED AS LIMITING OR RESTRICTING THE AUTHORITY OF A
REORGANIZED STOCK COMPANY OR OF AN INTERMEDIATE HOLDING COMPANY
TO ISSUE SECURITIES OTHER THAN VOTING STOCK.
(E)(1) A REORGANIZATION
PLAN SHALL PROVIDE THAT THE MEMBERSHIP INTERESTS OF THE
POLICYHOLDERS OF A MUTUAL INSURANCE COMPANY SHALL BECOME
MEMBERSHIP INTERESTS IN THE MUTUAL INSURANCE HOLDING COMPANY,
AND THAT CONCURRENTLY THE POLICYHOLDERS' MEMBERSHIP INTERESTS IN
THE MUTUAL INSURANCE COMPANY SHALL BE EXTINGUISHED.
(2) A REORGANIZATION PLAN SHALL PROVIDE THAT THE
POLICYHOLDERS OF THE REORGANIZED STOCK COMPANY SHALL BECOME
MEMBERS OF THE MUTUAL INSURANCE HOLDING COMPANY IN ACCORDANCE
WITH THE ARTICLES OF INCORPORATION AND THE CODE OF REGULATIONS
OF THE MUTUAL INSURANCE HOLDING COMPANY.
(F) A REORGANIZATION
PLAN SHALL PROVIDE THAT THE MUTUAL INSURANCE HOLDING COMPANY
SHALL AT ALL TIMES OWN A MAJORITY OF THE VOTING STOCK OF THE
REORGANIZED STOCK COMPANY. ALTERNATIVELY, A REORGANIZATION PLAN
SHALL PROVIDE THAT THE MUTUAL INSURANCE HOLDING COMPANY SHALL AT
ALL TIMES OWN A MAJORITY OF THE VOTING STOCK OF AN INTERMEDIATE
HOLDING COMPANY, WHICH INTERMEDIATE HOLDING COMPANY SHALL AT ALL
TIMES OWN ALL OF THE VOTING STOCK OF THE REORGANIZED STOCK
COMPANY.
THE SHARES OF VOTING STOCK REQUIRED TO BE OWNED BY THE
MUTUAL INSURANCE HOLDING COMPANY, AND BY THE INTERMEDIATE
HOLDING COMPANY, IF ANY, SHALL NOT BE PLEDGED, HYPOTHECATED, OR
IN ANY WAY ENCUMBERED WITH REGARD TO ANY OBLIGATION, GUARANTY,
OR COMMITMENT UNDERTAKEN BY OR ON BEHALF OF THE MUTUAL INSURANCE
HOLDING COMPANY, OR THE INTERMEDIATE HOLDING COMPANY, IF
ANY.
(G) THE BOARD OF
DIRECTORS OF A MUTUAL INSURANCE COMPANY SHALL FILE ALL OF THE
FOLLOWING WITH THE SUPERINTENDENT WITHIN NINETY DAYS AFTER
ADOPTING A REORGANIZATION PLAN:
(1) THE REORGANIZATION PLAN;
(2) THE FORMS OF NOTICES TO BE PROVIDED TO POLICYHOLDERS
UNDER DIVISION (B) OF SECTION
3913.27 OF THE REVISED
CODE;
(3) THE FORM OF PROXY, IF ANY, TO BE SOLICITED FROM
POLICYHOLDERS;
(4) THE PROPOSED ARTICLES OF INCORPORATION AND CODE OF
REGULATIONS FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE
REORGANIZED STOCK COMPANY, AND, IF APPLICABLE, FOR AN
INTERMEDIATE HOLDING COMPANY. THE ARTICLES OF INCORPORATION AND
CODE OF REGULATIONS SHALL BE SIGNED BY THE CHAIRPERSON OF THE
BOARD, THE PRESIDENT OR VICE-PRESIDENT, AND BY THE SECRETARY OR
AN ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY.
(5) SUCH OTHER DOCUMENTS OR INFORMATION AS THE
SUPERINTENDENT MAY REQUIRE.
(H) NOTHING IN SECTIONS
3913.25 TO 3913.37 OF THE
REVISED
CODE SHALL LIMIT OR RESTRICT AN
INTERMEDIATE HOLDING COMPANY'S AUTHORITY UNDER SECTION 1701.13
OF THE REVISED
CODE TO FORM OR ACQUIRE THE
CONTROL OF OTHER CORPORATIONS, WHETHER DOMESTIC OR FOREIGN,
PROFIT OR NONPROFIT.
Sec. 3913.27. (A) A
REORGANIZATION PLAN ADOPTED BY A MUTUAL INSURANCE COMPANY'S
BOARD OF DIRECTORS PURSUANT TO SECTION 3913.26 OF THE
REVISED
CODE SHALL BE VOTED UPON BY A
MUTUAL INSURANCE COMPANY'S POLICYHOLDERS AT A POLICYHOLDERS'
MEETING. A POLICYHOLDER IS ENTITLED TO CAST ONLY ONE VOTE, IN
PERSON OR BY PROXY, ON THE REORGANIZATION PLAN REGARDLESS OF THE
NUMBER OF POLICIES OR CONTRACTS THAT THE POLICYHOLDER MAY OWN OR
HOLD.
ONLY PROXIES SPECIFICALLY RELATED TO THE REORGANIZATION
PLAN SHALL BE USED IN DETERMINING WHETHER THE REORGANIZATION
PLAN IS APPROVED PURSUANT TO DIVISION
(C) OF THIS SECTION.
(B) ALL POLICYHOLDERS
SHALL BE GIVEN NOTICE OF THE POLICYHOLDERS' MEETING TO VOTE UPON
THE REORGANIZATION PLAN AT LEAST THIRTY DAYS PRIOR TO THE DATE
FIXED FOR THE POLICYHOLDERS' MEETING.
NOTICE OF THE TIME AND PLACE OF SUCH MEETING SHALL BE SENT
BY MAIL TO EACH POLICYHOLDER AT THE POLICYHOLDER'S POST OFFICE
ADDRESS AS IT APPEARS ON THE BOOKS AND RECORDS OF THE
COMPANY.
THE NOTICE SHALL INCLUDE A SUMMARY OF THE REORGANIZATION PLAN
ADOPTED BY THE BOARD OF DIRECTORS,
INCLUDING AN ANALYSIS OF THE MATERIAL FINANCIAL ASPECTS
AND POTENTIAL FOR DILUTION OF POLICYHOLDERS' INTERESTS IN THE
MUTUAL INSURANCE COMPANY UNDER THE REORGANIZATION PLAN,
A UNIFORM BALLOT FOR VOTING
ON THE QUESTION OF THE REORGANIZATION PLAN, AND A STATEMENT
INFORMING THE POLICYHOLDERS THAT THE SUPERINTENDENT OF INSURANCE
MAY FIX A TIME AND PLACE FOR A PUBLIC HEARING ON THE
REORGANIZATION PLAN, TO BE HELD WITHIN THIRTY DAYS AFTER THE
SUPERINTENDENT'S RECEIPT OF WRITTEN NOTICE FROM THE BOARD OF
DIRECTORS OF THE POLICYHOLDERS' APPROVAL OF THE REORGANIZATION
PLAN.
(C) A REORGANIZATION
PLAN SHALL BE APPROVED UPON RECEIVING THE AFFIRMATIVE VOTE OF AT
LEAST A MAJORITY OF THE VOTES CAST BY POLICYHOLDERS.
(D)(1) IF A
REORGANIZATION PLAN IS APPROVED AT THE POLICYHOLDERS' MEETING,
THE BOARD OF DIRECTORS OF A MUTUAL INSURANCE COMPANY SHALL
PROVIDE THE SUPERINTENDENT WITH WRITTEN NOTICE OF
THAT APPROVAL WITHIN TEN DAYS AFTER THE POLICYHOLDERS'
MEETING.
(2) THE SUPERINTENDENT MAY, WITHIN TEN DAYS AFTER
RECEIVING THE NOTICE FROM THE BOARD OF DIRECTORS, PROVIDE
WRITTEN NOTICE TO THE MUTUAL INSURANCE COMPANY OF THE
SUPERINTENDENT'S INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS
ON THE REORGANIZATION PLAN. AT A MINIMUM, THE SUPERINTENDENT'S
NOTICE TO THE MUTUAL INSURANCE COMPANY SHALL INCLUDE A TIME AND
A PLACE FOR THE FIRST PUBLIC HEARING, WHICH SHALL BE HELD WITHIN
THIRTY DAYS AFTER THE SUPERINTENDENT'S RECEIPT OF THE NOTICE
FROM THE BOARD OF DIRECTORS.
(3) WITHIN TEN DAYS AFTER THE MUTUAL INSURANCE COMPANY'S
RECEIPT OF A NOTICE FROM THE SUPERINTENDENT OF THE
SUPERINTENDENT'S INTENT TO CONDUCT ONE OR MORE PUBLIC HEARINGS
ON THE REORGANIZATION PLAN, IF SUCH NOTICE IS PROVIDED, THE
MUTUAL INSURANCE COMPANY SHALL
PROVIDE NOTICE OF THE TIME AND PLACE OF SUCH HEARING BY CAUSING
THIS INFORMATION TO BE PUBLISHED ONCE EACH WEEK FOR TWO
CONSECUTIVE WEEKS IN A NEWSPAPER PUBLISHED AND OF THE LARGEST
CIRCULATION IN THE COUNTIES OF CUYAHOGA, FRANKLIN,
HAMILTON, AND LUCAS, IN THE COUNTY IN THIS STATE
IN WHICH THE MUTUAL INSURANCE COMPANY HAS ITS PRINCIPAL OFFICE,
AND IN THE NEWSPAPER OF THE LARGEST CIRCULATION IN THE STATE
CAPITAL OF EACH STATE OF THE UNITED STATES IN
WHICH THE COMPANY MAINTAINS AN OFFICE OR AGENCY FOR THE
SOLICITATION OF INSURANCE.
(E) THE PROPOSED
ARTICLES OF INCORPORATION AND CODE OF REGULATIONS FOR THE MUTUAL
INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY,
AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, AS
FILED WITH THE SUPERINTENDENT PURSUANT TO DIVISION
(G)(4) OF SECTION 3913.26 OF
THE REVISED
CODE, SHALL ALSO BE VOTED UPON
BY THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS AT THE
POLICYHOLDERS' MEETING HELD PURSUANT TO THIS SECTION. THE
ARTICLES OF INCORPORATION AND CODE OF REGULATIONS SHALL BE
ADOPTED UPON RECEIVING THE AFFIRMATIVE VOTE AT LEAST A MAJORITY
OF THE VOTES CAST BY POLICYHOLDERS.
(F) AT ALL PUBLIC
HEARINGS CONDUCTED BY THE SUPERINTENDENT PURSUANT TO THE
SUPERINTENDENT'S AUTHORITY UNDER DIVISION
(D)(2) OF THIS SECTION, THE
SUPERINTENDENT MAY SUMMON AND COMPEL THE ATTENDANCE AND
TESTIMONY OF WITNESSES AND THE PRODUCTION OF BOOKS AND PAPERS.
THE
SUPERINTENDENT SHALL HEAR THE TESTIMONY OF PERSONS CLAIMING TO
BE ADVERSELY AFFECTED BY THE REORGANIZATION PLAN,
AND OF OTHERS WISHING TO COMMENT ON THE REORGANIZATION PLAN. SUCH PERSONS
MAY
PRESENT A
POSITION AND OFFER COMMENTS CONCERNING THE REORGANIZATION
PLAN, INCLUDING A POSITION AND COMMENTS CONCERNING WHETHER THE
REORGANIZATION PLAN IS FAIR AND EQUITABLE TO THE MUTUAL
INSURANCE COMPANY'S POLICYHOLDERS AND WHETHER IT COMPLIES WITH
SECTIONS 3913.25 TO 3913.37 OF THE REVISED CODE.
(G) A MUTUAL INSURANCE
COMPANY'S FAILURE TO PROVIDE A MEMBER OR MEMBERS WITH THE NOTICE
REQUIRED BY THIS SECTION SHALL NOT IMPAIR THE VALIDITY OF ANY
ACTION TAKEN UNDER SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE, IF THE MUTUAL INSURANCE
COMPANY HAS COMPLIED SUBSTANTIALLY AND IN GOOD FAITH WITH ALL
NOTICE REQUIREMENTS.
THE DETERMINATION AS TO SUCH COMPLIANCE SHALL BE MADE BY
THE SUPERINTENDENT.
Sec. 3913.28. (A) A
MUTUAL INSURANCE COMPANY SHALL NOT PROCEED WITH A REORGANIZATION
PLAN APPROVED BY THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS
UNDER SECTION 3913.27 OF THE
REVISED
CODE UNTIL THE REORGANIZATION
PLAN HAS BEEN REVIEWED BY, AND HAS RECEIVED THE APPROVAL OF, THE
SUPERINTENDENT OF INSURANCE, AND THE
ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE HOLDING
COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF APPLICABLE,
FOR AN INTERMEDIATE HOLDING COMPANY, HAVE BEEN EXAMINED AND
APPROVED BY THE
ATTORNEY GENERAL IN
ACCORDANCE WITH THIS SECTION.
(B) THE SUPERINTENDENT
SHALL APPROVE A REORGANIZATION PLAN IF, UPON REVIEW, THE
SUPERINTENDENT FINDS ALL OF THE FOLLOWING:
(1) THE ADOPTION, APPROVAL, AND CONTENTS OF THE
REORGANIZATION PLAN COMPLY WITH SECTIONS 3913.25 TO 3913.37 OF
THE REVISED
CODE;
(2) THE MUTUAL INSURANCE COMPANY HAS PROPERLY FILED ALL
DOCUMENTS, FORMS, AND OTHER INFORMATION REQUIRED BY DIVISION
(G) OF SECTION 3913.26 OF THE
REVISED
CODE;
(3) THE REORGANIZATION PLAN IS FAIR AND EQUITABLE TO THE
MUTUAL INSURANCE COMPANY'S POLICYHOLDERS.
(C) THE SUPERINTENDENT
MAY RETAIN QUALIFIED EXPERTS, AT THE MUTUAL INSURANCE COMPANY'S
EXPENSE, TO ASSIST IN REVIEWING THE REORGANIZATION PLAN.
(D) THE SUPERINTENDENT
SHALL APPROVE OR REJECT A REORGANIZATION PLAN NOT LATER THAN
SIXTY DAYS AFTER THE LATER OF THE APPROVAL OF THE
REORGANIZATION PLAN BY THE MUTUAL INSURANCE COMPANY'S
POLICYHOLDERS OR THE COMPLETION OF PUBLIC HEARINGS HELD IN
ACCORDANCE WITH SECTION 3913.27 OF THE
REVISED
CODE. THE SUPERINTENDENT MAY
EXTEND THIS TIME PERIOD BY AN ADDITIONAL SIXTY DAYS BY
PROVIDING WRITTEN NOTICE TO THE MUTUAL INSURANCE COMPANY.
(E) UPON DECIDING TO
APPROVE OR TO REJECT A REORGANIZATION PLAN, THE SUPERINTENDENT
SHALL NOTIFY THE MUTUAL INSURANCE COMPANY OF THE DECISION BY
REGULAR MAIL. IF THE SUPERINTENDENT REJECTS A REORGANIZATION
PLAN, THE SUPERINTENDENT'S NOTICE SHALL DETAIL THE REASONS FOR
THE REJECTION.
(F) A MUTUAL INSURANCE
COMPANY SHALL FILE THE FOLLOWING DOCUMENTS WITH THE
SUPERINTENDENT WITHIN THIRTY DAYS AFTER RECEIVING NOTICE FROM
THE SUPERINTENDENT OF THE SUPERINTENDENT'S APPROVAL OF A
REORGANIZATION PLAN:
(1) THE MINUTES OF THE POLICYHOLDERS' MEETING AT WHICH
THE REORGANIZATION PLAN WAS APPROVED;
(2) THE ARTICLES OF INCORPORATION AND CODE OF REGULATIONS
FOR THE MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED
STOCK COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING
COMPANY, AS ADOPTED BY THE MUTUAL INSURANCE COMPANY'S
POLICYHOLDERS UNDER SECTION 3913.27 OF THE
REVISED
CODE.
(G)(1) A MUTUAL
INSURANCE COMPANY SHALL SUBMIT THE ARTICLES OF INCORPORATION FOR
THE MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK
COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING
COMPANY, AS ADOPTED BY THE MUTUAL INSURANCE COMPANY'S
POLICYHOLDERS UNDER SECTION 3913.27 OF THE
REVISED
CODE, TO THE ATTORNEY GENERAL
FOR THE ATTORNEY GENERAL'S EXAMINATION AND APPROVAL. IF, UPON
EXAMINATION, THE ATTORNEY GENERAL FINDS THAT THE ARTICLES OF
INCORPORATION ARE IN ACCORDANCE WITH APPLICABLE SECTIONS OF THE
REVISED
CODE, AND NOT INCONSISTENT WITH
THE CONSTITUTION AND LAWS OF THE
UNITED
STATES AND OF THIS STATE, THE
ATTORNEY GENERAL SHALL APPROVE OF THE ARTICLES OF INCORPORATION.
THE ATTORNEY GENERAL SHALL NOTIFY THE MUTUAL INSURANCE COMPANY
OF THE APPROVAL BY REGULAR MAIL.
(2) UPON OBTAINING THE APPROVALS OF THE SUPERINTENDENT
AND THE ATTORNEY GENERAL UNDER THIS SECTION, THE MUTUAL
INSURANCE COMPANY'S BOARD OF DIRECTORS SHALL FILE THE FOLLOWING
WITH THE SECRETARY OF STATE:
(a) A CERTIFICATE OF REORGANIZATION, SIGNED BY THE
CHAIRPERSON OF THE BOARD, THE PRESIDENT OR A VICE-PRESIDENT, AND
THE SECRETARY OR AN ASSISTANT SECRETARY OF THE MUTUAL INSURANCE
COMPANY. THE ARTICLES OF INCORPORATION FOR THE MUTUAL INSURANCE
HOLDING COMPANY AND THE REORGANIZED STOCK COMPANY, AND, IF
APPLICABLE, FOR AN INTERMEDIATE HOLDING COMPANY, AS ADOPTED BY
THE MUTUAL INSURANCE COMPANY'S POLICYHOLDERS UNDER SECTION
3913.27 OF THE REVISED
CODE, SHALL ACCOMPANY THE
CERTIFICATE OF REORGANIZATION.
(b) A STATEMENT, SIGNED BY THE CHAIRPERSON OF THE
BOARD, THE PRESIDENT OR A VICE-PRESIDENT, AND THE SECRETARY OR
AN ASSISTANT SECRETARY, OF THE MUTUAL INSURANCE COMPANY, OF THE
MANNER OF THE ADOPTION OF THE ARTICLES OF INCORPORATION FOR THE
MUTUAL INSURANCE HOLDING COMPANY AND THE REORGANIZED STOCK
COMPANY, AND, IF APPLICABLE, FOR AN INTERMEDIATE HOLDING
COMPANY;
(c) COPIES OF THE APPROVALS OBTAINED FROM THE
SUPERINTENDENT AND ATTORNEY GENERAL UNDER THIS SECTION.
(H) A REORGANIZATION
PLAN SHALL BE EFFECTIVE UPON THE FILING OF ALL OF THE DOCUMENTS
AND STATEMENTS REQUIRED BY DIVISION
(G) OF THIS SECTION, OR AT SUCH
LATER DATE AS THE CERTIFICATE OF REORGANIZATION MAY
PROVIDE.
(I) AFTER A
REORGANIZATION PLAN TAKES EFFECT, THE SUPERINTENDENT SHALL HAVE
JURISDICTION OVER THE MUTUAL INSURANCE HOLDING COMPANY, AND, IF
APPLICABLE, OVER AN INTERMEDIATE HOLDING COMPANY, IN ORDER TO
ENSURE THAT THE INTERESTS OF THE MUTUAL INSURANCE COMPANY'S
POLICYHOLDERS ARE PROTECTED.
Sec. 3913.29. (A)
PROPOSED AMENDMENTS TO THE ARTICLES OF INCORPORATION OF A MUTUAL
INSURANCE HOLDING COMPANY
MAY BE ADOPTED AT ANY MEMBERS' MEETING. THE BOARD OF DIRECTORS
OF A MUTUAL INSURANCE HOLDING COMPANY
SHALL PROVIDE NOTICE OF ANY MEMBERS' MEETING
CONDUCTING A VOTE ON THE ADOPTION OF AN AMENDMENT TO THE
ARTICLES OF INCORPORATION IN A NEWSPAPER OF GENERAL CIRCULATION
PUBLISHED IN THE COUNTY WHERE THE COMPANY'S PRINCIPAL PLACE OF
BUSINESS IS LOCATED, AT LEAST THIRTY DAYS PRIOR TO THE MEMBERS'
MEETING. WHERE THE AMENDMENT IS NOT INCONSISTENT WITH THE
CONSTITUTION AND LAWS OF THIS STATE AND OF THE
UNITED
STATES, THE AMENDMENT MAY BE
ADOPTED BY THE AFFIRMATIVE VOTE OF AT LEAST THREE-FIFTHS OF THE
MEMBERS PRESENT AND VOTING AT THE MEETING. AFTER ADOPTING AN
AMENDMENT, THE BOARD OF DIRECTORS SHALL SUBMIT THE AMENDMENT
WITH THE ATTORNEY GENERAL FOR EXAMINATION AND APPROVAL.
(B) IF, UPON
EXAMINATION, THE ATTORNEY GENERAL FINDS THAT THE AMENDMENTS
ADOPTED AT THE MEMBERS' MEETING ARE IN ACCORDANCE WITH
APPLICABLE SECTIONS OF THE
REVISED
CODE, AND ARE NOT INCONSISTENT
WITH THE CONSTITUTION AND LAWS OF THE
UNITED
STATES AND OF THIS STATE, THE
ATTORNEY GENERAL SHALL APPROVE OF THE AMENDMENT TO THE ARTICLES
OF INCORPORATION.
(C) UPON RECEIVING THE
APPROVAL OF THE ATTORNEY GENERAL, THE AMENDMENT AND A
CERTIFICATE OF THE ATTORNEY GENERAL'S APPROVAL SHALL BE FILED IN
THE OFFICE OF THE SECRETARY OF STATE, AND SHALL THEREUPON BE IN
EFFECT. AFTER RECORDING THE AMENDMENT, THE SECRETARY OF STATE
SHALL DEPOSIT A COPY THEREOF WITH THE SUPERINTENDENT OF
INSURANCE.
Sec. 3913.30. (A) UPON
A REORGANIZATION PLAN TAKING EFFECT IN ACCORDANCE WITH SECTION
3913.28 OF THE REVISED
CODE, THE CORPORATE EXISTENCE
OF THE MUTUAL INSURANCE COMPANY SHALL CONTINUE IN THE
REORGANIZED STOCK COMPANY. ON THE EFFECTIVE DATE OF THE
REORGANIZATION, ALL OF THE ASSETS, RIGHTS, FRANCHISES, AND
INTERESTS OF THE MUTUAL INSURANCE COMPANY IN AND TO EVERY
SPECIES OF PROPERTY, WHETHER REAL, PERSONAL, OR MIXED, AND ANY
ACCOMPANYING CHOSES IN ACTION, SHALL BE VESTED IN THE
REORGANIZED STOCK COMPANY, WITHOUT ANY DEED OR TRANSFER, AND THE
REORGANIZED STOCK COMPANY SHALL ASSUME ALL THE OBLIGATIONS AND
LIABILITIES OF THE MUTUAL INSURANCE COMPANY.
(B) UNLESS OTHERWISE
SPECIFIED IN A REORGANIZATION PLAN, THOSE PERSONS WHO ARE THE
DIRECTORS AND OFFICERS OF A MUTUAL INSURANCE COMPANY ON THE
EFFECTIVE DATE OF THE REORGANIZATION SHALL SERVE AS THE
DIRECTORS AND OFFICERS OF THE REORGANIZED STOCK COMPANY UNTIL
NEW DIRECTORS AND OFFICERS ARE ELECTED PURSUANT TO THE
REORGANIZED STOCK COMPANY'S ARTICLES OF INCORPORATION AND CODE
OF REGULATIONS.
Sec. 3913.31. ALL COSTS AND EXPENSES OF THE PROCESS OF A
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE SHALL BE PAID FOR OR
REIMBURSED BY THE MUTUAL INSURANCE COMPANY, THE REORGANIZED
STOCK COMPANY, OR AN INTERMEDIATE HOLDING COMPANY.
Sec. 3913.32. (A) A
MUTUAL INSURANCE COMPANY MAY REORGANIZE BY MERGING ITS
POLICYHOLDERS' MEMBERSHIP INTERESTS INTO A DOMESTIC OR FOREIGN
MUTUAL INSURANCE HOLDING COMPANY AND CONTINUING THE CORPORATE
EXISTENCE OF THE MUTUAL INSURANCE COMPANY AS A REORGANIZED STOCK
COMPANY. A MUTUAL INSURANCE COMPANY REORGANIZING UNDER THIS
SECTION SHALL COMPLY WITH ALL APPLICABLE PROVISIONS OF SECTIONS
3913.25 TO 3913.37 OF THE
REVISED
CODE, AND ALL APPLICABLE LAWS
OF FOREIGN JURISDICTIONS, TO EFFECT THE REORGANIZATION.
(B) A DOMESTIC OR
FOREIGN MUTUAL INSURANCE HOLDING COMPANY MAY REORGANIZE BY
MERGING OR CONSOLIDATING ITS MEMBERSHIP INTERESTS INTO ANOTHER
DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY. A
DOMESTIC OR FOREIGN MUTUAL INSURANCE HOLDING COMPANY
REORGANIZING UNDER THIS DIVISION SHALL COMPLY WITH ALL
APPLICABLE PROVISIONS OF SECTIONS 3913.25 TO
3913.37 OF THE REVISED
CODE, AND ALL APPLICABLE LAWS
OF FOREIGN JURISDICTIONS, TO EFFECT THE REORGANIZATION.
Sec. 3913.33. A MEMBERSHIP INTEREST IN A MUTUAL INSURANCE
HOLDING COMPANY IS NOT A SECURITY UNDER THE LAWS OF THIS STATE.
NO MEMBER OF A MUTUAL INSURANCE HOLDING COMPANY MAY TRANSFER
MEMBERSHIP IN THE MUTUAL INSURANCE HOLDING COMPANY OR ANY RIGHT
ARISING FROM MEMBERSHIP.
Sec. 3913.34. (A)
SECTIONS 3913.11 TO 3913.13 AND 3913.20 TO 3913.23 OF THE
REVISED
CODE SHALL APPLY TO A MUTUAL
INSURANCE HOLDING COMPANY AS IF THE MUTUAL INSURANCE HOLDING
COMPANY WERE A DOMESTIC MUTUAL INSURANCE COMPANY. THE MEMBERS
OF THE MUTUAL INSURANCE HOLDING COMPANY ARE DEEMED TO BE MEMBERS
OF A DOMESTIC MUTUAL INSURANCE COMPANY FOR ALL PURPOSES OF SUCH
SECTIONS.
(B) A REORGANIZATION OF
A DOMESTIC MUTUAL LIFE INSURANCE COMPANY SUBJECT TO SECTIONS
3913.25 TO 3913.37 OF THE
REVISED
CODE ALSO IS SUBJECT TO
SECTIONS 3907.09 TO 3907.11 OF THE
REVISED
CODE, IF APPLICABLE, BUT IS NOT
SUBJECT TO SECTIONS 3901.32 TO 3901.323 OF THE
REVISED
CODE.
(C) NOTWITHSTANDING
DIVISION (B) OF THIS SECTION,
FOR A PERIOD OF FIVE YEARS FOLLOWING THE EFFECTIVE DATE OF A
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE, NO PERSON SHALL ACQUIRE
CONTROL OF A REORGANIZED STOCK COMPANY WITHOUT COMPLIANCE WITH
SECTIONS 3901.32 TO 3901.323 OF THE
REVISED
CODE. FOR PURPOSES OF THIS
DIVISION, "CONTROL" HAS THE SAME MEANING AS IN DIVISION
(B) OF SECTION 3901.32 OF THE
REVISED
CODE, EXCEPT THAT CONTROL IS
PRESUMED TO EXIST IF ANY PERSON, DIRECTLY OR INDIRECTLY, OWNS,
CONTROLS, HOLDS WITH THE POWER TO VOTE, OR HOLDS PROXIES
REPRESENTING FIVE PER CENT OR MORE OF THE VOTING SECURITIES OF
ANY OTHER PERSON.
(D) A MUTUAL
INSURANCE HOLDING COMPANY, AND AN INTERMEDIATE HOLDING COMPANY,
IF ANY, ARE DEEMED TO BE INSURERS SUBJECT TO SECTIONS 3901.07,
3901.071, AND 3901.48 OF THE
REVISED
CODE.
Sec. 3913.35. (A) A MUTUAL INSURANCE HOLDING
COMPANY, AND, IF APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY,
ARE DEEMED TO BE INSURERS SUBJECT TO
SECTIONS 3903.01 TO 3903.76 OF THE
REVISED
CODE. A MUTUAL INSURANCE
HOLDING COMPANY AND THE INTERMEDIATE HOLDING COMPANY ACCORDINGLY
ARE DEEMED TO BE PARTIES TO ANY PROCEEDING UNDER
SECTIONS 3903.01 TO 3903.76 OF THE
REVISED
CODE INVOLVING AN INSURANCE
COMPANY THAT IS A SUBSIDIARY OF THE MUTUAL INSURANCE HOLDING
COMPANY OR OF THE INTERMEDIATE HOLDING COMPANY AS A RESULT OF A
REORGANIZATION UNDER SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE.
(B) IN ANY PROCEEDING
UNDER SECTIONS 3903.01 TO 3903.76 OF THE
REVISED
CODE INVOLVING A REORGANIZED
STOCK COMPANY, THE ASSETS OF THE MUTUAL INSURANCE HOLDING
COMPANY, AND, IF APPLICABLE, ITS INTERMEDIATE HOLDING COMPANY,
ARE DEEMED TO BE ASSETS OF THE REORGANIZED STOCK COMPANY FOR
PURPOSES OF SATISFYING CLAIMS OF THE POLICYHOLDERS OF THE
REORGANIZED STOCK COMPANY.
(C) A MUTUAL INSURANCE
HOLDING COMPANY, AND, IF APPLICABLE, ITS INTERMEDIATE HOLDING
COMPANY, SHALL NOT BE DISSOLVED OR LIQUIDATED WITHOUT COMPLIANCE
WITH THE PROVISIONS OF CHAPTER
3903. OF THE REVISED
CODE. SUCH COMPANIES ARE
DEEMED TO BE DOMESTIC INSURANCE COMPANIES FOR PURPOSES OF A
DISSOLUTION OR LIQUIDATION UNDER
CHAPTER 3903. OF THE
REVISED
CODE.
Sec. 3913.36. ANY ACTION CHALLENGING THE VALIDITY OF, OR
ARISING OUT OF, ACTIONS TAKEN OR PROPOSED TO BE TAKEN IN
CONNECTION WITH A REORGANIZATION UNDER SECTIONS 3913.25 TO
3913.37 OF THE REVISED
CODE SHALL BE COMMENCED NO
LATER THAN THIRTY DAYS AFTER THE EFFECTIVE DATE OF THE
REORGANIZATION.
Sec. 3913.37. THE SUPERINTENDENT OF INSURANCE MAY ADOPT
RULES IN ACCORDANCE WITH
CHAPTER 119. OF THE
REVISED
CODE TO CARRY OUT THE PURPOSES
OF SECTIONS 3913.25 TO 3913.37 OF THE
REVISED
CODE.
Sec. 3913.31 3913.40. (A) Any insurer that is organized
under the
laws of another state and is admitted to transact the business of
insurance in this state may become a domestic insurer by
complying with all of the requirements of law relative to the
organization and licensing of a domestic insurer of the same type
and by designating its principal place of business at a place in
this state. Such a domestic insurer shall be issued like
certificates and licenses to transact business in this state, is
subject to the jurisdiction of this state, and shall be
recognized as an insurer formed under the laws of this state as
of the date of its original incorporation in its original
domiciliary state. The superintendent of insurance shall approve
any proposed transfer of domicile under this division unless he
determines that the transfer is not in the interest of
policyholders of this state.
(B) Any domestic insurer, upon the approval of the
superintendent, may transfer its domicile to any other state in
which it is admitted to transact the business of insurance. Upon
such a transfer, the insurer shall cease to be a domestic
insurer, and shall be admitted to this state if qualified as a
foreign insurer. The superintendent shall approve any proposed
transfer of domicile under this division unless he determines
that the transfer is not in the interest of policyholders of this
state.
(C)(1) With respect to any insurer that is licensed to
transact the business of insurance in this state and that
transfers its domicile to this or any other state by merger,
consolidation, or any other lawful method, both of the following
apply:
(a) The certificate of authority, agents appointments and
licenses, rates, and other items as allowed by the superintendent
that are in existence at the time of the transfer shall continue
in effect upon the transfer if the insurer remains qualified to
transact the business of insurance in this state.
(b) All outstanding policies shall remain in effect and
need not be endorsed as to the new name of the company or its new
location unless so ordered by the superintendent.
(2) Every transferring insurer as described in division
(C)(1) of this section shall file new policy forms with the
superintendent on or before the effective date of the transfer,
but may use existing policy forms with appropriate endorsements
if allowed by, and under such conditions as are approved by, the
superintendent. Every such insurer shall notify the
superintendent of the details of the proposed transfer, and shall
file promptly any resulting amendments to corporate documents
filed or required to be filed with the superintendent.
(D) The superintendent, in accordance with Chapter 119. of
the Revised Code, may adopt rules to carry out the purposes of
this section.
Section 2. That existing sections 3901.043 and 3913.31 of the Revised Code are
hereby repealed.
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