§237.4. Plan of reorganization

A. A reorganizing mutual seeking to reorganize pursuant to the provisions of this Subpart shall submit a proposed plan of reorganization to the commissioner. The plan of reorganization shall include the following:

(1) A statement analyzing the benefits and risks attendant to the proposed reorganization, including the rationale for the reorganization.

(2) A statement indicating how the reorganization will protect the immediate and long-term interests, and serve the best interests of policyholders.

(3) Copies of the articles of incorporation and bylaws of the reorganized company and any affiliate parent corporation, stockholding companies, and reorganized insurers.

(4) Information sufficient to demonstrate that the financial condition of any reorganized insurer will not be diminished upon reorganization.

(5) A description of any plans for the initial sale of stock of the reorganizing mutual or any parent corporation or affiliate stockholding company.

B. The plan of reorganization shall:

(1) Provide that all membership interests in the reorganizing mutual shall be extinguished as of the effective date.

(2) Require the distribution of consideration, in a fair and equitable manner, to all eligible members upon extinguishment of the membership interests.

(3) Specify the manner in which the aggregate value of the consideration shall be determined and the method by which the consideration shall be allocated among eligible members.

(4) Provide dividend protections for the reasonable dividend expectations, if any, of policyholders of any reorganized insurer, all as set forth in R.S. 22:237.5.

C. The plan of reorganization shall have been duly adopted by action of not less than two-thirds of the members of the entire board of directors of the reorganizing mutual.

D. A plan of reorganization filed with the commissioner pursuant to this Section shall be accompanied by the proposed forms of notice required by R.S. 22:237.6(C) and 237.7(C).

E. All information, documents, and copies thereof obtained by or disclosed to the commissioner, the Department of Insurance, or its designated representative in the course of an examination of a proposed plan of reorganization shall be treated in accordance with R.S. 22:706.

Acts 2009, No. 234, §1.