§ 628.711 — Plan of reorganization

Florida § 628.711

• Jurisdiction: Florida
• Title: XXXVII
• Ch. 628: STOCK AND MUTUAL INSURERS; HOLDING COMPANIES

Text

(1) A plan of reorganization shall include the following provisions: (a) A description of the structure of the mutual insurance holding company system consistent with the requirements therefor set forth in this act. (b) A description of the qualifications for membership in and the rights of members of the mutual insurance holding company consistent with the requirements therefor set forth in this act. (c) A description of the transactions, and parties to such transactions, that will effect the reorganization, including, but not limited to, transfer and assumption of policies, contracts, assets, and liabilities. (d) A description of corporate restructuring and other corporate transactions that will effect the reorganization, including, but not limited to, organization of companies, amendment or restatement of articles of incorporation or bylaws, and mergers and consolidations. (e) A description of those persons who shall serve as directors and officers of the mutual insurance holding company, its intermediate stock holding companies, if any, its controlled subsidiaries, and other subsidiaries as of the effective date of the reorganization. The initial directory shall be the directors of the mutual insurance company who shall have terms concurrent with the terms as directors of the reorganized mutual insurance company unless otherwise specified in the plan. (f) A representation that, following the reorganization, the material terms and conditions of indemnification or coverage of policyholders of the mutual insurance company shall remain in full force and effect under policies transferred to and assumed by one or more subsidiaries of the mutual insurance holding company or retained by a mutual insurance company that has reorganized either as a mutual insurance holding company that elects to write insurance or a stock subsidiary. (g) A representation that, following the reorganization, the material terms and conditions of subordinated surplus notes and other contractual obligations, other than those arising under policies described in paragraph (f), of the mutual insurance company shall, subject to the rights of the mutual insurance company under applicable law, and to the extent such obligations are not otherwise satisfied or terminated in accordance with their terms or retained by a mutual insurance holding company or controlled subsidiary, remain in full force and effect upon the transfer of such obligations to, and assumption of such obligations by, one or more subsidiaries of the mutual insurance holding company.

(2) A plan of reorganization must be adopted by the board of directors of the mutual insurance company or, in the case of the formation of any intermediate stock insurance holding company that is not concurrent with the formation of the mutual insurance holding company, by the board of directors of the mutual insurance holding company.

(3) Following the adoption of a plan of reorganization, and prior to the meeting of the mutual insurance company members to approve the plan, the mutual insurance company shall submit to the office the following: (a) The plan of reorganization, as adopted. (b) The form of notice to be sent to the mutual insurance company members, informing them of their right to vote on the plan of reorganization. (c) The form of proxy statement to be sent to the mutual insurance company members, informing them of their right to vote by proxy on the plan of reorganization, and describing the plan. (d) The form of proxy to be sent to the mutual insurance company members to solicit their vote on the plan of reorganization. (e) Proposed articles of incorporation, merger, or consolidation, restatements of or amendments to articles of incorporation or bylaws, and plans of merger or consolidation, with respect to each entity to be organized, reorganized, or otherwise subject to such action under the plan of reorganization. (f) A proposed business plan for the 3 years following the date of the reorganization. (g) An audited financial statement prepared on a statutory basis consistent with the Florida Insurance Code, including an actuarial opinion for the most recent calendar year ended, or a copy thereof, if the statement was previously filed with the office.

(4) The office may hold a public hearing to allow public comment on the plan of reorganization. Any hearing must be held within 30 days after receipt by the office of a completed plan of reorganization. The office may not approve a plan of reorganization unless it finds that it is fair and equitable to the members of the mutual insurance company. Ninety days after filing, the plan of reorganization shall be deemed approved unless it has previously been approved or disapproved by the office. The office shall inform the mutual insurer of the specific reasons for the disapproval of any plan of reorganization.

(5)(a) A plan of reorganization adopted by the board of directors of the applicant may be: 1. Amended by the board of directors of the applicant in response to the comments or recommendations of the office, or any other state or federal agency or governmental entity, before any solicitation of proxies from members of the mutual insurance company to vote on the plan of reorganization, or at any time with the consent of the office, except that any material amendment after the members’ approval shall require the members’ approval; or 2. Terminated by the board of directors of the applicant at any time before members of the mutual insurance company vote on the plan of reorganization and, otherwise, at any time with the consent of the office. (b) The plan of reorganization is approved upon the affirmative vote of at least a majority of the votes cast by members of the mutual insurance company, notwithstanding quorum or voting action requirements otherwise applicable to the mutual insurance company to the contrary. (c) Within 30 days after members have approved the plan of reorganization, the applicant must file with the office the minutes of the meeting at which the plan of reorganization was approved.

Legislative History

s. 1, ch. 97-216; s. 1299, ch. 2003-261.