§ 33-14-125 — Upon division becoming effective; rights upon division; requirement for new financing statement; distributions

Georgia § 33-14-125

• Jurisdiction: Georgia
• Title: 33

Text

(a) When a division becomes effective pursuant to subsection (d) of Code Section 33-14-124 : (1) If the dividing insurer has survived the division: (A) It continues to exist; (B) Its articles of incorporation, if any, shall be amended as provided in the plan of division; and (C) Its bylaws, if any, shall be amended as provided in the plan of division; (2) If the dividing insurer has not survived the division, its separate existence ceases to exist; (3) Each new insurer: (A) Comes into existence; (B) Shall hold any capital, surplus, and other property allocated to it as a successor to the dividing insurer, and not by transfer, whether directly or indirectly; and (C) Its articles of incorporation and bylaws shall be effective; (4) Capital, surplus, and other property of the dividing insurer: (A) That is allocated by the plan of division either: (i) Vests in the new insurers as provided in the plan of division; or (ii) Remains vested in the dividing insurer; (B) That is not allocated by the plan of division: (i) Remains vested in the dividing insurer, if the dividing insurer survives the division; or (ii) Is allocated to and vests equally in the resulting insurers as tenants in common, if the dividing insurer does not survive the division; or (C) Vests as provided in this subsection without transfer, reversion, or impairment; (5) A resulting insurer to which a cause of action is allocated as provided in paragraph (4) of this subsection may be substituted or added in any pending action or proceeding to which the dividing insurer is a party when the division becomes effective; (6) The policies and other liabilities of the dividing insurer are allocated among the resulting insurers as provided in Code Section 33-14-126 and the resulting insurers to which policies or other liabilities are allocated are liable for those policies and other liabilities as successors to the dividing insurer, and not by transfer, whether directly or indirectly; (7) Any division that becomes effective pursuant to subsection (d) of Code Section 33-14-124 shall not be deemed to constitute an assignment of any insurance policy, annuity, reinsurance agreement, or any other type of contract under the laws of this state; and (8) The shares in the dividing insurer that are to be converted or canceled in the division are converted or canceled, and the shareholders of those shares are entitled only to the rights provided to them under the plan of division and any appraisal rights they may have pursuant to Code Section 33-14-127 . (b) Except as provided in the articles of incorporation or bylaws of the dividing insurer, the division shall not give rise to any rights that a director, shareholder, or third party would have upon a dissolution, liquidation, or winding up of the dividing insurer. (c) The allocation to a new insurer of capital, surplus, or other property that is collateral covered by an effective financing statement shall not be effective until a new financing statement naming the new insurer as a debtor is effective under Articles 1 through 9 of Title 11. (d) Unless otherwise provided in the plan of division, the interests in and any shares of each new insurer shall be distributed to: (1) The dividing insurer, if it survives the division; or (2) The shareholders of the shares of the dividing insurer that do not assert appraisal rights, pro rata, if the dividing insurer does not survive the division.

Legislative History

Added by 2019 Ga. Laws 147,§ 1, eff. 7/1/2019.