§ 8019 — Conversion of mutual holding company

§ 8019. Conversion of mutual holding company. (a) A mutual holding\ncompany may reorganize in accordance with a plan of reorganization which\nis fair and equitable to the company's members and is:\n (1) adopted by action of three-fourths of its entire board of\ndirectors;\n (2) approved by the superintendent if found by the superintendent to\nbe fair and equitable to the company's members after a hearing held upon\nnotice to the company's members; and, thereafter,\n (3) adopted by the affirmative vote of two-thirds of all votes cast by\nmembers of the company entitled to vote, after notice being given to all\nmembers entitled to vote. The mutual holding company shall give written\nnotice stating the date, time and place for voting on such proposal to\nmembers entitled to notice of and to vote on the proposal in accordance\nwith this section, sent by mail or electronic transmission to the last\nknown mailing or electronic addresses of such policyholders as shown on\nthe records of the mutual holding company. Such notice shall be sent at\nleast thirty days before the date of the proposed vote to approve the\nplan of reorganization. Such notice may be combined with notice of the\nhearing required by paragraph two of this subsection. Such notice shall\nbe preceded or accompanied by a true and correct copy of the plan, or by\na summary thereof approved by the superintendent, and such other\nexplanatory information as the superintendent shall approve or require.\n (b) A plan of reorganization pursuant to subsection (a) of this\nsection shall provide for the membership interests in the mutual holding\ncompany being extinguished and may provide either for:\n (1) the conversion of the mutual holding company into a stock\ncorporation, in which event consideration distributed shall be equal to\nthat required under section seven thousand three hundred twelve of this\nchapter or such other law governing the demutualization of mutual life\ninsurers as may then be in effect; or\n (2) the distribution to eligible members of the mutual holding company\nof consideration consisting of all assets of the mutual holding company\nincluding all stock of the reorganized insurer or any stock holding\ncompany owned by the mutual holding company, or other consideration\nhaving equivalent aggregate value, which may be in the form of cash,\nsecurities of any institution, additional insurance or annuity benefits\nor policy credits, increased dividends or other consideration, all such\nconsideration being allocated among eligible members of the mutual\nholding company in a manner that is fair and equitable to the company's\nmembers.\n (c) If no closed block of participating policies and contracts was\nestablished or alternative provision was approved pursuant to section\neight thousand three of this article when the mutual holding company was\nestablished or thereafter, then the plan of reorganization of the mutual\nholding company pursuant to subsection (a) of this section shall provide\nfor the establishment of such a closed block or alternative provision\nupon a reorganization of the mutual holding company under this section.\nAny such closed block or alternative provisions shall be subject to\nsubsection (b) of section eight thousand three of this article. However,\nif a closed block of participating policies and contracts was\nestablished or alternative provision was approved pursuant to subsection\n(b) of section eight thousand three of this article when the mutual\nholding company was established or thereafter, then no such closed block\nor alternative provision shall be required upon a reorganization of the\nmutual holding company under this section.\n