S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8164
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             October 18, 2023
                                ___________
 
 Introduced by M. of A. WEPRIN -- read once and referred to the Committee
   on Insurance
 
 AN ACT to amend the insurance law, in relation to the formation of mutu-
   al  holding  companies  by  certain  domestic mutual property/casualty
   insurers and the reorganization in connection therewith of a  domestic
   mutual    property/casualty    insurer    into    a   domestic   stock
   property/casualty insurer
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. The insurance law is amended by adding a new article 81 to
 read as follows:
                                ARTICLE 81
             MUTUAL HOLDING COMPANY; PROPERTY/CASUALTY INSURER
 SECTION 8101. DEFINITIONS.
         8102. REORGANIZATION OF MUTUAL PROPERTY/CASUALTY INSURER THROUGH
                 FORMATION OF A MUTUAL HOLDING COMPANY; CONTENTS OF PLAN.
         8103. DIVIDEND PRACTICES.
         8104. ADOPTION OF PLAN; SUBMISSION OF PLAN  TO  THE  SUPERINTEN-
                 DENT.
         8105. AMENDMENT OR WITHDRAWAL OF PLAN.
         8106. CONSULTANTS.
         8107. APPROVAL OF PLAN BY SUPERINTENDENT; HEARING.
         8108. APPROVAL OF PLAN BY ELIGIBLE MEMBERS.
         8109. FILING OF PLAN; EFFECTIVE DATE OF REORGANIZATION.
         8110. EFFECT OF REORGANIZATION.
         8111. CORPORATE EXISTENCE.
         8112. DIRECTORS AND OFFICERS.
         8113. NOTICE OF PROPOSED REORGANIZATION.
         8114. FAILURE TO GIVE NOTICE.
         8115. LIMITATIONS OF ACTIONS; SECURITY.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD07348-01-3
 A. 8164                             2
              

 
         8116. PROHIBITED TRANSACTIONS BY OFFICERS, DIRECTORS AND EMPLOY-
                 EES.
         8117. REQUIREMENTS APPLICABLE TO A MUTUAL HOLDING COMPANY.
         8118. OTHER  REQUIREMENTS  APPLICABLE  TO  AN INTERMEDIATE STOCK
                 HOLDING COMPANY AND A MUTUAL HOLDING COMPANY.
         8119. CONVERSION OF MUTUAL HOLDING COMPANY.
         8120. TRANSFERS OF SUBSIDIARIES.
   § 8101. DEFINITIONS. AS USED IN  THIS  ARTICLE,  THE  FOLLOWING  TERMS
 SHALL HAVE THE FOLLOWING MEANINGS:
   (A) "ADOPTION DATE" MEANS THE DATE THE BOARD OF DIRECTORS OF THE MUTU-
 AL PROPERTY/CASUALTY INSURER ADOPTS THE PLAN OF REORGANIZATION.
   (B)  "BENEFICIAL  OWNERSHIP"  WITH  RESPECT TO ANY SECURITY, MEANS THE
 SOLE OR SHARED POWER TO VOTE OR DIRECT  THE  VOTING  OF,  SUCH  SECURITY
 AND/OR  THE SOLE OR SHARED POWER TO DISPOSE OR DIRECT THE DISPOSITION OF
 SUCH SECURITY.
   (C) "EFFECTIVE DATE" MEANS, IN THE CASE OF  THE  REORGANIZATION  OF  A
 MUTUAL PROPERTY/CASUALTY INSURER, THE DATE UPON WHICH THE REORGANIZATION
 OF THE MUTUAL PROPERTY/CASUALTY INSURER SHALL BE EFFECTIVE IN ACCORDANCE
 WITH SECTION EIGHT THOUSAND ONE HUNDRED NINE OF THIS ARTICLE AS A RESULT
 OF REORGANIZATION PROCEEDINGS PURSUANT TO THIS ARTICLE.
   (D)  "ELIGIBLE  MEMBER"  WITH  REFERENCE TO A MUTUAL PROPERTY/CASUALTY
 INSURER,  MEANS  A  PERSON  WHO,  BY   THE   RECORDS   OF   THE   MUTUAL
 PROPERTY/CASUALTY INSURER, IS DEEMED TO BE THE "POLICYHOLDER" OF A POLI-
 CY  OR CONTRACT WHICH IS OF A TYPE OF ANY ONE OR MORE OF THE BASIC KINDS
 OF INSURANCE SPECIFIED  IN  SUBSECTION  (A)  OF  SECTION  FOUR  THOUSAND
 HUNDRED  ONE  OF  THIS CHAPTER FOR PURPOSES OF SECTION FOUR THOUSAND ONE
 HUNDRED SIXTEEN OF THIS CHAPTER  AS  OF  THE  ADOPTION  DATE.  A  PERSON
 INSURED  UNDER  A GROUP POLICY IS NOT AN ELIGIBLE MEMBER. A PERSON WHOSE
 POLICY BECOMES EFFECTIVE ONE CALENDAR DAY AFTER THE BOARD  OF  DIRECTORS
 ADOPTS  THE PLAN OF CONVERSION BUT BEFORE THE EFFECTIVE DATE OF THE PLAN
 OF CONVERSION IS NOT AN ELIGIBLE MEMBER.
   (E) "MEMBER" MEANS A MEMBER OF SUCH MUTUAL HOLDING COMPANY AS PROVIDED
 IN SUBSECTION (C) OF SECTION EIGHT THOUSAND  ONE  HUNDRED  SEVENTEEN  OF
 THIS ARTICLE.
   (F)  "MEMBERSHIP  INTERESTS"  MEANS,  WITH REFERENCE TO AN INSTITUTION
 THAT IS A MUTUAL PROPERTY/CASUALTY INSURER OR A MUTUAL HOLDING  COMPANY,
 THE  RIGHTS  AS MEMBERS ARISING UNDER THE CHARTER OF SUCH INSTITUTION OR
 THIS CHAPTER OR OTHERWISE BY LAW INCLUDING THE RIGHTS  TO  VOTE  AND  TO
 PARTICIPATE  IN  ANY  DISTRIBUTION  OF  THE SURPLUS OF SUCH INSTITUTION,
 WHETHER OR NOT INCIDENT TO A LIQUIDATION THEREOF. THE  TERM  "MEMBERSHIP
 INTERESTS"  DOES NOT INCLUDE RIGHTS EXPRESSLY CONFERRED UPON THE POLICY-
 HOLDERS BY THEIR POLICIES OR CONTRACTS (INCLUDING THE RIGHT  TO  PARTIC-
 IPATE IN THE DISTRIBUTION OF SURPLUS) OTHER THAN THE RIGHT TO VOTE.
   (G)  "MUTUAL  HOLDING  COMPANY"  MEANS  A  CORPORATION ORGANIZED UNDER
 SECTION EIGHT THOUSAND ONE HUNDRED SEVENTEEN OF THIS ARTICLE.
   (H) "MUTUAL PROPERTY/CASUALTY INSURER" FOR THE PURPOSES OF THIS  ARTI-
 CLE  MEANS  A DOMESTIC MUTUAL PROPERTY/CASUALTY INSURANCE COMPANY ORGAN-
 IZED UNDER ARTICLE TWELVE OF THIS CHAPTER  AND  LICENSED  UNDER  ARTICLE
 FORTY-ONE  OF  THIS  CHAPTER,  OR A DOMESTIC ADVANCE PREMIUM CORPORATION
 ORGANIZED AND LICENSED UNDER ARTICLE SIXTY-SIX OF THIS  CHAPTER,  OR  AN
 ASSESSMENT CORPORATION ORGANIZED AND LICENSED UNDER ARTICLE SIXTY-SIX OF
 THIS CHAPTER.
   (I) "OFFER" INCLUDES EVERY OFFER TO BUY OR ACQUIRE, SOLICITATION OF AN
 OFFER TO SELL, TENDER OFFER FOR, OR REQUEST OR INVITATION FOR TENDERS OF
 A SECURITY OR INTEREST IN A SECURITY FOR VALUE.
   (J) "OUTSIDE DIRECTOR" MEANS A DIRECTOR:
 A. 8164                             3
 
   (1)  WHO IS NOT AN OFFICER, EMPLOYEE OR CONSULTANT OF THE MUTUAL HOLD-
 ING COMPANY, ANY STOCK HOLDING COMPANY, THE REORGANIZED INSURER  OR  ANY
 OTHER  SUBSIDIARY  OF  THE  MUTUAL  HOLDING COMPANY OR ANY STOCK HOLDING
 COMPANY;
   (2)  WHO  DOES  NOT  DIRECTLY  OR  INDIRECTLY OWN, CONTROL OR HOLD ONE
 PERCENT OR GREATER OF THE VOTING SECURITIES OF ANY STOCK HOLDING  COMPA-
 NY,  THE REORGANIZED INSURER OR ANY OTHER SUBSIDIARY OF THE MUTUAL HOLD-
 ING COMPANY OR ANY STOCK HOLDING COMPANY; AND
   (3) WHO IS NOT A DIRECTOR, OFFICER OR EMPLOYEE OF  ANY  PERSON  EXCEPT
 THE MUTUAL HOLDING COMPANY OR ANY STOCK HOLDING COMPANY THAT DIRECTLY OR
 INDIRECTLY  OWNS, CONTROLS OR HOLDS SUCH PERCENTAGE OF SUCH VOTING SECU-
 RITY. LESSER AMOUNTS OF OWNERSHIP OF VOTING SECURITIES OTHER THAN  THOSE
 PROVIDED FOR IN THIS SUBSECTION MAY BE APPROVED BY THE SUPERINTENDENT AS
 A  COMPONENT  OF  THE  MUTUAL  HOLDING  COMPANY'S PLAN OF REORGANIZATION
 PURSUANT TO THIS ARTICLE.
   (K) "PERSON" MEANS  AN  INDIVIDUAL,  PARTNERSHIP,  FIRM,  ASSOCIATION,
 CORPORATION,  JOINT-STOCK  COMPANY,  LIMITED  LIABILITY COMPANY, LIMITED
 LIABILITY PARTNERSHIP, TRUST, GOVERNMENT OR GOVERNMENTAL  AGENCY,  STATE
 OR  POLITICAL SUBDIVISION THEREOF, PUBLIC OR PRIVATE CORPORATION, BOARD,
 ASSOCIATION, ESTATE, TRUSTEE OR FIDUCIARY, ANY  SIMILAR  ENTITY  OR  ANY
 COMBINATION OF THE FOREGOING ACTING IN CONCERT.
   (L) "PLAN OF REORGANIZATION" OR "PLAN" MEANS A PLAN ADOPTED BY A MUTU-
 AL PROPERTY/CASUALTY INSURER IN COMPLIANCE WITH THIS ARTICLE.
   (M)  "POLICYHOLDER"  MEANS  A PERSON WHO, BY THE RECORDS OF THE MUTUAL
 PROPERTY/CASUALTY INSURER, IS DEEMED TO BE THE POLICYHOLDER OF A  POLICY
 OR  CONTRACT WHICH IS OF A TYPE OF ANY ONE OR MORE OF THE BASIC KINDS OF
 INSURANCE SPECIFIED IN SUBSECTION  (A)  OF  SECTION  FOUR  THOUSAND  ONE
 HUNDRED  ONE  OF  THIS CHAPTER FOR PURPOSES OF SECTION FOUR THOUSAND ONE
 HUNDRED SIXTEEN OF THIS CHAPTER.
   (N) "PUBLIC OFFERING" MEANS A STOCK OFFERING REQUIRED TO BE REGISTERED
 PURSUANT TO THE SECURITIES ACT OF 1933, UNITED STATES  CODE,  TITLE  15,
 SECTION 77E.
   (O)  "REORGANIZED  STOCK  INSURER"  MEANS  THE STOCK PROPERTY/CASUALTY
 INSURER INTO WHICH A MUTUAL PROPERTY/CASUALTY INSURER HAS BEEN  REORGAN-
 IZED IN ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE.
   (P) "REORGANIZING INSURER" MEANS, IN THE CASE OF A PLAN OF REORGANIZA-
 TION OF A MUTUAL PROPERTY/CASUALTY INSURER UNDER THIS ARTICLE, THE MUTU-
 AL PROPERTY/CASUALTY INSURER THAT IS REORGANIZING PURSUANT TO SUCH PLAN.
   (Q)  "INTERMEDIATE STOCK HOLDING COMPANY" MEANS A CORPORATION INCORPO-
 RATED UNDER THE LAWS OF ANY JURISDICTION IN THE UNITED STATES, AT  LEAST
 FIFTY-ONE  PERCENT  OF  THE  VOTING STOCK OF WHICH IS OWNED, DIRECTLY OR
 THROUGH ANOTHER INTERMEDIATE STOCK HOLDING COMPANY, BY A MUTUAL  HOLDING
 COMPANY  AND  WHICH  HOLDS,  DIRECTLY  OR INDIRECTLY, VOTING STOCK IN AT
 LEAST ONE REORGANIZED INSURER.
   (R) "VOTING SECURITY" INCLUDES VOTING SECURITIES AS DEFINED  IN  PARA-
 GRAPH  FORTY-FIVE OF SUBSECTION (A) OF SECTION ONE HUNDRED SEVEN OF THIS
 CHAPTER,  ANY  REORGANIZATION  CERTIFICATE  OR  SUBSCRIPTION  (INCLUDING
 SUBSCRIPTION RIGHTS ISSUED PURSUANT TO A PLAN OF REORGANIZATION), OR ANY
 SECURITY CONVERTIBLE (WITH OR WITHOUT CONSIDERATION) INTO ANY SUCH SECU-
 RITY,  OR CARRYING ANY WARRANT OR RIGHT TO SUBSCRIBE FOR OR PURCHASE ANY
 SUCH SECURITY, OR ANY SUCH WARRANT OR RIGHT.
   (S) "VOTING STOCK" MEANS CAPITAL STOCK THAT CONSTITUTES VOTING SECURI-
 TIES AS DEFINED IN PARAGRAPH FORTY-FIVE OF SUBSECTION (A) OF SECTION ONE
 HUNDRED SEVEN OF THIS CHAPTER. ALL REFERENCES IN THIS ARTICLE TO A SPEC-
 IFIED PERCENTAGE OF THE VOTING STOCK OF ANY PERSON SHALL MEAN SECURITIES
 HAVING THE SPECIFIED PERCENTAGE OF THE VOTING POWER IN SUCH  PERSON  FOR
 A. 8164                             4
 
 THE  ELECTION  OF DIRECTORS, TRUSTEES OR MANAGEMENT OF SUCH PERSON OTHER
 THAN SECURITIES HAVING SUCH POWER ONLY BY REASON OF THE HAPPENING  OF  A
 CONTINGENCY.
   §  8102.  REORGANIZATION  OF  MUTUAL PROPERTY/CASUALTY INSURER THROUGH
 FORMATION OF A MUTUAL HOLDING COMPANY; CONTENTS OF PLAN.  (A)  A  MUTUAL
 PROPERTY/CASUALTY  INSURER  MAY  BE  REORGANIZED  AS  A  DOMESTIC  STOCK
 PROPERTY/CASUALTY INSURER WITH A MUTUAL  HOLDING  COMPANY  BY  COMPLYING
 WITH THE REQUIREMENTS OF THIS ARTICLE.
   (B) THE PLAN OF REORGANIZATION SHALL CONTAIN PROVISIONS FOR:
   (1)    THE    REORGANIZING   INSURER   BECOMING   A   DOMESTIC   STOCK
 PROPERTY/CASUALTY INSURER;
   (2) THE FORMATION OF A MUTUAL HOLDING COMPANY;
   (3) THE ELIGIBLE MEMBERS OF THE REORGANIZING INSURER BECOMING  MEMBERS
 OF THE MUTUAL HOLDING COMPANY WITH MEMBERSHIP INTERESTS THEREIN, AND THE
 MEMBERSHIP INTERESTS IN THE REORGANIZING INSURER BEING EXTINGUISHED;
   (4) AT LEAST FIFTY-ONE PERCENT OF THE VOTING STOCK ISSUED BY THE REOR-
 GANIZED INSURER BEING ACQUIRED AND HELD, DIRECTLY OR THROUGH ONE OR MORE
 INTERMEDIATE STOCK HOLDING COMPANIES, BY THE MUTUAL HOLDING COMPANY;
   (5)  IF  APPLICABLE,  THE  GENERAL  TERMS  FOR THE ESTABLISHMENT OF AN
 ALTERNATIVE PROVISION UNDER THE PROPOSED DIVIDEND POLICY  UNDER  SECTION
 EIGHT THOUSAND ONE HUNDRED THREE OF THIS ARTICLE; AND
   (6)  A  PLAN OF OPERATION FOR THE REORGANIZED INSURER INCLUDING FINAN-
 CIAL PROJECTIONS FOR A THREE-YEAR PERIOD AND A STATEMENT INDICATING  ITS
 INTENTIONS WITH REGARD TO ISSUING ANY NONPARTICIPATING BUSINESS.
   (C)  THE  PLAN OF REORGANIZATION SHALL PROVIDE THAT THE REORGANIZATION
 PROCESS ITSELF WILL NOT CHANGE PREMIUMS OR  REDUCE  POLICY  BENEFITS  OR
 OTHER  POLICY  OBLIGATIONS  OF  THE  MUTUAL  PROPERTY/CASUALTY  INSURER,
 PROVIDED THAT THE PLAN OF REORGANIZATION MAY PROVIDE THAT  THE  REORGAN-
 IZED  STOCK  INSURER WILL BE ABLE TO MAKE SUCH CHANGES AND REDUCTIONS AS
 WOULD BE PERMITTED UNDER THIS CHAPTER IF  THE  MUTUAL  PROPERTY/CASUALTY
 INSURER WERE NOT A REORGANIZING INSURER UNDER THIS ARTICLE.
   (D) THE PLAN MAY PROVIDE FOR THE FORMATION OF ONE OR MORE INTERMEDIATE
 STOCK HOLDING COMPANIES.
   (E) THE PLAN SHALL INCLUDE THE FOLLOWING AS EXHIBITS:
   (1)  THE  PROPOSED  CHARTERS  OR  CERTIFICATES OF INCORPORATION OF THE
 REORGANIZED INSURER, THE MUTUAL HOLDING  COMPANY  AND  ANY  INTERMEDIATE
 STOCK HOLDING COMPANY OR COMPANIES; AND
   (2)  THE PROPOSED BY-LAWS OF THE REORGANIZED INSURER, THE MUTUAL HOLD-
 ING COMPANY AND ANY STOCK HOLDING COMPANY OR COMPANIES.
   § 8103. DIVIDEND PRACTICES. FOLLOWING THE EFFECTIVE DATE OF THE  PLAN,
 THE REORGANIZED INSURER MAY, WITH RESPECT TO ITS INDIVIDUAL POLICIES AND
 CONTRACTS:
   (A) CONTINUE THE DIVIDEND PRACTICES OF THE REORGANIZING INSURER;
   (B)  CONTINUE  THE  DIVIDEND PRACTICES OF THE REORGANIZING INSURER AND
 ADOPT SUCH OTHER DIVIDEND PRACTICES AS, AT THE  TIME  OF  THE  EFFECTIVE
 DATE OR AT ANY TIME THEREAFTER, MAY BE PERMITTED UNDER APPLICABLE LAW OR
 REGULATION OR APPROVED BY THE SUPERINTENDENT;
   (C) ADOPT SUCH OTHER ALTERNATIVE WITH RESPECT TO DIVIDEND PRACTICES AS
 THE SUPERINTENDENT MAY APPROVE; OR
   (D) DISCONTINUE THE DIVIDEND PRACTICES OF THE REORGANIZING INSURER.
   §  8104.  ADOPTION  OF PLAN; SUBMISSION OF PLAN TO THE SUPERINTENDENT.
 (A) A MUTUAL PROPERTY/CASUALTY INSURER SEEKING TO REORGANIZE UNDER  THIS
 ARTICLE  SHALL,  BY  APPROVAL  OF  A RESOLUTION ADOPTED BY AT LEAST TWO-
 THIRDS OF ITS ENTIRE BOARD OF DIRECTORS, ADOPT A  PLAN  CONSISTENT  WITH
 THE  PROVISIONS  OF  SECTIONS  EIGHT  THOUSAND ONE HUNDRED TWO AND EIGHT
 THOUSAND ONE HUNDRED THREE OF THIS ARTICLE WHICH IS FAIR  AND  EQUITABLE
 A. 8164                             5
 
 TO  THE  POLICYHOLDERS. THE RESOLUTION VOTED UPON BY THE BOARD OF DIREC-
 TORS SHALL SPECIFY THE REASONS FOR AND  THE  PURPOSES  OF  THE  PROPOSED
 REORGANIZATION.
   (B)  THE  PLAN SHALL BE SUBMITTED TO THE SUPERINTENDENT, TOGETHER WITH
 THE RESOLUTION OF THE BOARD OF DIRECTORS OF  THE  REORGANIZING  INSURER,
 CERTIFIED  BY  THE SECRETARY THEREOF, ADOPTING THE PLAN PURSUANT TO THIS
 ARTICLE.
   § 8105. AMENDMENT OR WITHDRAWAL OF PLAN. AT ANY TIME BEFORE  THE  PLAN
 OF  REORGANIZATION  BECOMES EFFECTIVE AS PROVIDED IN SECTION EIGHT THOU-
 SAND ONE HUNDRED NINE OF THIS ARTICLE, THE REORGANIZING INSURER MAY,  BY
 RESOLUTION OF A THREE-FOURTHS MAJORITY OF ITS ENTIRE BOARD OF DIRECTORS,
 AMEND THE PLAN OF REORGANIZATION OR WITHDRAW THE PLAN OF REORGANIZATION.
 IN  THE  CASE OF A PLAN AMENDMENT, ALL REFERENCES IN THIS ARTICLE TO THE
 PLAN OF REORGANIZATION SHALL BE DEEMED TO REFER TO THE PLAN AS  AMENDED,
 BUT NO AMENDMENT SHALL BE DEEMED TO CHANGE THE ADOPTION DATE OF THE PLAN
 OF  REORGANIZATION. A FURTHER PUBLIC HEARING IS NOT NECESSARY UNLESS THE
 SUPERINTENDENT DETERMINES THAT AMENDMENTS SUBMITTED AFTER  THE  ORIGINAL
 HEARING  REQUIRED UNDER SECTION EIGHT THOUSAND ONE HUNDRED SEVEN OF THIS
 ARTICLE WILL SUBSTANTIALLY ALTER THE PLAN. IN THE EVENT THAT THE  SUPER-
 INTENDENT  DETERMINES  THAT THE AMENDMENT SUBSTANTIALLY ALTERS THE PLAN,
 THE PLAN AS AMENDED MUST BE SUBMITTED FOR RECONSIDERATION BY THE  ELIGI-
 BLE  MEMBERS  AS PROVIDED IN SECTION EIGHT THOUSAND ONE HUNDRED EIGHT OF
 THIS ARTICLE.
   § 8106. CONSULTANTS.  THE  SUPERINTENDENT  MAY  APPOINT  ONE  OR  MORE
 CONSULTANTS  AS  THE  SUPERINTENDENT  SHALL REASONABLY DEEM NECESSARY TO
 ADVISE THE SUPERINTENDENT IN MAKING THE  DETERMINATION  OF  WHETHER  THE
 PROPOSED  PLAN  OF  REORGANIZATION  MEETS THE APPLICABLE REQUIREMENTS OF
 THIS ARTICLE. THE REORGANIZING INSURER  SHALL  BE  RESPONSIBLE  FOR  THE
 REASONABLE  FEES  AND EXPENSES OF ANY SUCH CONSULTANTS. THIS EXPENDITURE
 SHALL NOT CONSTITUTE AN EXPENDITURE OF  PUBLIC  FUNDS  PURSUANT  TO  THE
 STATE  FINANCE  LAW,  BUT  THE  SUPERINTENDENT, WITH THE APPROVAL OF THE
 COMPTROLLER, MAY IN THE SUPERINTENDENT'S DISCRETION FOR GOOD CAUSE SHOWN
 REMIT SUCH CHARGES.
   § 8107. APPROVAL OF PLAN BY SUPERINTENDENT; HEARING.  THE  SUPERINTEN-
 DENT MAY ORDER A PUBLIC HEARING ON THE PLAN TO BE HELD PRIOR TO THE PLAN
 BEING SUBMITTED TO THE ELIGIBLE MEMBERS FOR THEIR APPROVAL. THE REORGAN-
 IZING  INSURER  SHALL  GIVE  WRITTEN  NOTICE  OF THE HEARING TO ELIGIBLE
 MEMBERS SENT BY MAIL OR ELECTRONIC TRANSMISSION TO THE LAST KNOWN  MAIL-
 ING  OR  ELECTRONIC  ADDRESSES  OF SUCH ELIGIBLE MEMBERS AS SHOWN ON THE
 RECORDS OF THE  REORGANIZING  INSURER.  SUCH  SUMMARY  NOTICE  SHALL  BE
 SUBJECT  TO  THE APPROVAL OF THE SUPERINTENDENT, SHALL INCLUDE THE DATE,
 TIME AND PLACE OF THE HEARING, AND SHALL INCLUDE BOTH A WEBSITE  ADDRESS
 AND  A  TOLL-FREE  TELEPHONE  NUMBER  THROUGH WHICH ELIGIBLE MEMBERS MAY
 OBTAIN, IF NOT INCLUDED IN THE SUMMARY NOTICE,  A  FULL  NOTICE  OF  THE
 HEARING  AND  EITHER  A  TRUE AND CORRECT COPY OF THE PLAN, OR A SUMMARY
 THEREOF APPROVED BY  THE  SUPERINTENDENT,  AND  SUCH  OTHER  EXPLANATORY
 INFORMATION  AS  THE SUPERINTENDENT SHALL APPROVE OR REQUIRE.  THE REOR-
 GANIZING INSURER SHALL ALSO POST A COPY OF SUCH NOTICE ON  ITS  WEBSITE.
 SUCH  NOTICE  SHALL  BE  SENT  TO  ELIGIBLE MEMBERS AT LEAST THIRTY DAYS
 BEFORE THE DATE SPECIFIED FOR THE HEARING AND MAY BE SENT ELECTRONICALLY
 IF THE ELIGIBLE MEMBER HAS  CONSENTED  TO  RECEIVE  ELECTRONIC  COMMUNI-
 CATIONS  FROM THE REORGANIZING INSURER UNDER SECTION THREE THOUSAND FOUR
 HUNDRED FIFTY-EIGHT OF THIS CHAPTER. THE HEARING SHALL BE HELD AT A TIME
 AND LOCATION IN THIS STATE DEEMED  BY  THE  SUPERINTENDENT  TO  BE  MOST
 CONVENIENT  TO  THE GREATEST NUMBER OF ELIGIBLE MEMBERS. AT SUCH HEARING
 ANY PERSON MAY BE HEARD IN FAVOR OF, OR AGAINST, THE TERMS OF THE  PLAN.
 A. 8164                             6

 THE PLAN OF REORGANIZATION SHALL BE MADE AVAILABLE FOR PUBLIC INSPECTION
 AT  ONE  OFFICE  OF  THE DEPARTMENT IN EACH CITY IN THIS STATE WHERE THE
 DEPARTMENT MAINTAINS AN OFFICE AND AT THE PRINCIPAL OFFICE OF THE  REOR-
 GANIZING  INSURER.  THE  SUPERINTENDENT  SHALL  APPROVE  THE PLAN IF THE
 SUPERINTENDENT FINDS THAT:
   (A) THE PLAN IS FAIR AND EQUITABLE TO POLICYHOLDERS;
   (B) THE PLAN DOES NOT VIOLATE THIS ARTICLE; AND
   (C) AFTER GIVING EFFECT TO THE REORGANIZATION, THE REORGANIZED INSURER
 WILL HAVE AN AMOUNT OF CAPITAL AND SURPLUS THE SUPERINTENDENT  DEEMS  TO
 BE REASONABLY NECESSARY FOR ITS FUTURE SOLVENCY.
   §  8108.  APPROVAL  OF  PLAN  BY  ELIGIBLE  MEMBERS. (A) A PROPOSAL TO
 APPROVE THE PLAN  OF  REORGANIZATION  SHALL  BE  SUBMITTED  TO  ELIGIBLE
 MEMBERS  FOR  APPROVAL.    THE  REORGANIZING  INSURER SHALL GIVE WRITTEN
 NOTICE STATING THE DATE, TIME AND PLACE FOR VOTING ON SUCH  PROPOSAL  TO
 ELIGIBLE  MEMBERS  AND  TO  VOTE ON THE PROPOSAL IN ACCORDANCE WITH THIS
 SECTION, SENT BY MAIL OR ELECTRONIC TRANSMISSION TO THE LAST KNOWN MAIL-
 ING OR ELECTRONIC ADDRESSES  OF  SUCH  POLICYHOLDERS  AS  SHOWN  ON  THE
 RECORDS OF THE REORGANIZING INSURER.  SUCH NOTICE SHALL BE SENT AT LEAST
 FORTY-FIVE DAYS BEFORE THE DATE OF THE PROPOSED VOTE TO APPROVE THE PLAN
 OF  REORGANIZATION.  SUCH NOTICE MAY BE COMBINED WITH THE SUMMARY NOTICE
 OF THE HEARING REQUIRED BY SECTION EIGHT THOUSAND ONE HUNDRED  SEVEN  OF
 THIS ARTICLE. SUCH NOTICE SHALL BE SUBJECT TO THE APPROVAL OF THE SUPER-
 INTENDENT AND SHALL INCLUDE BOTH A WEBSITE ADDRESS AND A TOLL-FREE TELE-
 PHONE  NUMBER THROUGH WHICH MEMBERS MAY OBTAIN EITHER A TRUE AND CORRECT
 COPY OF THE PLAN, OR A SUMMARY THEREOF APPROVED BY  THE  SUPERINTENDENT,
 AND  SUCH  OTHER  EXPLANATORY  INFORMATION  AS  THE SUPERINTENDENT SHALL
 APPROVE OR REQUIRE.
   (B) EACH ELIGIBLE MEMBER SHALL BE ENTITLED TO CAST  ONE  VOTE,  UNLESS
 OTHERWISE  PROVIDED IN THE CHARTER OR BY-LAWS OF THE REORGANIZING INSUR-
 ER, ON THE PROPOSAL, EITHER IN PERSON, BY MAIL OR BY PROXY, IRRESPECTIVE
 OF THE NUMBER OR AMOUNT OF THE POLICIES OR CONTRACTS  HELD.  EACH  PROXY
 SHALL  BE  REVOCABLE AT ANY TIME, EXCEPT TO THE EXTENT THAT, AT THE TIME
 OF ATTEMPTED REVOCATION, THE POWER CONFERRED THEREBY  HAS  ALREADY  BEEN
 PROPERLY EXERCISED. ALL VOTES SHALL BE BY WRITTEN BALLOT CAST IN PERSON,
 BY  MAIL  OR  BY ELECTRONIC MEANS BY ELIGIBLE MEMBERS OR BY PROXY AGENTS
 DULY APPOINTED BY ELIGIBLE MEMBERS. THE IN-PERSON  VOTING  ON  THE  PLAN
 SHALL BE HELD AT A LOCATION AND TIME APPROVED BY THE SUPERINTENDENT.
   (C)  THE  PROPOSAL  TO  APPROVE  THE  PLAN  OF REORGANIZATION SHALL BE
 ADOPTED BY THE AFFIRMATIVE VOTE OF AT LEAST TWO-THIRDS OF ALL VOTES CAST
 BY ELIGIBLE MEMBERS.
   (D) THE SUPERINTENDENT SHALL HAVE POWER TO PRESCRIBE  RULES  GOVERNING
 THE PROCEDURES FOR CONDUCT OF THE VOTING ON THE PROPOSAL.
   (E)  THE  PROVISIONS  OF  SECTION FOUR THOUSAND ONE HUNDRED SIXTEEN OF
 THIS CHAPTER SHALL NOT APPLY TO THE ACTION BY ELIGIBLE MEMBERS  PURSUANT
 TO THIS SECTION.
   (F)  THE  PROVISIONS  OF  SUBSECTION  (A) OF SECTION FOUR THOUSAND ONE
 HUNDRED TEN OF THIS CHAPTER AND SUBSECTION (A) OF SECTION  SIX  THOUSAND
 SIX  HUNDRED  THIRTEEN  OF THIS CHAPTER SHALL NOT APPLY TO A CORPORATION
 ORGANIZED UNDER SECTION EIGHT THOUSAND ONE  HUNDRED  SEVENTEEN  OF  THIS
 ARTICLE.
   (G)  UPON  THE  CONCLUSION OF THE VOTE, THE REORGANIZING INSURER SHALL
 SUBMIT TO THE SUPERINTENDENT:
   (1) A CERTIFIED COPY OF THE PLAN OF REORGANIZATION, SUBSCRIBED BY  THE
 CHAIRMAN  OF THE BOARD, THE PRESIDENT OR ANY VICE PRESIDENT AND ATTESTED
 BY THE SECRETARY OR AN ASSISTANT SECRETARY OF THE REORGANIZING INSURER;
 A. 8164                             7
 
   (2) A CERTIFICATE, SUBSCRIBED BY THE CHAIRMAN OF THE BOARD, THE PRESI-
 DENT OR ANY VICE PRESIDENT AND ATTESTED BY THE  SECRETARY  OR  ASSISTANT
 SECRETARY  OF  THE  REORGANIZING INSURER, OR SUBSCRIBED BY THE PERSON OR
 PERSONS, IF ANY, DESIGNATED  BY  THE  SUPERINTENDENT  TO  SUPERVISE  THE
 GIVING  OF  NOTICE OF THE DATE FOR ACTION ON THE PROPOSAL, TO THE EFFECT
 THAT SUCH NOTICE WAS GIVEN IN ACCORDANCE WITH THIS SECTION TO ALL  POLI-
 CYHOLDERS ENTITLED TO SUCH NOTICE; AND
   (3) A CERTIFICATE SUBSCRIBED BY AN OFFICER OF THE REORGANIZING INSURER
 OF  THE  RESULTS  OF  THE  VOTE,  AS EVIDENCED BY VALID BALLOTS RECEIVED
 BEFORE THE POLLS WERE CLOSED.
   (H) EACH SUCH CERTIFICATE SHALL BE AFFIRMED AS TRUE UNDER  THE  PENAL-
 TIES  OF  PERJURY  BY THE PERSON OR PERSONS SUBSCRIBING THE SAME AND, IN
 THE CASE OF A CERTIFICATE SIGNED BY OFFICERS OF THE REORGANIZING  INSUR-
 ER,  SHALL  BE  AFFIRMED  UNDER  THE  CORPORATE SEAL OF THE REORGANIZING
 INSURER.
   § 8109. FILING OF PLAN; EFFECTIVE DATE OF REORGANIZATION. (A) WHEN THE
 SUPERINTENDENT HAS APPROVED THE PLAN OF REORGANIZATION  AS  PROVIDED  IN
 SECTION  EIGHT  THOUSAND  ONE HUNDRED SEVEN OF THIS ARTICLE, AND CERTIF-
 ICATION OF APPROVAL OF THE PLAN BY ELIGIBLE MEMBERS HAS BEEN MADE TO THE
 SUPERINTENDENT AS PROVIDED IN SECTION EIGHT THOUSAND ONE  HUNDRED  EIGHT
 OF  THIS  ARTICLE, A COPY OF THE PLAN OF REORGANIZATION, WITH THE SUPER-
 INTENDENT'S APPROVAL ENDORSED THEREON, SHALL BE FILED IN THE  OFFICE  OF
 THE  SUPERINTENDENT. A COPY OF SUCH PLAN CERTIFIED BY THE SUPERINTENDENT
 SHALL ALSO BE FILED BY THE REORGANIZING INSURER IN  THE  OFFICE  OF  THE
 CLERK  OF  THE  COUNTY  WHERE  THE  PRINCIPAL OFFICE OF THE REORGANIZING
 INSURER  IS  LOCATED  WITHIN  THIRTY  DAYS  AFTER  THE  SUPERINTENDENT'S
 APPROVAL.
   (B)  THE  PLAN  OF REORGANIZATION SHALL TAKE EFFECT IN ACCORDANCE WITH
 ITS TERMS ON THE DATE AND AT THE TIME WHEN THE FILING IN THE  OFFICE  OF
 THE  SUPERINTENDENT  REQUIRED  BY  THIS SECTION HAS BEEN MADE OR ON SUCH
 LATER DATE OR AT SUCH LATER TIME, IF ANY, AS MAY HAVE BEEN SPECIFIED  IN
 OR DETERMINED IN ACCORDANCE WITH THE PLAN OR PURSUANT THERETO.
   (C)  AS  OF  THE  EFFECTIVE  DATE,  THE  SUPERINTENDENT SHALL ISSUE AN
 AMENDED CERTIFICATE OF AUTHORITY TO THE REORGANIZED INSURER, AND, IF THE
 PLAN OF REORGANIZATION SPECIFIES THAT THE REORGANIZED  INSURER  PROPOSES
 TO  CONTINUE  TO ISSUE FOR DELIVERY IN THIS STATE PARTICIPATING POLICIES
 OR CONTRACTS, THE SUPERINTENDENT SHALL, ISSUE A PERMIT AUTHORIZING IT TO
 DO SO.
   § 8110. EFFECT OF REORGANIZATION. UPON THE EFFECTIVE DATE OF A PLAN OF
 REORGANIZATION IN ACCORDANCE WITH SECTION  EIGHT  THOUSAND  ONE  HUNDRED
 NINE OF THIS ARTICLE:
   (A) THE REORGANIZING INSURER SHALL IMMEDIATELY BECOME A DOMESTIC STOCK
 PROPERTY/CASUALTY INSURER;
   (B)  THE  POLICYHOLDERS  OF  THE REORGANIZING INSURER ON THE EFFECTIVE
 DATE SHALL IMMEDIATELY BECOME MEMBERS OF THE MUTUAL HOLDING COMPANY WITH
 MEMBERSHIP INTERESTS THEREIN, AND ALL MEMBERSHIP INTERESTS IN THE  REOR-
 GANIZING INSURER SHALL BE EXTINGUISHED;
   (C)  PERSONS  BECOMING  POLICYHOLDERS OF THE REORGANIZED INSURER AFTER
 THE EFFECTIVE DATE OF THE PLAN SHALL BECOME MEMBERS OF THE MUTUAL  HOLD-
 ING COMPANY IMMEDIATELY UPON ISSUANCE OF THE POLICY OR CONTRACT;
   (D)  ONE HUNDRED PERCENT OF THE VOTING STOCK ISSUED BY THE REORGANIZED
 INSURER SHALL BE OWNED, DIRECTLY OR THROUGH  ONE  OR  MORE  INTERMEDIATE
 STOCK  HOLDING  COMPANIES, BY THE MUTUAL HOLDING COMPANY, AND AT NO TIME
 SUBSEQUENT SHALL SUCH MUTUAL HOLDING COMPANY  OWN  LESS  THAN  FIFTY-ONE
 PERCENT OF SUCH VOTING STOCK; AND
 A. 8164                             8
 
   (E)  ANY  OTHER  REORGANIZATION  OF  THE  REORGANIZING INSURER AND ITS
 SUBSIDIARIES SPECIFIED IN THE PLAN SHALL BECOME EFFECTIVE IN  ACCORDANCE
 WITH  THE TERMS OF THE PLAN. EXCEPT FOR THE RIGHT TO VOTE, THE RIGHTS OF
 ALL POLICYHOLDERS WITH RESPECT TO  THE  REORGANIZED  INSURER  THEREAFTER
 SHALL  BE AS SPECIFIED IN THEIR POLICIES OR CONTRACTS, IN THE CHARTER OF
 THE REORGANIZED INSURER AND IN THE PLAN OF REORGANIZATION.
   § 8111. CORPORATE EXISTENCE. (A) THE REORGANIZED INSURER  SHALL  BE  A
 CONTINUATION  OF  THE REORGANIZING INSURER, AND THE REORGANIZATION SHALL
 IN NO WAY ANNUL, MODIFY, OR CHANGE ANY OF SUCH INSURER'S EXISTING SUITS,
 RIGHTS, CONTRACTS, OR LIABILITIES EXCEPT AS  PROVIDED  IN  THE  APPROVED
 PLAN  OF  REORGANIZATION.  ALL  RIGHTS,  FRANCHISES AND INTERESTS OF THE
 REORGANIZING INSURER IN AND TO EVERY SPECIES OF PROPERTY, REAL, PERSONAL
 AND MIXED, AND THINGS IN ACTION THEREUNTO BELONGING, SHALL BE VESTED  IN
 THE CONTINUING COMPANY, WITHOUT ANY DEED OR TRANSFER, AND SIMULTANEOUSLY
 THEREWITH  SUCH  CONTINUING COMPANY SHALL BE SUBJECT TO ALL OF THE OBLI-
 GATIONS AND LIABILITIES OF THE REORGANIZING INSURER,  OTHER  THAN  OBLI-
 GATIONS  AND  LIABILITIES  WITH RESPECT TO THE POLICYHOLDERS' MEMBERSHIP
 INTERESTS EXTINGUISHED BY THE PLAN OF REORGANIZATION.
   (B) NO ACTION OR PROCEEDING PENDING AT THE TIME OF THE  REORGANIZATION
 TO  WHICH  THE  REORGANIZING  INSURER  MAY BE A PARTY SHALL BE ABATED OR
 DISCONTINUED BY REASON OF SUCH REORGANIZATION, BUT THE SAME MAY BE PROS-
 ECUTED TO FINAL JUDGMENT IN THE SAME MANNER AS IF THE REORGANIZATION HAD
 NOT TAKEN PLACE, OR THE REORGANIZED INSURER MAY BE SUBSTITUTED IN  PLACE
 OF  SUCH  REORGANIZING INSURER BY ORDER OF THE COURT IN WHICH THE ACTION
 OR PROCEEDING MAY BE PENDING.
   § 8112. DIRECTORS AND OFFICERS. EXCEPT AS OTHERWISE  PROVIDED  IN  THE
 PLAN  OF  REORGANIZATION  AND SUBJECT TO SUBSECTION (D) OF SECTION EIGHT
 THOUSAND ONE HUNDRED SEVENTEEN OF THIS ARTICLE, THE DIRECTORS AND  OFFI-
 CERS  OF  THE REORGANIZING INSURER SHALL SERVE AS DIRECTORS AND OFFICERS
 OF THE REORGANIZED INSURER, ANY INTERMEDIATE STOCK HOLDING  COMPANY  AND
 THE  MUTUAL  HOLDING  COMPANY UNTIL NEW DIRECTORS AND OFFICERS HAVE BEEN
 DULY ELECTED AND QUALIFIED PURSUANT TO THE  CHARTER  OR  CERTIFICATE  OF
 INCORPORATION AND THE BY-LAWS OF THE RESPECTIVE COMPANIES.
   §  8113.  NOTICE  OF  PROPOSED  REORGANIZATION. (A) IN ADDITION TO THE
 NOTICES GIVEN PURSUANT TO SECTION EIGHT THOUSAND ONE  HUNDRED  EIGHT  OF
 THIS  ARTICLE, THE REORGANIZING INSURER SHALL GIVE WRITTEN NOTICE OF THE
 PENDENCY OF THE PROPOSED REORGANIZATION AND OF THE EFFECT THEREOF TO ALL
 PERSONS WHO ARE NOT ELIGIBLE MEMBERS TO WHOM  THE  REORGANIZING  INSURER
 DELIVERS  POLICIES  OR CONTRACTS THAT ARE ISSUED AFTER THE ADOPTION DATE
 AND BEFORE THE PLAN TAKES EFFECT OR IS WITHDRAWN, SENT BY MAIL OR  ELEC-
 TRONIC TRANSMISSION TO THE LAST KNOWN MAILING OR ELECTRONIC ADDRESSES OF
 SUCH PERSONS AS SHOWN ON THE RECORDS OF THE REORGANIZING INSURER.
   (B)  NEITHER  THE  RECEIPT OF SUCH POLICY OR CONTRACT NOR THE RIGHT TO
 RECEIVE SUCH NOTICE SHALL ENTITLE SUCH PERSONS TO VOTE ON  THE  PROPOSED
 PLAN  OF  REORGANIZATION  PURSUANT TO SECTION EIGHT THOUSAND ONE HUNDRED
 EIGHT OF THIS ARTICLE OR VEST SUCH PERSONS  WITH  ANY  OTHER  RIGHTS  OR
 ENTITLEMENTS EXCEPT AS PROVIDED FOR IN THIS ARTICLE.
   (C) WHERE, PRIOR TO THE ISSUANCE OF A POLICY OR CONTRACT, THE REORGAN-
 IZING  INSURER PROVIDES THE PROSPECTIVE POLICYHOLDERS WITH NOTICE OF THE
 PENDENCY OF THE PROPOSED REORGANIZATION AND OF THE EFFECT THEREOF, WHICH
 NOTICE HAS BEEN APPROVED FOR SUCH PURPOSE BY THE  SUPERINTENDENT,  THEN,
 UNLESS  THE  LAWS  OF  THE  POLICYHOLDER'S  DOMICILIARY  STATE OTHERWISE
 REQUIRE, SUCH POLICYHOLDERS SHALL  NOT  HAVE  THE  FOREGOING  RIGHTS  OF
 RESCISSION AND REFUND.
   §  8114.  FAILURE TO GIVE NOTICE. IF THE REORGANIZING INSURER COMPLIES
 SUBSTANTIALLY AND IN GOOD FAITH WITH THE REQUIREMENTS  OF  THIS  ARTICLE
 A. 8164                             9
 
 WITH  RESPECT  TO  THE GIVING OF ANY REQUIRED NOTICE, ITS FAILURE IN ANY
 CASE TO GIVE SUCH NOTICE TO ANY PERSON OR PERSONS ENTITLED THERETO SHALL
 NOT IMPAIR THE VALIDITY OF THE ACTIONS AND PROCEEDINGS TAKEN UNDER  THIS
 ARTICLE  OR  ENTITLE  SUCH  PERSON  TO ANY INJUNCTIVE OR OTHER EQUITABLE
 RELIEF WITH RESPECT THERETO, NOR SHALL SUCH PERSON HAVE  ANY  CLAIM  FOR
 DAMAGES DUE TO SUCH FAILURE.
   §  8115.  LIMITATIONS  OF  ACTIONS;  SECURITY. (A) NOTWITHSTANDING ANY
 OTHER PROVISION OF LAW TO THE CONTRARY AND EXCEPT AS OTHERWISE  PROVIDED
 IN  SUBSECTION (C) OR (D) OF THIS SECTION, ACTIONS CONCERNING OR ARISING
 OUT OF ANY PLAN OF REORGANIZATION, PROPOSED PLAN OF REORGANIZATION, PLAN
 AMENDMENT OR PROPOSED PLAN AMENDMENT UNDER  THIS  ARTICLE  OR  ANY  ACTS
 TAKEN  OR  PROPOSED  TO  BE  TAKEN UNDER THIS ARTICLE SHALL BE COMMENCED
 WITHIN EIGHTEEN MONTHS AFTER THE PLAN OF REORGANIZATION OR  PLAN  AMEND-
 MENT  IS  FILED PURSUANT TO SUBSECTION (A) OF SECTION EIGHT THOUSAND ONE
 HUNDRED NINE OF THIS  ARTICLE  OR  THE  CHARTER  IS  FILED  PURSUANT  TO
 SUBSECTION  (C)  OF SECTION EIGHT THOUSAND ONE HUNDRED SEVENTEEN OF THIS
 ARTICLE, AS THE CASE MAY BE, IN THE OFFICE OF THE SUPERINTENDENT OR  ONE
 YEAR FROM THE EFFECTIVE DATE OF THE PLAN OF REORGANIZATION, WHICHEVER IS
 LATER,  OR IF THE PLAN OF REORGANIZATION OR PLAN AMENDMENT IS WITHDRAWN,
 WITHIN ONE YEAR FROM THE DATE THE BOARD OF DIRECTORS APPROVES  A  RESOL-
 UTION  TO WITHDRAW THE PLAN. WHERE AN ACTION CONCERNS OR ARISES OUT OF A
 PLAN AMENDMENT OR PROPOSED PLAN AMENDMENT MADE UNDER SECTION EIGHT THOU-
 SAND ONE HUNDRED FIVE OF THIS ARTICLE, THE  APPLICABLE  TIME  PERIOD  IS
 MEASURED  FROM  THE  FILING, EFFECTIVE DATE OR APPROVAL OF WITHDRAWAL OF
 THE PLAN AMENDMENT, AS THE CASE MAY BE. WHERE THE ACTION ARISES  OUT  OF
 EITHER A TRANSFER OF SUBSIDIARIES PURSUANT TO SECTION EIGHT THOUSAND ONE
 HUNDRED  TWENTY  OF THIS ARTICLE OR A SALE OF SECURITIES OF THE REORGAN-
 IZED INSURER OR ANY STOCK HOLDING  COMPANY  PURSUANT  TO  SECTION  EIGHT
 THOUSAND ONE HUNDRED EIGHTEEN OF THIS ARTICLE, WHICH TRANSFER OR SALE IS
 NOT  CONTEMPLATED  BY THE PLAN, THEN THE APPLICABLE TIME PERIOD SHALL BE
 MEASURED FROM THE EFFECTIVE DATE OF SUCH TRANSFER OR SALE, AS  THE  CASE
 MAY BE. WHERE THE ACTION CONCERNS OR ARISES OUT OF A PLAN OF REORGANIZA-
 TION  ADOPTED PURSUANT TO SECTION EIGHT THOUSAND ONE HUNDRED NINETEEN OF
 THIS ARTICLE, THEN THE APPLICABLE TIME PERIOD SHALL BE MEASURED FROM THE
 EFFECTIVE DATE OF THE PLAN OF REORGANIZATION.
   (B) IN ANY ACTION REFERRED TO IN SUBSECTION (A) OF THIS  SECTION,  THE
 PLAINTIFF  OR  PLAINTIFFS SHALL BE REQUIRED, UPON A MOTION OF THE MUTUAL
 HOLDING COMPANY, REORGANIZING INSURER  OR  REORGANIZED  INSURER  OR  ANY
 INTERMEDIATE STOCK HOLDING COMPANY WHICH ESTABLISHES TO THE SATISFACTION
 OF  THE  COURT, THAT A SUBSTANTIAL LIKELIHOOD EXISTS THAT SUCH ACTION IS
 BROUGHT WITHOUT MERIT AND WITH AN INTENTION TO DELAY OR HARASS, TO  GIVE
 ADEQUATE  SECURITY  FOR  THE  DAMAGES AND REASONABLE EXPENSES, INCLUDING
 ATTORNEYS' FEES, WHICH MAY BE INCURRED AS A RESULT OF, OR IN  CONNECTION
 WITH,  SUCH  ACTION  BY SUCH COMPANY AND BY ANY OTHER DEFENDANTS IN SUCH
 ACTION OR FOR WHICH SUCH COMPANY MAY BECOME LIABLE,  TO  WHICH  SECURITY
 THE  MUTUAL HOLDING COMPANY, REORGANIZING INSURER OR REORGANIZED INSURER
 OR ANY STOCK HOLDING COMPANY SHALL HAVE RECOURSE IN SUCH AMOUNT  AS  THE
 COURT  DETERMINES  UPON  THE  TERMINATION  OF SUCH ACTION. THE AMOUNT OF
 SECURITY MAY FROM  TIME  TO  TIME  BE  INCREASED  OR  DECREASED  IN  THE
 DISCRETION OF THE COURT UPON A SHOWING THAT THE SECURITY PROVIDED HAS OR
 MAY BECOME INADEQUATE OR EXCESSIVE.
   (C)  NOTWITHSTANDING  ANY  OTHER PROVISION OF LAW TO THE CONTRARY, ANY
 ACTION SEEKING A STAY, RESTRAINING ORDER, INJUNCTION OR  SIMILAR  REMEDY
 TO  PREVENT  OR  DELAY  THE  CLOSING OF ANY TRANSACTION PURSUANT TO THIS
 ARTICLE OR OF ANY TRANSACTION DESCRIBED IN THE  PLAN  OF  REORGANIZATION
 A. 8164                            10
 
 MUST  BE  COMMENCED WITHIN THE EARLIER OF ONE HUNDRED TWENTY DAYS AFTER,
 AS APPLICABLE:
   (1)  THE  APPROVAL  OF  A PLAN OF REORGANIZATION BY THE SUPERINTENDENT
 PURSUANT TO SECTION EIGHT THOUSAND ONE HUNDRED SEVEN OR  EIGHT  THOUSAND
 ONE HUNDRED NINETEEN OF THIS ARTICLE, AS THE CASE MAY BE; OR
   (2) THE APPROVAL OF THE SUPERINTENDENT PURSUANT TO SECTION EIGHT THOU-
 SAND ONE HUNDRED TWENTY OF THIS ARTICLE.
   (D)  ANY  ACTION OR PROCEEDING AGAINST THE SUPERINTENDENT OR ANY OTHER
 GOVERNMENTAL BODY OR OFFICER IN CONNECTION WITH ANY ACT TAKEN OR  ORDER,
 REGULATION  OR  RULE  ISSUED PURSUANT TO THIS ARTICLE SHALL BE COMMENCED
 WITHIN ONE HUNDRED TWENTY DAYS FROM THE DATE OF SUCH ACT OR  SIGNING  OF
 SUCH ORDER, REGULATION OR RULE.
   (E) ANY PERSON AGGRIEVED BY ANY ACT TAKEN OR ORDER, REGULATION OR RULE
 ISSUED  PURSUANT TO THIS ARTICLE MAY PETITION FOR JUDICIAL REVIEW IN THE
 MANNER PROVIDED BY ARTICLE SEVENTY-EIGHT OF THE CIVIL PRACTICE  LAW  AND
 RULES,  PURSUANT  TO THE LIMITATIONS PERIOD PRESCRIBED IN SUBSECTION (D)
 OF THIS SECTION. THE PETITION SHALL BE BROUGHT IN THE  JUDICIAL  DEPART-
 MENT EMBRACING THE COUNTY WHEREIN THE ACT WAS TAKEN, OR THE ORDER, REGU-
 LATION  OR  RULE  WAS  ISSUED.  ALL  SUCH PROCEEDINGS SHALL BE HEARD AND
 DETERMINED AS EXPEDITIOUSLY AS POSSIBLE AND WITH LAWFUL PRECEDENCE  OVER
 OTHER  MATTERS. ACTS TAKEN OR ORDERS, REGULATIONS OR RULES ISSUED PURSU-
 ANT TO THIS ARTICLE SHALL NOT BE STAYED OR ENJOINED EXCEPT UPON APPLICA-
 TION AFTER NOTICE TO THE SUPERINTENDENT AND TO THE ATTORNEY GENERAL  AND
 UPON  A  SHOWING  THAT  THE  PETITIONER  HAS A SUBSTANTIAL LIKELIHOOD OF
 SUCCESS AND WILL SUFFER IRREPARABLE HARM IF THE STAY  OR  INJUNCTION  IS
 NOT GRANTED.
   §  8116. PROHIBITED TRANSACTIONS BY OFFICERS, DIRECTORS AND EMPLOYEES.
 NO DIRECTOR, OFFICER, AGENT OR  EMPLOYEE  OF  THE  REORGANIZING  INSURER
 SHALL  RECEIVE ANY FEE, COMMISSION OR OTHER VALUABLE CONSIDERATION WHAT-
 SOEVER, OTHER THAN REGULAR SALARY AND COMPENSATION, FOR  IN  ANY  MANNER
 AIDING, PROMOTING OR ASSISTING IN THE REORGANIZATION EXCEPT AS SET FORTH
 IN THE PLAN APPROVED BY THE SUPERINTENDENT.
   §  8117.  REQUIREMENTS APPLICABLE TO A MUTUAL HOLDING COMPANY. (A) THE
 FOLLOWING PROVISIONS OF THIS ARTICLE ARE APPLICABLE TO A MUTUAL  HOLDING
 COMPANY:
   (1)  THE  FOLLOWING PROVISIONS OF ARTICLE TWELVE OF THIS CHAPTER SHALL
 APPLY TO A MUTUAL HOLDING COMPANY AS THOUGH IT WERE  A  DOMESTIC  MUTUAL
 INSURER:  SECTION  ONE  THOUSAND  TWO HUNDRED ONE OF THIS CHAPTER TO THE
 EXTENT PROVIDED IN SUBSECTION (C) OF THIS SECTION AND SECTIONS ONE THOU-
 SAND TWO HUNDRED TWO, ONE THOUSAND TWO HUNDRED  SIX,  ONE  THOUSAND  TWO
 HUNDRED  EIGHT,  ONE THOUSAND TWO HUNDRED NINE, ONE THOUSAND TWO HUNDRED
 TWELVE, AND ONE THOUSAND TWO HUNDRED FIFTEEN THROUGH  ONE  THOUSAND  TWO
 HUNDRED NINETEEN OF THIS CHAPTER;
   (2) THE PROVISIONS OF THE BUSINESS CORPORATION LAW THAT ARE APPLICABLE
 TO  A  DOMESTIC MUTUAL PROPERTY/CASUALTY INSURER SHALL APPLY TO A MUTUAL
 HOLDING COMPANY AS THOUGH IT WERE A DOMESTIC MUTUAL INSURER; AND
   (3) THE PROVISIONS OF SECTION FOUR THOUSAND  ONE  HUNDRED  SIXTEEN  OF
 THIS  CHAPTER  APPLICABLE TO A DOMESTIC MUTUAL PROPERTY/CASUALTY INSURER
 SHALL BE APPLIED TO A MUTUAL HOLDING COMPANY AS THOUGH ITS MEMBERS  WERE
 VOTING POLICYHOLDERS OF A MUTUAL PROPERTY/CASUALTY INSURER.
   (B)  A MUTUAL HOLDING COMPANY SHALL NOT DISSOLVE, LIQUIDATE OR WIND UP
 AND DISSOLVE EXCEPT THROUGH PROCEEDINGS UNDER SECTION EIGHT THOUSAND ONE
 HUNDRED NINETEEN OF THIS ARTICLE, ARTICLE SEVENTY-FOUR OF  THIS  CHAPTER
 FOR  THE LIQUIDATION OR DISSOLUTION OF THE REORGANIZED INSURER OR AS THE
 SUPERINTENDENT MAY OTHERWISE APPROVE. IN THE EVENT ANY  PROCEEDINGS  ARE
 A. 8164                            11
 
 INSTITUTED  UNDER  ARTICLE SEVENTY-FOUR OF THIS CHAPTER FOR THE COMPLETE
 LIQUIDATION OF REORGANIZED INSURER PURSUANT TO THIS ARTICLE:
   (1)  THE  MUTUAL HOLDING COMPANY FORMED AS PART OF SUCH REORGANIZATION
 SHALL AUTOMATICALLY BECOME A PARTY TO SUCH PROCEEDINGS;
   (2) ALL OF THE MUTUAL HOLDING COMPANY'S ASSETS, INCLUDING ITS HOLDINGS
 OF SHARES IN THE REORGANIZED INSURER OR ANY INTERMEDIATE  STOCK  HOLDING
 COMPANY,  SHALL  BE  DEEMED  ASSETS  OF THE ESTATE OF THE DOMESTIC STOCK
 PROPERTY/CASUALTY INSURER TO THE EXTENT NECESSARY TO SATISFY  CLAIMS  OF
 PERSONS  WHO HAVE CLASS ONE, CLASS TWO, CLASS THREE OR CLASS FOUR CLAIMS
 UNDER SUBSECTION (A) OF SECTION SEVEN THOUSAND FOUR HUNDRED  THIRTY-FIVE
 OF  THIS  CHAPTER  WITH RESPECT TO SUCH DOMESTIC STOCK PROPERTY/CASUALTY
 INSURER; AND
   (3) MEMBERS OF THE MUTUAL HOLDING COMPANY  SHALL  BE  DEEMED  TO  HOLD
 CLASS  SEVEN  CLAIMS  WITH  RESPECT  TO THE MUTUAL HOLDING COMPANY UNDER
 SUBSECTION (A) OF SECTION SEVEN THOUSAND  FOUR  HUNDRED  THIRTY-FOUR  OF
 THIS CHAPTER.
   (C)  THE CHARTER OF THE MUTUAL HOLDING COMPANY SHALL BE FILED WITH THE
 SUPERINTENDENT AND SHALL CONTAIN THE MATTERS REQUIRED TO BE CONTAINED IN
 THE CHARTER OF A DOMESTIC MUTUAL PROPERTY/CASUALTY  INSURER  BY  SECTION
 ONE  THOUSAND  TWO  HUNDRED ONE OF THIS CHAPTER, EXCEPT THAT THE NAME OF
 THE MUTUAL HOLDING COMPANY SHALL CONTAIN THE WORD "MUTUAL" AND SHALL NOT
 CONTAIN THE WORD "INSURANCE", "ASSURANCE" AND THE COMPANY'S POWERS SHALL
 NOT INCLUDE DOING AN  INSURANCE  BUSINESS.  THE  CHARTER  SHALL  CONTAIN
 PROVISIONS STATING THAT:
   (1) IT IS A MUTUAL HOLDING COMPANY ORGANIZED UNDER THIS ARTICLE;
   (2)  ITS  PURPOSE  SHALL  BE  TO HOLD, DIRECTLY OR THROUGH ONE OR MORE
 INTERMEDIATE STOCK HOLDING COMPANIES, GREATER THAN FIFTY PERCENT OF  THE
 VOTING STOCK OF A REORGANIZED INSURER;
   (3) IT SHALL NOT BE AUTHORIZED TO ISSUE VOTING STOCK;
   (4) IT SHALL NOT BE AUTHORIZED TO CONDUCT ANY BUSINESS OTHER THAN THAT
 OF  A  MUTUAL  HOLDING  COMPANY,  EXCEPT FOR THE ACQUISITION, OWNERSHIP,
 MANAGEMENT AND DISPOSITION OF ITS  ASSETS  AND  ALL  ACTIONS  REASONABLY
 INCIDENT THERETO; AND
   (5)  IT SHALL HAVE MEMBERS HAVING THE RIGHTS SPECIFIED IN THIS SECTION
 AND SECTION EIGHT THOUSAND ONE HUNDRED TEN OF THIS ARTICLE  AND  IN  ITS
 CHARTER  AND BY-LAWS.  THE CHARTER SHALL ALSO CONTAIN PROVISIONS SETTING
 FORTH ANY RIGHTS OF MEMBERS OF THE MUTUAL HOLDING COMPANY IN THE SURPLUS
 OF THE MUTUAL HOLDING COMPANY.
   (D) AT LEAST TWO-THIRDS OF THE DIRECTORS OF THE MUTUAL HOLDING COMPANY
 AND OF ANY INTERMEDIATE STOCK HOLDING COMPANY, ALL OF THE MEMBERS OF THE
 COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF THE  MUTUAL  HOLDING
 COMPANY  AND  OF  ANY  INTERMEDIATE STOCK HOLDING COMPANY, AT LEAST TWO-
 THIRDS OF THE MEMBERS OF ANY COMMITTEE RESPONSIBLE FOR MAKING  DECISIONS
 AFFECTING  THE  CAPITAL  STRUCTURE  OR  MERGERS  AND ACQUISITIONS, AND A
 MAJORITY OF THE DIRECTORS ON EACH OTHER COMMITTEE OF THE BOARD OF DIREC-
 TORS OF THE MUTUAL HOLDING COMPANY AND ANY STOCK HOLDING  COMPANY  SHALL
 BE  OUTSIDE  DIRECTORS. THE AGGREGATE PERCENTAGE OF VOTING SECURITIES OF
 THE REORGANIZED INSURER DIRECTLY OR INDIRECTLY OWNED, CONTROLLED OR HELD
 WITH THE POWER TO VOTE, EITHER PERSONALLY OR BY PERSONS (OTHER THAN  THE
 MUTUAL  HOLDING  COMPANY  AND ANY INTERMEDIATE STOCK HOLDING COMPANY) OF
 WHICH THEY ARE DIRECTORS, OFFICERS OR EMPLOYEES, BY  OUTSIDE  DIRECTORS,
 SHALL  NOT  EXCEED  THREE  PERCENT  OR  SUCH LESSER PERCENTAGE AS MAY BE
 DETERMINED BY THE SUPERINTENDENT IN HIS OR HER APPROVAL  OF  THE  MUTUAL
 HOLDING  COMPANY'S  PLAN OF REORGANIZATION PURSUANT TO THIS ARTICLE. THE
 BY-LAWS OF THE MUTUAL HOLDING COMPANY AND ANY INTERMEDIATE STOCK HOLDING
 COMPANY SHALL PROVIDE THAT THE AFFIRMATIVE VOTE OF AT  LEAST  TWO-THIRDS
 A. 8164                            12
 
 OF  THE  BOARD  OF  DIRECTORS  OF SUCH COMPANY SHALL BE REQUIRED FOR ANY
 ACTION BY SUCH COMPANY TO ADOPT A PLAN OF CONVERSION PURSUANT TO SECTION
 EIGHT THOUSAND ONE HUNDRED NINETEEN OF THIS ARTICLE, ENTER INTO A  MERG-
 ER,  CONDUCT  A  PUBLIC OFFERING OR AUTHORIZE THE ISSUANCE OF ANY VOTING
 STOCK OR SECURITY CONVERTIBLE  INTO  VOTING  STOCK  OF  THE  REORGANIZED
 INSURER OR THE STOCK HOLDING COMPANY TO ANY PERSON OTHER THAN THE MUTUAL
 HOLDING COMPANY OR THE STOCK HOLDING COMPANY.
   (E)  THE  SUPERINTENDENT  MAY, BY REGULATION, REQUIRE A MUTUAL HOLDING
 COMPANY TO FILE ANNUAL STATEMENTS WITH THE SUPERINTENDENT IN  SUCH  FORM
 AS THE SUPERINTENDENT SHALL PRESCRIBE.
   (F)  WITH  THE  WRITTEN APPROVAL OF THE SUPERINTENDENT, AND SUBJECT TO
 THE CONDITIONS THAT THE SUPERINTENDENT  MAY  IMPOSE,  A  MUTUAL  HOLDING
 COMPANY OR STOCK COMPANY MAY:
   (1)  MERGE  OR  CONSOLIDATE  WITH,  OR ACQUIRE THE ASSETS OF, A MUTUAL
 HOLDING COMPANY ORGANIZED PURSUANT TO THIS ARTICLE OR  PURSUANT  TO  THE
 LAWS OF ANOTHER STATE;
   (2)  EITHER  ALONE  OR  TOGETHER  WITH  ONE OR MORE OF THE REORGANIZED
 INSURER, ANY INTERMEDIATE STOCK HOLDING COMPANIES OR ANY SUBSIDIARIES OF
 ANY OF THEM, MERGE OR CONSOLIDATE WITH OR ACQUIRE THE ASSETS OF A MUTUAL
 PROPERTY/CASUALTY INSURER;
   (3) MERGE OR CONSOLIDATE WITH ANY OTHER PERSON.
   (G) A MUTUAL HOLDING COMPANY OR ANY INTERMEDIATE STOCK HOLDING COMPANY
 MAY ALSO ACQUIRE THE CAPITAL STOCK OR ASSETS OF OTHER PERSONS.
   (H) A MEMBER OF  A  MUTUAL  HOLDING  COMPANY  IS  NOT,  AS  A  MEMBER,
 PERSONALLY LIABLE FOR THE ACTS, DEBTS, LIABILITIES OR OBLIGATIONS OF THE
 COMPANY.  NO ASSESSMENT OF ANY KIND MAY BE IMPOSED UPON THE MEMBERS OF A
 MUTUAL HOLDING COMPANY BY THE BOARD OF DIRECTORS, MEMBERS  OR  CREDITORS
 OF THE MUTUAL HOLDING COMPANY OR BECAUSE OF ANY LIABILITY OF ANY COMPANY
 OWNED OR CONTROLLED, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, BY THE
 MUTUAL  HOLDING  COMPANY OR BECAUSE OF ANY ACT, DEBT OR LIABILITY OF THE
 MUTUAL HOLDING COMPANY.
   (I) A MEMBERSHIP INTEREST  IN  A  MUTUAL  HOLDING  COMPANY  SHALL  NOT
 CONSTITUTE A SECURITY UNDER THE LAWS OF THIS STATE.
   (J) THE SUPERINTENDENT SHALL RETAIN JURISDICTION OVER ANY MUTUAL HOLD-
 ING COMPANY ORGANIZED PURSUANT TO THIS ARTICLE.
   (K)  DIRECTORS  OF  THE  MUTUAL  HOLDING COMPANY SHALL BE ELECTED BY A
 MAJORITY VOTE OF ALL MEMBERS WHO VOTE IN SUCH ELECTION IN PERSON  OR  BY
 PROXY  OR  AS SET FORTH IN THE BY-LAWS OF THE MUTUAL HOLDING COMPANY. IF
 THE REORGANIZED INSURER TAKES ANY ACTION  OTHER  THAN  ELECTION  OF  ITS
 DIRECTORS  THAT WOULD REQUIRE A VOTE OF POLICYHOLDERS IF THE REORGANIZED
 INSURER WERE A MUTUAL PROPERTY/CASUALTY INSURER, THEN SUCH ACTION  SHALL
 REQUIRE A VOTE OF MEMBERS OF THE MUTUAL HOLDING COMPANY.
   § 8118. OTHER REQUIREMENTS APPLICABLE TO AN INTERMEDIATE STOCK HOLDING
 COMPANY  AND  A MUTUAL HOLDING COMPANY. (A) FROM AND AFTER THE EFFECTIVE
 DATE, THE MUTUAL HOLDING COMPANY SHALL HOLD, DIRECTLY OR THROUGH ONE  OR
 MORE  STOCK HOLDING COMPANIES, MORE THAN FIFTY PERCENT OF THE ISSUED AND
 OUTSTANDING VOTING STOCK OF THE REORGANIZED INSURER. FOR PURPOSES OF THE
 VOTING STOCK OWNERSHIP REQUIREMENT UNDER THIS SUBSECTION, ANY ISSUED AND
 OUTSTANDING SECURITIES OF THE REORGANIZED INSURER OR ANY  STOCK  HOLDING
 COMPANY  THAT  ARE  CONVERTIBLE  INTO  VOTING  STOCK SHALL BE CONSIDERED
 ISSUED AND OUTSTANDING VOTING STOCK.
   (B) A MUTUAL HOLDING COMPANY AND ANY INTERMEDIATE STOCK HOLDING COMPA-
 NY SHALL EACH BE DEEMED TO BE A "HOLDING  COMPANY"  OF  THE  REORGANIZED
 INSURER  WITHIN  THE MEANING OF ARTICLE FIFTEEN OF THIS CHAPTER, AND ALL
 PROVISIONS OF ARTICLE FIFTEEN OF THIS  CHAPTER  SHALL  APPLY  TO  TRANS-
 ACTIONS  OCCURRING BETWEEN THE MUTUAL HOLDING COMPANY, THE STOCK HOLDING
 A. 8164                            13
 
 COMPANY AND THE REORGANIZED INSURER. APPROVAL OF THE PLAN OF REORGANIZA-
 TION BY THE SUPERINTENDENT PURSUANT TO  THIS  ARTICLE  SHALL  CONSTITUTE
 APPROVAL  OF  THE ACQUISITION OF CONTROL BY A MUTUAL HOLDING COMPANY AND
 ANY STOCK HOLDING COMPANY UNDER SECTION ONE THOUSAND FIVE HUNDRED SIX OF
 THIS   CHAPTER,  THE  REGISTRATION  BY  THE  REORGANIZED  INSURER  AS  A
 CONTROLLED INSURER UNDER SECTION ONE THOUSAND FIVE HUNDRED THREE OF THIS
 CHAPTER AND NOTICE OF THE  ACQUISITION  OF  SHARES  OF  THE  REORGANIZED
 INSURER UNDER SECTION FOUR THOUSAND TWO HUNDRED THREE OF THIS CHAPTER.
   (C)  OUTSIDE  DIRECTORS OF THE MUTUAL HOLDING COMPANY, AN INTERMEDIATE
 STOCK HOLDING COMPANY OR THE REORGANIZED INSURER SHALL NOT  OWN  BENEFI-
 CIALLY, IN THE AGGREGATE, MORE THAN THREE PERCENT OF THE VOTING STOCK OF
 THE STOCK HOLDING COMPANY OR THE REORGANIZED INSURER.
   (D) ANY ISSUANCE OF VOTING STOCK OR SECURITIES CONVERTIBLE INTO VOTING
 STOCK  OR  OPTIONS  FOR  THE PURCHASE OF VOTING STOCK OF THE REORGANIZED
 INSURER OR THE STOCK HOLDING COMPANY PRIOR TO AN INITIAL  PUBLIC  OFFER-
 ING,  PRIVATE  EQUITY  PLACEMENT,  OR  THE ISSUANCE OF PUBLIC OR PRIVATE
 VOTING STOCK OR SECURITIES CONVERTIBLE INTO VOTING STOCK OF THE REORGAN-
 IZED INSURER OR STOCK HOLDING COMPANY  OR  ANY  OTHER  TYPE  OF  CAPITAL
 RAISED  SHALL BE SUBJECT TO THE APPROVAL OF THE SUPERINTENDENT AS TO THE
 PROPOSED VALUATION OF SUCH STOCK OR SECURITIES, THE  SUPERINTENDENT  MAY
 IMPOSE  CONDITIONS  UPON  SUCH  APPROVAL, AND ALL EXPENSES OF THE SUPER-
 INTENDENT'S  REVIEW,  INCLUDING  WITHOUT  LIMITATION  THOSE  OF  OUTSIDE
 CONSULTANTS  IN REVIEWING SUCH PROPOSED VALUATION, SHALL BE BORNE BY THE
 ISSUING COMPANY.
   (E) IN THE EVENT OF AN INITIAL PUBLIC OFFERING, AN INTERMEDIATE  STOCK
 HOLDING  COMPANY OR REORGANIZED INSURER MAY NOT REPURCHASE CAPITAL STOCK
 WITHIN ONE YEAR FOLLOWING THE DATE  OF  SUCH  INITIAL  PUBLIC  OFFERING,
 EXCEPT THAT REPURCHASES OF NO GREATER THAN FIVE PERCENT OF THE OUTSTAND-
 ING  STOCK  MAY  BE  REPURCHASED DURING THIS ONE-YEAR PERIOD WITHOUT THE
 APPROVAL OF THE SUPERINTENDENT.
   (F) IN THE EVENT OF ANY VIOLATION OF THIS SECTION, OR  OF  ANY  ACTION
 WHICH, IF CONSUMMATED, MIGHT CONSTITUTE SUCH A VIOLATION:
   (1)  ALL  VOTING  STOCK  OF THE REORGANIZED INSURER, ANY STOCK HOLDING
 COMPANY, OR THE REORGANIZED MUTUAL  HOLDING  COMPANY,  ACQUIRED  BY  ANY
 PERSON  IN EXCESS OF THE MAXIMUM AMOUNT PERMITTED TO BE ACQUIRED BY SUCH
 PERSON PURSUANT TO THIS SUBSECTION SHALL  BE  DEEMED  TO  BE  NON-VOTING
 STOCK; AND
   (2)  IN ADDITION TO ANY OTHER ENFORCEMENT POWERS OF THE SUPERINTENDENT
 UNDER THIS  CHAPTER,  SUCH  VIOLATION  OR  ACTION  MAY  BE  ENFORCED  OR
 ENJOINED,  AS  THE  CASE  MAY BE, BY APPROPRIATE PROCEEDING COMMENCED ON
 BEHALF OF THE REORGANIZED INSURER, ANY  STOCK  HOLDING  COMPANY  OR,  IF
 APPLICABLE,  A  REORGANIZED  MUTUAL  HOLDING COMPANY, BY THE REORGANIZED
 INSURER, THE STOCK HOLDING COMPANY, THE MUTUAL HOLDING  COMPANY  OR  THE
 SUPERINTENDENT,  THE  ATTORNEY GENERAL, ANY MEMBER OF THE MUTUAL HOLDING
 COMPANY OR, IF APPLICABLE, A REORGANIZED MUTUAL HOLDING COMPANY, OR  ANY
 STOCKHOLDER OF THE REORGANIZED INSURER, ANY STOCK HOLDING COMPANY OR THE
 REORGANIZED  MUTUAL HOLDING COMPANY IN THE SUPREME COURT IN THE JUDICIAL
 DISTRICT IN WHICH THE REORGANIZED INSURER HAS ITS HOME OFFICE OR IN  ANY
 OTHER  COURT  HAVING  JURISDICTION,  AND SUCH COURT MAY ISSUE ANY ORDER,
 INJUNCTIVE OR OTHERWISE, IT FINDS NECESSARY TO CURE SUCH VIOLATION OR TO
 PREVENT SUCH ACTION.
   § 8119. CONVERSION OF MUTUAL HOLDING COMPANY.  (A)  A  MUTUAL  HOLDING
 COMPANY MAY REORGANIZE IN ACCORDANCE WITH A PLAN OF REORGANIZATION WHICH
 IS FAIR AND EQUITABLE TO THE COMPANY'S MEMBERS AND IS:
   (1) ADOPTED BY ACTION OF TWO-THIRDS OF ITS ENTIRE BOARD OF DIRECTORS;
 A. 8164                            14
 
   (2)  APPROVED  BY THE SUPERINTENDENT IF FOUND BY THE SUPERINTENDENT TO
 BE FAIR AND EQUITABLE TO THE COMPANY'S MEMBERS AFTER A HEARING HELD UPON
 NOTICE TO THE COMPANY'S MEMBERS; AND, THEREAFTER,
   (3) ADOPTED BY THE AFFIRMATIVE VOTE OF TWO-THIRDS OF ALL VOTES CAST BY
 MEMBERS OF THE COMPANY ENTITLED TO VOTE, AFTER NOTICE BEING GIVEN TO ALL
 MEMBERS  ENTITLED TO VOTE. THE MUTUAL HOLDING COMPANY SHALL GIVE WRITTEN
 NOTICE STATING THE DATE, TIME AND PLACE FOR VOTING ON SUCH  PROPOSAL  TO
 MEMBERS  ENTITLED TO NOTICE OF AND TO VOTE ON THE PROPOSAL IN ACCORDANCE
 WITH THIS SECTION, SENT BY MAIL OR ELECTRONIC TRANSMISSION TO  THE  LAST
 KNOWN  MAILING OR ELECTRONIC ADDRESSES OF SUCH POLICYHOLDERS AS SHOWN ON
 THE RECORDS OF THE MUTUAL HOLDING COMPANY. SUCH NOTICE SHALL BE SENT  AT
 LEAST  FORTY-FIVE  DAYS  BEFORE THE DATE OF THE PROPOSED VOTE TO APPROVE
 THE PLAN OF REORGANIZATION. SUCH NOTICE MAY BE COMBINED WITH  NOTICE  OF
 THE  HEARING  REQUIRED BY PARAGRAPH TWO OF THIS SUBSECTION.  SUCH NOTICE
 SHALL BE PRECEDED OR ACCOMPANIED BY A TRUE AND CORRECT COPY OF THE PLAN,
 OR BY A SUMMARY THEREOF APPROVED BY THE SUPERINTENDENT, AND  SUCH  OTHER
 EXPLANATORY INFORMATION AS THE SUPERINTENDENT SHALL APPROVE OR REQUIRE.
   (B)  A  PLAN  OF  REORGANIZATION  PURSUANT  TO  SUBSECTION (A) OF THIS
 SECTION SHALL PROVIDE FOR THE MEMBERSHIP INTERESTS IN THE MUTUAL HOLDING
 COMPANY BEING EXTINGUISHED AND MAY PROVIDE EITHER FOR:
   (1) THE CONVERSION OF THE MUTUAL HOLDING COMPANY INTO A  STOCK  CORPO-
 RATION,  IN WHICH EVENT CONSIDERATION DISTRIBUTED SHALL BE EQUAL TO THAT
 REQUIRED UNDER SECTION SEVEN THOUSAND THREE HUNDRED SEVEN OF THIS  CHAP-
 TER   OR   SUCH  OTHER  LAW  GOVERNING  THE  DEMUTUALIZATION  OF  MUTUAL
 PROPERTY/CASUALTY INSURERS AS MAY THEN BE IN EFFECT; OR
   (2) THE DISTRIBUTION TO ELIGIBLE MEMBERS OF THE MUTUAL HOLDING COMPANY
 OF CONSIDERATION CONSISTING OF ALL ASSETS OF THE MUTUAL HOLDING  COMPANY
 INCLUDING  ALL  STOCK  OF  THE  REORGANIZED INSURER OR ANY STOCK HOLDING
 COMPANY OWNED BY THE MUTUAL  HOLDING  COMPANY,  OR  OTHER  CONSIDERATION
 HAVING  EQUIVALENT  AGGREGATE  VALUE,  WHICH MAY BE IN THE FORM OF CASH,
 SECURITIES OF ANY INSTITUTION, ADDITIONAL INSURANCE OR ANNUITY  BENEFITS
 OR  POLICY CREDITS, DIVIDENDS OR OTHER CONSIDERATION, ALL SUCH CONSIDER-
 ATION BEING ALLOCATED AMONG  ELIGIBLE  MEMBERS  OF  THE  MUTUAL  HOLDING
 COMPANY IN A MANNER THAT IS FAIR AND EQUITABLE TO THE COMPANY'S MEMBERS.
   §  8120.  TRANSFERS  OF  SUBSIDIARIES.  A  REORGANIZING OR REORGANIZED
 INSURER MAY TRANSFER ANY ONE OR MORE OF ITS SUBSIDIARIES TO  THE  MUTUAL
 HOLDING  COMPANY  OR  TO  ONE OR MORE PERSONS OWNED OR CONTROLLED BY THE
 MUTUAL HOLDING COMPANY, PROVIDED THE REORGANIZING OR REORGANIZED INSURER
 OBTAINS THE PRIOR APPROVAL OF THE SUPERINTENDENT. ANY SUCH TRANSFER  MAY
 BE  MADE  WITHOUT  CONSIDERATION AS A DIVIDEND OR FOR CONSIDERATION THAT
 MAY INCLUDE OBLIGATIONS OF THE MUTUAL HOLDING COMPANY OR OBLIGATIONS  OR
 PREFERRED  SHARES  OF A PERSON OWNED OR CONTROLLED BY THE MUTUAL HOLDING
 COMPANY. THE SUPERINTENDENT SHALL APPROVE EACH SUCH PROPOSED TRANSFER IF
 THE SUPERINTENDENT FINDS IT IS FAIR AND EQUITABLE.  FOR  A  REORGANIZING
 INSURER,  THE PLAN MAY PROVIDE FOR SUCH TRANSFER, IN WHICH CASE APPROVAL
 OF THE PLAN SHALL CONSTITUTE APPROVAL BY THE SUPERINTENDENT PURSUANT  TO
 THIS  SECTION.  THE PROVISIONS OF SECTION ONE THOUSAND FIVE HUNDRED FIVE
 OF THIS CHAPTER SHALL NOT APPLY TO ANY TRANSFER OF SUBSIDIARIES AFFECTED
 PURSUANT TO THIS SECTION BUT SHALL OTHERWISE APPLY  TO  THE  REORGANIZED
 INSURER  AND  ITS AFFILIATES IN ACCORDANCE WITH THEIR TERMS. FOR A REOR-
 GANIZED INSURER, THE OTHER PROVISIONS OF THIS ARTICLE, INCLUDING,  WITH-
 OUT  LIMITATION,  THE  REQUIREMENT  OF  FILING A PLAN OF REORGANIZATION,
 SHALL NOT APPLY  TO  THE  TRANSFER  OF  SUBSIDIARIES  PURSUANT  TO  THIS
 SECTION.
   § 2. This act shall take effect immediately.