Oklahoma § 36-2126 - Prohibited interests of officers, directors in certain

§ 36-2126. Prohibited interests of officers, directors in certain

transactions.

A. No director or officer of an insurer, organized under the

laws of this state, and no person who is directly or indirectly the

beneficial owner of more than ten percent (10%) of any class of

equity security of any such insurance company, shall receive, except

as permitted by this section, any money or valuable thing, either

directly or indirectly or through any substantial interest in any

other corporation, firm or business unit for negotiating, procuring,

recommending or aiding in any purchase, sale or exchange of property

or loan, made by any such company or any subsidiary thereof; nor

shall he be pecuniarily interested, either as principal,

coprincipal, agent or beneficiary, either directly or indirectly, or

through any substantial interest in any other corporation, firm or

business unit, in any such purchase, sale, exchange or loan; nor

shall such company make any loan to or guarantee the financial

obligation of any such director, officer or shareholder, either

directly or indirectly, or through its subsidiaries, nor shall any

such director, officer or shareholder accept any such loan or

guarantee either directly or indirectly.

B. 1. "Person", as used herein, shall mean an individual, a

corporation, a partnership, an association, a joint-stock company, a

business trust or an unincorporated organization; and

2. "Subsidiary", as used herein, shall mean any corporation in

which an insurance company owns fifty percent (50%) or more of any

class of equity securities of such corporation, or which is managed

by or is directly or indirectly controlled by or is subject to

control by an insurance company.

C. Nothing in this section shall be construed as prohibiting

the following:

1. Any such director, officer or shareholder from becoming a

policyholder of the insurance company and enjoying the usual rights

of a policyholder or from participating as beneficiary in any

pension plan, deferred compensation plan, profit-sharing or bonus

plan, stock option plan, or similar plan adopted by the insurance

company and to which he may be eligible under the terms of such

plan; or prohibit any such director, officer or shareholder from

receiving salaries, bonuses and other remuneration for services

rendered to the insurance company as an employee and not in

violation of other provisions of the Insurance Code;

Oklahoma Statutes - Title 36. Insurance

2. Professional services performed by such directors for duties

not placed by law upon a director and director's fees and expense

reimbursement for the performance of their duties as directors;

3. The approval and payment of lawful dividends to

policyholders and shareholders;

4. Any other arms-length transaction not forbidden by other

statutes between such directors, officers and shareholders and such

insurance company provided such transactions are approved prior to

the making thereof by the Commissioner;

5. Any transactions within an insurance holding company system

by insurers with their holding companies, subsidiaries or affiliates

that are not prohibited by law, that meet the test of being fair and

proper, and that are regulated by other statutes; or

6. Any transactions or arrangements not prohibited by law that

meet the test of being fair and proper.

Amended by Laws 1983, c. 99, § 4, emerg. eff. May 9, 1983; Laws

1987, c. 175, § 21, eff. Nov. 1, 1987.