Oklahoma § 36-2130 - Converting mutual insurer

§ 36-2130. Converting mutual insurer

A. A domestic mutual insurer may become a domestic stock

insurer pursuant to such plan and procedure as is approved in

advance by the Insurance Commissioner.

B. The Commissioner shall not approve any such plan or

procedure unless:

Oklahoma Statutes - Title 36. Insurance

1. Equitable to the insurer's members;

2. Subject to approval by vote of not less than three-fourths

(3/4) of the insurer's current members voting thereon in person, by

proxy, or by mail at a meeting of members called for the purpose

pursuant to such notice and procedure as may be approved by the

Commissioner;

3. The equity of each policyholder in the insurer is

determinable under a fair formula approved by the Commissioner,

which such equity shall be based upon not less than the insurer's

entire surplus (after deducting contributed or borrowed surplus

funds) plus a reasonable present equity in its reserves and in all

nonadmitted assets;

4. The policyholders entitled to participate in the purchase of

stock or distribution of assets shall include all current

policyholders and all existing persons who had been a policyholder

of the insurer within three (3) years prior to the date such plan

was submitted to the Commissioner;

5. The plan gives to each policyholder of the insurer as

specified in paragraph 4 of this subsection, a preemptive right to

acquire his proportionate part of all of the proposed capital stock

of the insurer, within a designated reasonable period, and to apply

upon the purchase thereof the amount of his equity in the insurer as

determined under paragraph 3, above;

6. Shares are so offered to policyholders at a price not

greater than to be thereafter offered to others nor at more than

double the par value of such shares;

7. The plan provides for payment to each policyholder not

electing to apply his equity in the insurer for or upon the purchase

price of stock to which preemptively entitled, of cash in the amount

of not less than fifty percent (50%) of the amount of his equity not

so used for the purchase of stock, and which cash payment together

with stock so purchased, if any, shall constitute full payment and

discharge of the policyholder's equity as an owner of such mutual

insurer; and

8. The plan, when completed, would provide for the converted

insurer paid-in capital stock in an amount not less than the minimum

paid-in capital required of a domestic stock insurer transacting

like kinds of insurance, together with surplus funds in amount not

less than one-half (1/2) of such required capital.

Laws 1957, p. 312, § 2130.