Montana Code 33-28-111. Captive mergers
33-28-111. Captive mergers. (1) A merger between captive stock insurers must meet the requirements of 33-3-217 and 33-28-105, except that the commissioner may provide notice to the public of the proposed merger prior to approval or disapproval of the merger in place of holding a hearing, at the commissioner’s discretion.
Terms Used In Montana Code 33-28-111
- Association: means any legal association of sole proprietorships or business entities that has been in continuous existence for at least 1 year unless the 1-year requirement is waived by the commissioner and the members of which collectively, or the association itself:
(a)owns, controls, or holds with power to vote all of the outstanding voting securities of an association captive insurance company incorporated as a stock insurer;
(b)has complete voting control over an association captive insurance company incorporated as a mutual insurer;
(c)constitutes all of the subscribers of an association captive insurance company formed as a reciprocal insurer; or
(d)owns, controls, or holds with power to vote all of the outstanding ownership interests of an association captive insurance company organized as a limited liability company. See Montana Code 33-28-101
- Attorney-in-fact: A person who, acting as an agent, is given written authorization by another person to transact business for him (her) out of court.
- Captive insurance company: means any pure captive insurance company, association captive insurance company, protected cell captive insurance company, special purpose captive insurance company, or industrial insured captive insurance company formed or authorized under the provisions of this chapter. See Montana Code 33-28-101
- Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. Source: U.S. Courts
- Industrial insured: means an insured:
(a)who procures the insurance of any risk or risks by use of the services of a full-time employee acting as an insurance manager or buyer;
(b)whose aggregate annual premiums for insurance on all risks total at least $25,000; and
(c)who has at least 25 full-time employees. See Montana Code 33-28-101
- Mutual insurer: means a business entity without capital stock and with a governing body elected by the policyholders. See Montana Code 33-28-101
- Person: includes a corporation or other entity as well as a natural person. See Montana Code 1-1-201
- Quorum: The number of legislators that must be present to do business.
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
(2)A merger between captive mutual insurers must meet the requirements of 33-3-218 and 33-28-105, except that the commissioner may provide notice to the public of the proposed merger prior to approval or disapproval of the merger in place of holding a hearing, at the commissioner’s discretion.
(3)(a) An association captive insurance company or industrial insured group formed as a stock or mutual insurer may be converted to or merged with a reciprocal insurer pursuant to this section.
(b)A plan for conversion or merger must:
(i)be fair and equitable to the shareholders in the case of a stock insurer or the policyholders in the case of a mutual insurer; and
(ii)provide for the purchase of the shares of any nonconsenting shareholder of a stock insurer or the policyholder interest of any nonconsenting policyholder of a mutual insurer.
(c)In order to convert to a reciprocal insurer, the conversion must be accomplished under a reasonable plan and procedure approved by the commissioner. The commissioner may not approve the plan unless it:
(i)provides for a hearing upon notice to the insurer, directors, officers, and stockholders or policyholders who have the right to appear at the hearing, unless the commissioner waives or modifies the requirements for the hearing;
(ii)provides for the conversion of the existing stockholder or policyholder interests into subscriber interests in the resulting reciprocal insurer proportionate to stockholder or policyholder interests;
(iii)(A) in the case of a stock insurer, is approved by a majority of the shareholders who are entitled to vote and who are represented at a regular or special meeting at which a quorum is present either in person or by proxy; or
(B)in the case of a mutual insurer, by a majority of the voting interests of the policyholders who are represented at a regular or special meeting at which a quorum is present either in person or by proxy; and
(iv)meets the requirements of 33-28-105.
(d)If the commissioner approves a plan of conversion, the certificate of authority for the converting insurer must be amended to state that it is a reciprocal insurer. The conversion is effective and the corporate existence of the converting entity ceases to exist on the date on which the amended certificate is issued to the attorney-in-fact of the reciprocal insurer. The resulting reciprocal insurer shall file the articles of the merger or conversion with the secretary of state.