4. a. Upon the affirmative vote of not less than three-fourths of the members of the entire board of directors of the mutual insurer, the mutual insurer shall file with the commissioner an application for approval of, and permission to reorganize pursuant to, a plan of reorganization. The application shall include the following:

(1) The plan of reorganization and exhibits thereto which shall include:

(a) an explanation of the manner and basis upon which the reorganization shall occur;

(b) the method of allocation of the consideration to be distributed to policyholders, including an actuarial certification of the reasonableness and appropriateness of the methodology used to allocate consideration among eligible policyholders; and

(c) the method by which the dividend expectations of policyholders will be preserved including, if the plan utilizes a closed block, the plan of operation of the closed block and an actuarial certification of the reasonableness and sufficiency of the assets allocated to the closed block;

(2) A fairness opinion addressed to the board of directors of the mutual insurer from a qualified, nationally recognized investment banker that the provision of common stock, cash and policy benefits upon the extinguishment of the policyholders’ membership interests pursuant to the plan of reorganization is fair to the eligible policyholders, as a group, from a financial point of view;

(3) A business plan of the reorganized insurer including five-year financial projections;

(4) A certification that the plan of reorganization has been duly adopted by action of not less than three-fourths of the members of the entire board of directors of the mutual insurer;

(5) The actuarial memoranda accompanying the certifications of the independent actuary appointed by the mutual insurer as required by paragraph (4) of subsection d. of section 3 of this act;

(6) Certified copies of the proposed charter or certificate of incorporation and bylaws of the reorganized insurer;

(7) The proposed forms of the notice of hearing to policyholders and for publication required by subsection d. of this section and the notice of the meeting of policyholders required by subsection c. of section 5 of this act, and any other notices required by the plan of reorganization;

(8) Any information provided to the board of directors of the mutual insurer in connection with its review and approval of the plan of reorganization, except materials that are protected by attorney-client privilege;

(9) Any other additional information that the mutual insurer believes is necessary; and

(10) Any other additional information that the commissioner in his sole discretion deems necessary.

b. The commissioner in his sole discretion shall determine, within thirty days of submission of the application, whether the application is complete and whether the forms of notice submitted pursuant to paragraph (7) of subsection a. of this section are adequate and may be provided to policyholders.

c. The application and supporting documents shall be public documents except that the business plan, the financial projections, the actuarial memoranda and any other information that the commissioner determines could result in harm to the mutual insurer, harm to the reorganized insurer, or a reduction of values to eligible policyholders, if disclosed, shall be considered confidential. This confidentiality will not extend to information provided by the mutual insurer that the commissioner deems necessary to be provided to policyholders to evaluate the plan of reorganization.

d. Upon determining that the application is complete and the forms of notice are adequate, the commissioner shall designate a date for a public hearing on the plan of reorganization. The public hearing may be held on one or more days, the first commencing within 90 days after the date on which the commissioner determines the application is complete, unless the mutual insurer requests, and the commissioner agrees to, a longer period for the purpose of preparing and distributing the notices required by this subsection and subsection c. of section 5 of this act. The hearing shall be in the nature of a legislative hearing and shall not constitute or be considered, a contested case under the “Administrative Procedure Act,” P.L.1968, c.410 (C. 52:14B-1 et seq.). The mutual insurer shall provide policyholders with at least 45 days’ notice of the hearing, the notice to be in the form, and provided in the manner, that the commissioner approves pursuant to subsection b. of this section. The mutual insurer shall cause notice of the time and place of the public hearing to be published at least two times at intervals of not less than one week, the first publication to be not more than 45 days and the last publication not less than 15 days prior to the public hearing in at least two newspapers of general circulation throughout the United States. The notice of the hearing shall state the purpose thereof and the time and the place where the hearing will occur. The purpose of the hearing shall be to receive comments and information for the purpose of aiding the commissioner in making a decision on the plan of reorganization. Persons wishing to make comments and submit information may submit written statements prior to the public hearing and may appear and be heard at the hearing.

e. The hearing shall be conducted by the commissioner or, at the commissioner’s discretion, his designee, who shall report to and advise the commissioner on the matter, and the determination or order issued by the commissioner shall have the same force and effect as if the commissioner had conducted the hearing personally. The commissioner’s order or determination shall be issued within 45 days after the closing of the record of the hearing by the commissioner or the hearing officer, as applicable, which record shall not be closed until the time it includes certification of the vote on the plan of reorganization by the mutual insurer’s qualified voters as required by section 5 of this act. The commissioner shall issue a written decision detailing the reasons why the mutual insurer’s plan of reorganization is approved or disapproved.

f. The commissioner shall approve the application and permit the reorganization pursuant to the plan of reorganization if he finds, following a public hearing, that: (1) the application conforms to the requirements of this section; (2) the plan is fair and equitable to the policyholders of the mutual insurer; (3) the plan promotes the best interest of the mutual insurer and its policyholders; (4) the plan provides for the enhancement of the operations of the reorganized insurer; (5) the plan is not contrary to law; (6) the plan is not detrimental to the public; and (7) after giving effect to the reorganization, the reorganized insurer will have an amount of capital and surplus the commissioner deems to be reasonably necessary for its future solvency.

g. The commissioner may engage the services of advisors and consultants, which may include, but are not limited to, lawyers, actuaries, accountants, investment bankers, compensation and employee benefit plan consultants or any combination thereof, to advise him on any matters related to the reorganization. All reasonable costs related to the development and examination of, and deliberations concerning, a plan of reorganization and other related matters, including those reasonable costs attributable to the use by the commissioner of advisors and consultants, shall be paid by the mutual insurer that makes the filing or initiates the discussions about a plan of reorganization for services prior to the effective date and by the reorganized insurer for services after the effective date.

h. The commissioner’s order approving or disapproving a plan of reorganization shall be a final agency decision subject to appeal in accordance with, and within the time periods specified by, the Rules Governing the Courts of the State of New Jersey.

L.1998,c.46,s.4.