515G.3 Plan of conversion. 1. A plan of conversion shall include all of the following:a. The proposed articles of incorporation and bylaws of the mutual insurer as a stock company. b. The manner of treating a holder of a surplus note agreement, if any. The holder of a surplus note agreement, if otherwise qualified, may, at its option, exchange the agreementfor an equitable share of the securities or other consideration, or both, of the corporation intowhich the insurer is to be converted. c. The manner and basis of exchanging the rights of each voting policyholder and each eligible policyholder of the mutual insurer to be converted to a stock company pursuantto this chapter. Such exchange may include a base value for each voting policyholder in recognition of the voting policyholder’s voting rights as a mutual policyholder as wellas consideration to be provided to each eligible policyholder in exchange for the eligiblepolicyholder’s rights as a mutual policyholder of the mutual insurer to be converted. Afterdetermining the base value to be provided to each voting policyholder in recognition of thevoting rights of the voting policyholder, the equitable share of each eligible insurer to be converted. Afterdetermining the base value to be provided to each voting policyholder in recognition of thevoting rights of the voting policyholder, the equitable share of each eligible policyholder inthe remaining statutory surplus of the mutual insurer, plus any adjustments for nonadmittedassets or additional value permitted by the commissioner, to be provided to each eligiblepolicyholder shall be determined by the ratio which the net earned premiums the eligiblepolicyholder has properly and timely paid to the mutual insurer on insurance policiesin effect during the three-year period immediately preceding the adoption of the plan ofconversion, including the date of the adoption of the plan of conversion, bears to the total netearned premiums received by the mutual insurer from all eligible policyholders during thatthree-year period. The base value to be provided to each voting policyholder in recognitionof voting rights and the equitable share of each eligible policyholder may be exchanged,without additional payment, for securities or other consideration, or both, of the stockcorporation or an affiliate into which the mutual insurer is to be converted. ble policyholder may be exchanged,without additional payment, for securities or other consideration, or both, of the stockcorporation or an affiliate into which the mutual insurer is to be converted. If the base valuefor each voting policyholder or the equitable share of each eligible policyholder entitles thepolicyholder to the purchase of a fractional share of stock, the policyholder has the optionto receive the value of the fractional share in cash or purchase a full share by paying thebalance in cash. However, policyholders due a de minimis amount, as established by thecommissioner, need not be offered the value of the fractional share or the option to purchasea full share. The plan shall also provide for the disposition of any unclaimed shares. d. The number of voting common shares proposed to be authorized for the stock corporation, their par value, and the price at which they shall be offered. 2. A plan of conversion for an insurer organized on the mutual plan under chapter 491, shall also provide for conversion to a stock company as follows: the insurer organized on themutual plan under chapter 491 shall amend its articles pursuant to chapter 491 as necessaryto become a 91, shall also provide for conversion to a stock company as follows: the insurer organized on themutual plan under chapter 491 shall amend its articles pursuant to chapter 491 as necessaryto become a stock company, and shall immediately convert to a chapter 490 corporation asprovided in section 490.1801 upon becoming a stock company. 90 Acts, ch 1083, §3; 2006 Acts, ch 1117, §76; 2012 Acts, ch 1023, §157; 2020 Acts, ch 1062, §57; 2021 Acts, ch 165, §229, 230 Referred to in §515G.5 Sat Dec 23 00:49:09 2023 Iowa Code 2024, Section 515G.3 (18, 0)
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