PARRIS N. GLENDENING, Governor Ch. 108

[(8)](9) 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 an
amount not less than one hundred (100) percent of such required capital.

(C) WITHIN 60 DAYS OF THE FILING OF A PLAN THAT CONTAINS ALL OF THE
INFORMATION REQUIRED UNDER THIS SECTION AND ANY REGULATIONS ADOPTED
UNDER THIS SECTION THE COMMISSIONER SHALL APPROVE OR DISAPPROVE THE PLAN.

(D) AT THE EXPENSE OF THE MUTUAL INSURER THE COMMISSIONER MAY
RETAIN ANY QUALIFIED EXPERT WHO IS NOT A PART OF THE STAFF OF THE
COMMISSIONER TO ASSIST IN REVIEWING THE PLAN.

(E) AFTER WRITTEN NOTICE TO THE MUTUAL INSURER AND ANY OTHER
INTERESTED PERSON, THE COMMISSIONER MAY HOLD A HEARING ON WHETHER THE
TERMS OF THE PLAN COMPLY WITH THIS SECTION.

(F) (1) IF A MUTUAL INSURER IS INSOLVENT OR. IN THE JUDGMENT OF THE
COMMISSIONER IS IN A HAZARDOUS FINANCIAL CONDITION, THE BOARD OF DIRECTORS
OF THE MUTUAL INSURER BY A MAJORITY VOTE. MAY REQUEST BY A PETITION AS
PROVIDED UNDER PARAGRAPH (2) OF THIS SUBSECTION THAT THE COMMISSIONER
WAIVE THE REQUIREMENTS CONCERNING THE NOTICE TO, AND APPROVAL BY,
POLICYHOLDERS OF THE PLANNED CONVERSION.

(2) THE PETITION BY THE BOARD OF DIRECTORS SHALL SPECIFY:

(I) THE METHOD AND BASIS FOR ISSUANCE OF THE SHARES OF
CAPITAL STOCK OF THE CONVERTED STOCK INSURER TO AN INDEPENDENT PARTY IN AN
AMOUNT SUFFICIENT TO RESTORE THE CONVERTED STOCK INSURER TO SOUND
FINANCIAL CONDITION; AND

(II) IF THE COMMISSIONER FINDS THAT THE VALUE OF THE MUTUAL
INSURER IS INSUFFICIENT TO WARRANT FINANCIAL CONSIDERATION, THAT THE
CONVERSION SHALL BE ACCOMPLISHED WITHOUT FINANCIAL CONSIDERATION TO
PAST, PRESENT. OR FUTURE POLICYHOLDERS.

(3) (I) BY WRITTEN ORDER THE COMMISSIONER MAY WAIVE THE
REQUIREMENTS OF SUBSECTION (B)(2) OF THIS SECTION IF THE COMMISSIONER FINDS
THAT THE MUTUAL INSURER NO LONGER MEETS STATUTORY REQUIREMENTS WITH
RESPECT TO CAPITAL, SURPLUS, DEPOSITS, OR ASSETS.

(II) ANY FINDING THAT RESULTS IN A WAIVER UNDER THIS
PARAGRAPH SHALL BE MADE AFTER:

1. REVIEW OF THE PLAN; AND

2. A. AN AUDIT OF THE MUTUAL INSURERS QUARTERLY OR
ANNUAL FINANCIAL STATEMENT; OR

B. A FINANCIAL EXAMINATION OF THE MUTUAL INSURER.

(G) THE COMMISSIONER MAY ADOPT REGULATIONS TO ENFORCE THE
PROVISIONS OF THIS SECTION.

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