The commissioner may hold a public hearing to consider an
application for approval of a stock offering. Upon receipt of an application
for approval of an offering that includes an initial stock offering, the
commissioner may hold a public hearing at which all interested parties may
appear and present evidence and argument regarding the applicant's planned
offering. If a hearing is held, the commissioner must publish notice of the
hearing in at least one newspaper of general circulation in the state. The
applicant must provide its policyholders with notice of the hearing at least
twenty, but not more than sixty, days prior to the hearing by regular mail. The
notice must be approved by the commissioner. Following the hearing, the
commissioner may approve, conditionally approve, or deny the application.
1. The commissioner must approve the
offering if the applicant demonstrates clearly that:
a. The offering complies with this chapter
and other provisions of law;
b.
The method for establishing the price of the offering is consistent with
generally accepted market or industry practices; and
c. The plan and offering will not be unfair
or contrary to the financial interests of the members of the mutual insurance
holding company.
2. In
determining whether the application and offering will not be unfair to or
contrary to the financial interests of the members of the mutual insurance
holding company, the commissioner may consider the following:
a. Whether the offering will dilute a current
member's interest;
b. Whether the
application provides a method whereby accumulated earnings, cash, or other
nonoperating assets are distributed to or otherwise inure to the fair and
equitable benefit of the eligible members, members, and new members;
c. Whether the offering will create a class
of security holders with interests adverse to those of the members;
d. Whether the application and offering
require a member to pay additional funds to keep a membership interest;
e. Whether the application and
offering create an opportunity for the officers or directors of the mutual
insurance holding company, its subsidiaries, or affiliates to enrich themselves
at the expense of members;
f.
Whether the offering will diminish a policyholder's contractual rights; and
g. Such other factors that the
commissioner may deem necessary. This section does not prohibit the filing of a
registration statement with the securities and exchange commission.
