NRS693A.445. Application for conversion: Filing and contents; filing fee.

  A converting mutual shall file with the Commissioner an application to convert to a domestic stock insurer. The application must be accompanied by a nonrefundable fee of $2,450. The application must include, without limitation:

      1.  The plan of conversion adopted by the board of directors.

      2.  A certification that the plan of conversion was duly adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual.

      3.  A certification that the plan of conversion is fair and equitable to the policyholders. This certification must be adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual.

      4.  A statement of the reasons for the proposed conversion and why the conversion is in the best interest of the converting mutual, including, without limitation, a:

      (a) Detailed analysis of the risks and benefits of the proposed conversion to the converting mutual and its members; and

      (b) Comparison of the risks and benefits of the conversion with the risks and benefits of a reasonable alternative to the conversion.

      5.  A written opinion addressed to the board of directors of the converting mutual from a qualified, independent financial adviser attesting that the:

      (a) Consideration to be provided to the membership of the converting mutual is fair to the eligible members as a group; and

      (b) Total consideration to be provided to the membership is equal to or greater than the surplus of the converting mutual.

      6.  An opinion from a qualified actuary attesting that all methodologies and formulas used to allocate the consideration among eligible members are reasonable.

      7.  Certified copies of the proposed amendments to the articles of incorporation and bylaws to effect the conversion.

      8.  A copy of the form of the trust agreement of any trust to be used in connection with the conversion.

      9.  A plan of operation for a closed block to preserve the reasonable dividend expectations of eligible members and other policyholders of policies that provide for the distribution of policy dividends.

      10.  A form of the proposed notice to be mailed by the converting mutual to its policyholders as required by NRS 693A.460.

      11.  A 5-year business plan and at least 2 years of financial projections for the new stock insurer and a parent company, if any.

      12.  A list of natural persons who are or have been selected to become directors or officers of the new stock insurer and the following information concerning each person on the list, unless the information is already on file with the Commissioner:

      (a) Occupation;

      (b) Criminal convictions, other than traffic violations, during the immediately preceding 7 years;

      (c) Personal bankruptcy of the person or the spouse of the person during the immediately preceding 7 years;

      (d) Information regarding any consent decree entered into by the person; and

      (e) Whether the person has been refused a fidelity or other bond during the immediately preceding 7 years.

      13.  Any plans that the new stock insurer or its parent company, if any, may have to:

      (a) Raise additional capital through the issuance of stock or otherwise;

      (b) Sell or issue stock to any person;

      (c) Liquidate or dissolve any company or sell any material assets;

      (d) Merge, consolidate or pursue any other form of reorganization with any person; or

      (e) Make any material change in its investment policy, business, corporate structure or management.

      14.  Copies of proposed articles of incorporation and any proposed bylaws of the new stock insurer.

      15.  Such additional information as the Commissioner may by regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the converting mutual, or for the protection of the public interest.

      (Added to NRS by 2001, 2233)