Plans of Division; Requirements; Amendment

  1. Law
  2. Georgia Code
  3. Insurance
  4. Domestic Stock and Mutual Insurers
  5. Division of Domestic Insurers
  6. Plans of Division; Requirements; Amendment

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  1. Any domestic insurer may, in accordance with the requirements of this article, divide into two or more resulting insurers pursuant to a plan of division.
    1. A plan of division shall include:
      1. The name of the dividing insurer seeking to divide;
      2. The name of each resulting insurer or insurers that will be created by the proposed division, including its proposed articles of incorporation and proposed bylaws;
      3. The manner of allocating between or among the resulting insurers:
        1. The property of the dividing insurer that will not be owned by all of the resulting insurers as tenants in common pursuant to Code Section 33-14-125; and
        2. Those policies and other liabilities of the dividing insurer to which not all of the resulting insurers will be jointly and severally liable pursuant to paragraph (3) of subsection (a) of Code Section 33-14-126;
      4. The manner of distributing shares in a new insurer to the dividing insurer or its shareholders;
      5. A reasonable description of liabilities, capital, surplus, or other property the dividing insurer proposes to allocate to a new insurer, including the manner by which each reinsurance contract is to be allocated;
      6. All terms and conditions required by the laws of this state or the articles of incorporation or bylaws of the dividing insurer; and
      7. All other terms and conditions of the division.
    2. If the dividing insurer will survive the division, the plan of division shall include, in addition to the information required by paragraph (1) of this subsection:
      1. All proposed amendments to the dividing insurer's articles of incorporation and bylaws, if any;
      2. If the dividing insurer desires to cancel some but not all shares in the dividing insurer, the manner in which it will cancel such shares; and
      3. If the dividing insurer desires to convert some but not all shares in the dividing insurer into interests, securities, shares, obligations, money, other property, or rights to acquire interests, securities, or shares, or any combination thereof, a statement disclosing the manner in which it will convert such shares.
    3. If the dividing insurer will not survive the proposed division, the plan of division shall contain, in addition to the information required by paragraph (1) of this subsection, the manner in which the dividing insurer will cancel or convert shares in the dividing insurer into interests, securities, shares, obligations, money, other property, or rights to acquire interests, securities, or shares, or any combination thereof.
  3. A dividing insurer may amend a plan of division in accordance with any procedures set forth in the plan or, if no such procedures are set forth in the plan, in any manner determined by the board of directors of the dividing insurer, except that a shareholder that was entitled to vote on or consent to approval of the plan of division is entitled to vote on or consent to any amendment of the plan that will change:
    1. The amount or kind of interests, securities, shares, obligations, money, other property, or rights to acquire interests, securities, or shares, or any combination thereof, to be received by any of the shareholders of the dividing insurer under the plan;
    2. The articles of incorporation of any resulting insurer that will be in effect when the division becomes effective, except for changes that do not require approval of the shareholders of the resulting insurer under its articles of incorporation; or
    3. Any other terms or conditions of the plan, if the change would adversely affect the shareholders in any material respect.
    1. A dividing insurer may abandon a plan of division after it has approved the plan without any action by the shareholders and in accordance with any procedures set forth in the plan or, if no such procedures are set forth in the plan, in a manner determined by the board of directors of the dividing insurer.
    2. A dividing insurer may abandon a plan of division after it has delivered a certificate of division to the Secretary of State by delivering to the Secretary of State a certificate of abandonment signed by the dividing insurer. The certificate of abandonment shall be effective on the date it is filed with the Secretary of State, and the dividing insurer shall be deemed to have abandoned its plan of division on such date.
    3. A dividing insurer may not abandon its plan of division once the division becomes effective.

(Code 1981, §33-14-121, enacted by Ga. L. 2019, p. 474, § 1/SB 156.)


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