§ 7312. Reorganization of a domestic mutual life insurer into a\ndomestic stock life insurer. (a) Definitions. As used in this section,\nthe following terms shall have the following meanings:\n (1) "Mutual life insurer" means a domestic mutual life insurer.\n (2) "Policyholder" means a person, as determined by the records of a\nmutual life insurer, who is deemed to be the "policyholder" of a policy\nor annuity contract which is of a type described in paragraphs one, two\nor three of subsection (a) of section one thousand one hundred thirteen\nof this chapter for purposes of paragraph three of subsection (a) of\nsection four thousand two hundred ten of this chapter.\n (3) "Policyholders' membership interest" means and includes all\npolicyholders' rights as members arising under the charter of the mutual\nlife insurer or this chapter or otherwise by law including, but not\nlimited to, the rights to vote and to participate in any distribution of\nsurplus whether or not incident to a liquidation of the mutual life\ninsurer. The term "policyholders' membership interest" does not include\nrights, including without limitation the right to participate in the\ndistribution of surplus, expressly conferred upon the policyholders by\ntheir policies or contracts other than any right to vote.\n (4) "Plan of reorganization" means a plan of conversion or conversion\nand merger in accordance with this section.\n (5) "Reorganized insurer" means the domestic stock life insurer into\nwhich a mutual life insurer has been reorganized in accordance with this\nsection.\n (6) "Statement date" means the December thirty-first immediately prior\nto the date the plan of reorganization was adopted.\n (7) "Person" means an individual, partnership, firm, association,\ncorporation, joint-stock company, trust, any similar entity or any\ncombination of the foregoing acting in concert.\n (b) Demutualization. Any other provision of this chapter to the\ncontrary notwithstanding, upon compliance with the requirements of and\ncompletion of the proceedings prescribed by this section and with the\nwritten approval of the superintendent, a mutual life insurer may either\n(1) reorganize into a domestic stock life insurer or (2) reorganize as\npart of a plan of reorganization in which a majority or all of the\ncommon shares of the domestic stock life insurer is acquired by another\ninstitution which may be an institution organized for such purpose. As\npart of the reorganization, the mutual life insurer may merge with a\ndomestic stock insurer, provided that the merging insurers shall comply\nwith the provisions of this chapter applicable to their participation in\nsuch a merger.\n (c) Plan of reorganization. A plan of reorganization must: (1)\ndemonstrate a purpose and specify reasons for the proposed\nreorganization; (2) be in the best interest of the mutual life insurer\nand its policyholders; (3) be fair and equitable to policyholders; (4)\nprovide for the enhancement of the operations of the reorganized\ninsurer; and (5) not substantially lessen competition in any line of\ninsurance business.\n (d) Reorganization. The proposed reorganization shall be accomplished\nby a plan which must be fair and equitable to the policyholders and must\ncomply with the terms and conditions set forth in paragraph one, two or\nfour of this subsection provided however, that a mutual life insurer\nwhich has surplus to policyholders, excluding contingently repayable\nobligations of the mutual life insurer under section one thousand three\nhundred seven of this chapter, of less than fifty million dollars and\nwhich has industrial insurance in force must comply with the terms and\nconditions set forth in paragraph one, two, three or four of this\nsubsection. Nothing herein contained shall be deemed to give any class\nof policyholders priority with respect to the assets of any such\nreorganized insurer in liquidation, other than as expressly stated in\nparagraph two of this subsec
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