Texas Insurance Code

§ 826.058 — SUBSCRIPTION RIGHTS; GENERAL PROVISIONS

IN § 826.058Title 6. ORGANIZATION OF INSURERS AND RELATED ENTITIES · Part B. ORGANIZATION OF REGULATED ENTITIES · Ch. 826. CONVERSION OF MUTUAL INSURANCE COMPANY TO STOCK INSURANCE COMPANY · Art. B. CONVERSION PLAN ADOPTION AND REQUIREMENTS

Statute text

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(a)Except for an alternate conversion plan adopted under Section 826.061, each conversion plan must specify the subscription rights of eligible members.

(b)The conversion plan must provide that:

(1)each eligible member is to receive, without payment by the member, nontransferable subscription rights to purchase a portion of the capital stock of the resulting company; and

(2)in the aggregate, all eligible members have the right, before the right of any other party, to purchase 100 percent of the capital stock of the resulting company after provision for:

(A)capital stock required to be sold or distributed to the holders of surplus notes, if any;

(B)capital stock purchased by a stock benefit plan as permitted by Section 826.059; and

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Legislative history

Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.