Section 7118. Plan for acquisition of minority interests in a subsidiary insurer

(a) Definitions. In this section:    (1) "Parent" means a corporation  directly  or  indirectly  owning  at
  least ninety-five percent of the aggregate issued and outstanding shares
  of all classes of voting shares of a subsidiary.
    (2) "Subsidiary"  means  a domestic company whose voting shares are so
  owned.
    (b) Any parent or subsidiary may, pursuant to a plan  for  acquisition
  of  minority  interests  in  such  subsidiary,  adopted  by the board of
  directors, trustees or other governing body of the parent or subsidiary,
  acquire all of the subsidiary's remaining issued and outstanding  voting
  shares,   by   exchange   of   shares,  other  securities,  cash,  other
  consideration or any combination thereof.
    (c) Such plan shall set forth:
    (1) the name of the subsidiary;
    (2) the total number of issued and outstanding voting shares  of  each
  class  of  the  subsidiary, the number of its shares owned by the parent
  and, if either of the foregoing  is  subject  to  change  prior  to  the
  effective date of acquisition, the manner in which any change may occur;
    (3)  the  terms  and  conditions of the plan, including the manner and
  basis of exchanging the shares  to  be  acquired  for  shares  or  other
  securities  of  the  parent,  for  cash,  other  consideration,  or  any
  combination of the foregoing, the proposed effective date of acquisition
  and a statement clearly describing the rights of dissenting shareholders
  to demand appraisal;
    (4) if the parent has adopted the  plan  and  is  neither  a  domestic
  corporation  nor  an  authorized  insurer,  its agreement to be bound by
  section seven thousand one hundred nineteen of this article with respect
  to the plan, its consent to the enforcement against it in this state  of
  the  rights  of  shareholders pursuant to the plan, and a designation of
  the superintendent as the agent upon whom process may be served  against
  the  parent  in the manner set forth in section one thousand two hundred
  twelve of this chapter in any action or proceeding to enforce  any  such
  rights; and
    (5)  such  other  provisions  with respect to the plan as the board of
  directors,  trustees  or  other  governing  body  deems   necessary   or
  desirable, or which the superintendent may prescribe.
    (d)  Upon  adoption of the plan, it shall be executed by the president
  and attested by the secretary, or officers corresponding  to  either  of
  them,  under  the  corporate  seal of the parent or subsidiary which has
  adopted the plan, as the case may be. Thereupon, a certified copy of the
  plan, together with a certificate of its  adoption  subscribed  by  such
  officers and affirmed by them as true under the penalties of perjury and
  under  the  seal  of  the  parent or the subsidiary, as the case may be,
  shall  be  submitted  to  the  superintendent  for  his  approval.   The
  superintendent  shall thereupon consider the plan and, if satisfied that
  it  complies  with  this  article,  is  fair  and  equitable   and   not
  inconsistent  with law, he shall approve the plan. If the superintendent
  disapproves the plan, notification of  his  disapproval,  assigning  the
  reasons  therefor,  shall  be  given  in writing by him to the parent or
  subsidiary that submitted the plan. No plan shall take effect unless the
  approval of the superintendent has been obtained.
    (e) If the  superintendent  approves  the  plan,  the  parent  or  the
  subsidiary  which has adopted the plan shall deliver to each person who,
  as of the date of delivery, is a  holder  of  record  of  shares  to  be
  acquired,  a  copy  of  the  plan,  or a summary thereof approved by the
  superintendent, in person or by depositing the same in the post  office,
  postage  prepaid, addressed to the shareholder at his address of record.

  On or before the date of acquisition proposed in the plan, the parent or
  the  subsidiary  which  has  adopted  the  plan  shall  file  with   the
  superintendent  a certificate, executed by its president and attested by
  its  secretary,  or  by  officers  corresponding  to either of them, and
  subscribed by such officers and affirmed  by  them  as  true  under  the
  penalties  of  perjury,  and  under  the  seal  of  the  parent  or  the
  subsidiary, as the case  may  be,  attesting  to  compliance  with  this
  subsection.
    (f)  Upon  compliance with this section, ownership of the shares to be
  acquired pursuant to the plan shall vest in the parent or the subsidiary
  which has adopted the plan on the date of acquisition  proposed  in  the
  plan  whether  or  not  the  certificates  for  such  shares  have  been
  surrendered for exchange. If the plan was adopted by the parent it shall
  be entitled to have new certificates registered in its  name.    If  the
  plan  was  adopted by the subsidiary the shares shall be retired and the
  capital of the subsidiary reduced  by  the  par  value  of  the  retired
  shares. Shareholders whose shares have been so acquired shall thereafter
  retain  only the right either to receive the consideration to be paid in
  exchange for their shares pursuant to the plan or  to  demand  appraisal
  pursuant to section seven thousand one hundred nineteen of this article.
    (g) Neither the right granted by this section nor the exercise thereof
  by a parent or subsidiary shall preclude the exercise by it of any other
  rights it may have under this article.