§431:4-120  Subsequent financing.  (a) No domestic insurer, insurance holding corporation, stock corporation forfinancing operations of a mutual insurer, or attorney-in-fact corporation of areciprocal insurer shall solicit or receive funds in exchange for any new issueof its corporate securities, other than through a stock dividend, until it hasapplied to the commissioner for, and has been granted, a solicitation permit,after:

(1)  It has received a certificate of authority, if aninsurer, or

(2)  It has completed its initial organization andfinancing, if a corporation other than an insurer.

(b)  The commissioner shall issue asolicitation permit unless the commissioner finds that:

(1)  The funds proposed to be secured are excessive inamount for the purpose intended,

(2)  The proposed securities or the manner of theirdistribution are inequitable, or

(3)  The issuance of the securities would jeopardizethe interests of policyholders or the holders of other securities of theinsurer or corporation.

(c)  A solicitation permit shall contain suchterms and be issued upon such conditions as the commissioner may reasonablyspecify or require, and shall expire when the new issue of corporate securitieshas been completed.

(d)  A solicitation permit shall limit theportion of funds received on account of such new issue of corporate securitieswhich may be used for promotion and sales expenses for the new issue to suchamount as the commissioner deems adequate, but in no event to exceed fifteenper cent of such funds as and when actually received.

(e)  For purposes of this section, insuranceholding corporation means any domestic corporation:

(1)  Which, directly or indirectly through one or moreintermediaries, controls a domestic insurer; and

(2)  In which the total assets of the insurer, asreported in its most recent annual statement filed with the commissionerpursuant to section 431:3-301, is twenty per cent or more of the consolidatedtotal assets of the corporation as reported in its most recent annual report toits owners.  The annual report to owners shall be prepared in accordance withgenerally accepted accounting principles by a certified public accountant. [L1987, c 347, pt of §2; am L 1989, c 207, §3]