Current through Register Vol. XLI, No. 45, November 8, 2024
Section 114-1-2 - Procedures2.1. Application of regulation. -- This regulation is applicable to all domestic stock insurers having one hundred (100) or more stockholders: Provided, however, That this regulation shall not apply to any insurer if ninety-five percent (95%) or more of its stock is owned or controlled by a parent or an affiliated insurer and the remaining shares are held by less than five hundred (500) stockholders. A domestic stock insurer which files with the Securities and Exchange Commission forms of proxies, consents and authorizations complying with the requirements of the Securities and Exchange Act of 1934 and the Securities and Exchange Acts Amendments of 1964 and Regulation X-14 of the Securities and Exchange Commission promulgated thereunder shall be exempt from the provisions of this regulation.2.2. Proxies, consents and authorizations. -- No domestic stock insurer, or any director, officer or employee of such insurer subject to Section 2.1 of these rules hereof, or any other person, shall solicit, or permit the use of his name to solicit, by mail or otherwise, any proxy, consent or authorization in respect of any stock of such insurer in contravention of this regulation.2.3. Disclosure of equivalent information. -- Unless proxies, consents or authorizations in respect of a stock of a domestic insurer subject to Section 2.1 of these rules hereof, are solicited by or on behalf of the management of such insurer from the holders of record of stock of such insurer in accordance with this regulation prior to any annual or other meeting, such insurer shall, in accordance with this regulation and/or such further regulations as the Commissioner may adopt, file with the Commissioner and transmit to all stockholders of record information substantially equivalent to the information which would be required to be transmitted if a solicitation were made.2.4. Definitions. (a) The definitions and instructions set out in Schedule SIS, as promulgated by the National Association of Insurance Commissioners, shall be applicable for purposes of this regulation.(b) The terms "Solicit" and "Solicitation" for purposes of this regulation shall include: (1) Any request for a proxy, whether or not accompanied by or included in a form of proxy; or(2) Any request to execute or not to execute, or to revoke, a proxy; or(3) The furnishing of a proxy or other communication to stockholders under circumstances reasonably calculated to result in the procurement, withholding or revocation of a proxy.(c) The terms "Solicit" and "Solicitation" shall not include:(1) Any solicitation by a person in respect of stock of which he is the beneficial owner;(2) Action by a broker or other person in respect to stock carried in his name or in the name of his nominee in forwarding to the beneficial owner of such stock soliciting material received from the company, or impartially instructing such beneficial owner to forward a proxy to the person, if any, to whom the beneficial owner desires to give a proxy, or impartially requesting instructions from the beneficial owner with respect to the authority to be conferred by the proxy and stating that a proxy will be given if the instructions are received by a certain date;(3) The furnishing of a form of proxy to a stockholder upon the unsolicited request of such stockholder or the performance by any person of ministerial acts on behalf of a person soliciting a proxy.2.5. Information to be furnished to stockholders. (a) No solicitation subject to this regulation shall be made unless each person solicited is concurrently furnished or has previously been furnished with a written proxy statement containing the information specified in Section 3 of these rules.(b) If the solicitation is made on behalf of the management of the insurer and relates to an annual meeting of stockholders at which directors are to be elected, each proxy statement furnished pursuant to Subdivision (c) hereof shall be accompanied or preceded by an annual report (in preliminary or final form) to such stockholders containing such financial statements for the last fiscal year as are referred to in Schedule SIS under the heading "Financial Reporting to Stockholders." Subject to the foregoing requirements with respect to financial statements, the annual report to stockholders may be in any form deemed suitable by the management.(c) Two (2) copies of each report sent to the stockholders pursuant to Section 2.5 of this part shall be mailed to the Commissioner not later than the date on which such report is first sent or given to stockholders or the date on which preliminary copies of solicitation material are filed with the Commissioner, pursuant to Subdivision (a), of Section 2.7 of this part, whichever date is later.2.6. Requirements as to proxy. (a) The form of proxy (i) shall indicate in bold-face type whether or not the proxy is solicited on behalf of the management, (ii) shall provide a specifically designated blank space for dating the proxy and (iii) shall identify clearly and impartially each matter or group of related matters intended to be acted upon, whether proposed by the management or stockholders. No reference need be made to proposals as to which discretionary authority is conferred pursuant to Subdivision (c) hereof.(b) Means shall be provided in the proxy for the person solicited to specify by ballot a choice between approval or disapproval of each matter or group of related matters referred to therein, other than elections to office. A proxy may confer discretionary authority with respect to matters as to which a choice is not so specified if the form of proxy states in bold-face type how it is intended to vote the shares or authorization represented by the proxy in each such case.(c) A proxy may confer discretionary authority with respect to other matters which may come before the meeting: Provided, That the persons on whose behalf the solicitation is made are not aware a reasonable time prior to the time the solicitation is made that any other matters are to be presented for action at the meeting: And provided further, That a specific statement to that effect is made in the proxy statement or in the form of proxy.(d) No proxy shall confer authority (i) to vote for the election of any person to any office for which a bona fide nominee is not named in the proxy statement, or (ii) to vote at any annual meeting other than the next annual meeting (or any adjournment thereof) to be held after the date on which the proxy statement and form of proxy are first sent or given to stockholders.(e) The proxy statement or form of proxy shall provide, subject to reasonable specified conditions, that the proxy will be voted and that where the person solicited specifies by means of ballot provided pursuant to Subdivision (b) hereof a choice with respect to any matter to be acted upon, the vote will be in accordance with the specifications so made.(f) The information included in the proxy statement shall be clearly presented and the statements made shall be divided into groups according to subject matter, with appropriate headings. All printed proxy statements shall be clearly and legibly presented.2.7. Material required to be filed. (a) Two (2) preliminary copies of the proxy statement and form of proxy and any other soliciting material to be furnished to stockholders concurrently therewith shall be filed with the Commissioner at least ten (10) days prior to the date definitive copies of such material are first sent or given to stockholders or such shorter period prior to that date as the Commissioner may authorize upon a showing of good cause therefor.(b) Two (2) preliminary copies of any additional soliciting material relating to the same meeting or subject matter to be furnished to stockholders subsequent to the proxy statements shall be filed with the Commissioner at least two (2) days (exclusive of Saturdays, Sundays or holidays) prior to the date copies of this material are first sent or given to stockholders or a shorter period prior to such date as the Commissioner may authorize upon a showing of good cause therefor.(c) Two (2) definitive copies of the proxy statement, form of proxy and all other soliciting material, in the form in which this material is furnished to stockholders, shall be filed with, or mailed for filing to, the Commissioner not later than the date such material is first sent or given to the stockholders.(d) Where any proxy statement, form of proxy or other material filed pursuant to these rules is amended or revised, two (2) of the copies shall be marked to clearly show such changes.(e) Copies of replies to inquiries from stockholders requesting further information and copies of communications which do no more than request that forms of proxy theretofore solicited be signed and returned need not be filed pursuant to this section.(f) Notwithstanding the provisions of Subdivisions (a) and (b) hereof and of Subdivision (e), of Section 2.10 of these rules, copies of soliciting material in the form of speeches, press releases and radio or television scripts may, but need not, be filed with the Commissioner prior to use or publication. Definitive copies, however, shall be filed with or mailed for filing to the Commissioner as required by Subdivision (c) hereof not later than the date such material is used or published. The provisions of Subdivisions (a) and (b) hereof and Subdivision (e), Section 2.10 of these rules, shall apply, however, to any reprints or reproductions of all or any part of such material.2.8. False or misleading statements. -- No solicitation subject to this regulation shall be made by means of any proxy statement, form of proxy, notice of meeting, or other communication, written or oral, containing any statement which at the time and in the light of the circumstances under which it is made, is false or misleading with respect to any material fact, or which omits to state any material fact necessary in order to make the statements therein not false or misleading or necessary to correct any statement in any earlier communication with respect to the solicitation of a proxy for the same meeting or subject matter which has become false or misleading.2.9. Prohibition of certain solicitations. -- No person making a solicitation which is subject to this regulation shall solicit any undated or postdated proxy or any proxy which provides that it shall be deemed to be dated as of any date subsequent to the date on which it is signed by the stockholder. 2.10. Special provisions applicable to election contests.(a) Applicability. -- Section 2.10 of these rules shall apply to any solicitation subject to this regulation by any person or group for the purpose of opposing a solicitation subject to this regulation by any other person or group with respect to the election or removal of directors at any annual or special meeting of stockholders.(b) Participant or participant in a solicitation.(1) For purposes of Section 2.10 of these rules, the terms "Participant" and "Participant in a Solicitation" include: (ii) any director of the insurer and any nominee for whose election as a director proxies are solicited; (iii) any other person, acting alone or with one or more other persons, committees or groups, in organizing, directing or financing the solicitation.(2) For the purposes of Section 2.10 of these rules, the terms "Participant" and "Participant in a Solicitation" do not include: (i) A bank, broker or dealer who, in the ordinary course of business, lends money or executes orders for the purchase or sale of stock and who is not otherwise a participant; (ii) any person or organization retained or employed by a participant to solicit stockholders or any person who merely transmits proxy soliciting material or performs ministerial or clerical duties; (iii) any person employed in the capacity of attorney, accountant, or advertising, public relations or financial adviser and whose activities are limited to the performance of his duties in the course of such employment; (iv) any person regularly employed as an officer or employee of the insurer or any of its subsidiaries or affiliates who is not otherwise a participant; or (v) any officer or director of, or any person regularly employed by any other participant if such officer, director or employee is not otherwise a participant.(c) Filing of information required by Section 4 of these rules.(1) No solicitation subject to Section 2.10 of these rules shall be made by any person other than the management of an insurer unless at least five (5) business days prior thereto, or such shorter period as the Commissioner may authorize upon a showing of good cause therefore, there has been filed, with the Commissioner by or on behalf of each participant in such solicitation, a statement in duplicate containing the information specified by Section 4 of these rules and a copy of any material proposed to be distributed to stockholders in furtherance of such solicitation. Where preliminary copies of any materials are filed, distribution to stockholders should be deferred until the Commissioner's comments have been received and complied with.(2) Within five (5) business days after a solicitation subject to Section 2.10 of these rules is made by the management of an insurer, or such longer period as the Commissioner may authorize upon a showing of good cause therefor, there shall be filed with the Commissioner by or on behalf of each participant in such solicitation, other than the insurer, and by or on behalf of each management nominee for director, a statement in duplicate containing the information specified by Section 4 of these rules.(3) If any solicitation on behalf of management or any other person has been made, or if proxy material is ready for distribution, prior to a solicitation subject to Section 2.10 of these rules, in opposition thereto, a statement in duplicate containing the information specified in Section 4 of these rules shall be filed with the Commissioner, by or on behalf of each participant in such prior solicitation, other than the insurer, as soon as reasonably practicable after the commencement of the solicitation in opposition thereto.(4) If, subsequent to the filing of the statements required by Paragraphs (1), (2) and (3) of this subdivision, additional persons become participants in a solicitation subject to this rule, there shall be filed with the Commissioner, by or on behalf of each such person, a statement in duplicate containing the information specified by Section 4 of these rules, within three (3) business days after such person becomes a participant or such longer period as the Commissioner may authorize upon a showing of good cause therefor.(5) If any material change occurs in the facts reported in any statement filed by or on behalf of any participant, an appropriate amendment to such statement shall be filed promptly with the Commissioner.(6) Each statement and amendment thereto filed pursuant to this paragraph shall be part of the public files of the Commissioner.(d) Solicitations prior to furnishing required proxy statement. Notwithstanding the provisions of Subdivision (a) of Section 2.5 of these rules, a solicitation subject to Section 2.10 of these rules, may be made prior to furnishing stockholders a written proxy statement containing the information specified in Section 3 of these rules with respect to such solicitation: Provided, That (1) The statements required by Subdivision (c) hereof are filed by or on behalf of each participant in such solicitation.(2) No form of proxy is furnished to stockholders prior to the time the written proxy statement required by Subdivision (a), of Section 2.5 of these rules, is furnished to such persons: Provided, however, That this Paragraph (2) shall not apply where a proxy statement then meeting the requirements of Section 3 of these rules has been furnished to stockholders.(3) At least the information specified in Paragraphs (2) and (3) of the statements required by Subdivision (c) hereof to be filed by each participant, or an appropriate summary thereof, are included in each communication sent or given to stockholders in connection with the solicitation.(4) A written proxy statement containing the information specified in Section 3 of these rules, with respect to a solicitation is sent or given to stockholders at the earliest practicable date.(e) Solicitations prior to furnishing required written proxy statements -filing requirement. -- Two (2) copies of any soliciting material proposed to be sent or given to stockholders prior to the furnishing of the written proxy statement required by Subdivision (a) of 2.5 of these rules, shall be filed with the Commissioner in preliminary form at least five (5) business days prior to the date definitive copies of such material are first sent or given to such persons or such shorter period as the Commissioner may authorize upon a showing of good cause therefor.(f) Application of this section to report. -- Notwithstanding the provisions of Subdivisions (b) and (c) of 2.5 of these rules, two (2) copies of any portion of the report referred to in Subdivision (b) of Section 2.5 of these rules, which comments upon or refers to any solicitation subject to Section 2.10 of these rules, or to any participant in any such solicitation, other than the solicitation by the management, shall be filed with the Commissioner, as proxy material subject to this regulation. Such portion of the report shall be filed with the Commissioner, in preliminary form, at least five (5) business days prior to the date copies of the report are first sent or given to stockholders.