20-828. Deposit for protection of members

312 words·~1 min read·/az/title-20/20-828

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

A. Corporations governed by this article shall at all times have on deposit with the state treasurer the following amounts:

1. If newly formed under this article, two hundred thousand dollars.

2. If formed under prior law, such amount as was so required under prior law.

B. Every such corporation each year shall deposit with the state treasurer, not later than February 1, an amount equal to two per cent of the gross subscriptions collected during the preceding calendar year, until the deposit of the corporation reaches a total of five hundred thousand dollars. All such deposits shall be held by the state treasurer in trust for the benefit and protection of the subscribers of the corporation making the deposit.

C. The deposit prescribed by this section shall be subject to withdrawal in whole or in part on the order of and as directed by the director, but may, with the approval of the director, be invested pursuant to section 35-313. Interest earned on the deposits shall be payable to the corporation making the deposit.

D. An unsettled final judgment, arising upon a certificate of participation against such a corporation, shall be a lien on the deposit prescribed by this section, subject to execution after thirty days from the entry of final judgment. If the deposit is reduced thereby, it shall be replenished within ninety days.

E. Upon the liquidation or dissolution of the corporation and the satisfaction of all its liabilities, any balance remaining in the deposit in the hands of the state treasurer and any other assets of the insurer shall be distributed to the holders of certificates of participation in good standing at the time proceedings for the liquidation or dissolution of the corporation were commenced, prorated according to the gross amount of subscriptions which have been paid on the certificates up to the time such proceedings were commenced.