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Current through October 23, 2012
(a) If a company amends its articles of incorporation by providing for an increase of its capital stock, such increase shall be subscribed and fully paid up within 1 year of the date of such amendment, unless the Commissioner shall certify his consent to an extension of such time. Failure to have such increase of capital stock paid up within the time provided may be considered grounds for ousting the company from its powers under any such amendment to such articles of incorporation by a court of competent jurisdiction in a proceeding by the Commissioner, the Corporation Counsel representing him, against the company for such judgment.
(b) Subsection (a) of this section shall not be applicable to an amendment of the articles of incorporation providing for an increase of capital stock wherein said amendment provides that said increase will be reserved for issuance for: (1) the acquisition of the ownership or control of another insurance company as an affiliate or subsidiary subject to the limitations of § 31-4435(a)(10)(B); provided, however, that no such acquisition shall be consummated until it has been approved or ratified by stockholders representing at least a majority of the capital stock entitled to votes; (2) the granting of options to officers or employees of the company to purchase authorized but unissued shares of stock of the company, for such consideration and upon such terms and conditions as may be fixed by the board of directors; provided, however, that: (A) at no time shall the number of shares reserved for this purpose exceed, in the aggregate, 5% of the total authorized shares of stock of the company; (B) no more than 10% of the total number of shares authorized to be optioned may be made available to any individual under any and all options issued to him by the company; (C) no option shall be promised or granted: (i) to any individual employed by an insurance company authorized to do business in the District of Columbia (other than the company promising or granting the option or a subsidiary of the company promising or granting the option) while that individual is so employed; or (ii) to any individual within 2 years following the termination of his employment with such an insurance company; (D) the option price of shares subject to any such option shall not be less than 95% of the fair market value of such shares at the time the option is granted and shall be not less than the par value of such shares; (E) any such option shall not be transferable except by will or the laws of descent and distribution; and (F) any such option shall not be exercisable after the expiration of 10 years from the time the option is granted; or (3) the paying of stock dividends; provided, that at no time shall the number of shares of reserved unissued stock exceed the number of shares of issued and outstanding shares of stock of said company.
(June 19, 1934, 48 Stat. 1146, ch. 672, ch. III, § 10; Aug. 31, 1964, 78 Stat. 765, Pub. L. 88-556, § 4; May 21, 1997, D.C. Law 11-268, § 10(k), 44 DCR 1730; Mar. 24, 1998, D.C. Law 12-81, § 24(a), 45 DCR 745.)
HISTORICAL AND STATUTORY NOTES
Prior Codifications
1981 Ed., § 35-610.
1973 Ed., § 35-510.
Legislative History of Laws
For legislative history of D.C. Law 11-268, see Historical and Statutory Notes following § 31-4402.
Law 12-81, the "Technical Amendments Act of 1998." was introduced in Council and assigned Bill No. 12-408, which was referred to the Committee of the Whole. The Bill was adopted on first and second readings on November 4, 1997 and December 4, 1997, respectively. Signed by the Mayor on December 22, 1997, it was assigned Act No. 12-246 and transmitted to both Houses of Congress for its review. D.C. Law 12-81 became effective on March 24, 1998.
Miscellaneous Notes
Department of Insurance abolished: See Historical and Statutory Notes following § 31-4402.
