Section 21.69.140. Bond.

   (a) Except as provided in AS 21.69.230, the director may not issue a solicitation permit until the person applying for it files with the director a corporate surety bond in the penalty of $10,000, in favor of the state and for the use and benefit of the state and of subscribers and creditors of the proposed organization.
   (b) The bond shall be conditioned upon the payment of costs incurred by the state in the event of a legal proceeding for liquidation or dissolution of the proposed organization before completion of organization or if a certificate of authority is not granted; and upon a full accounting for funds received until the proposed insurer has been granted its certificate of authority, or until the proposed corporation or syndicate has completed its organization as defined in the solicitation permit.
   (c) In lieu of filing the bond, the person may deposit with the director $10,000 in cash or in United States government bonds at par value, to be held in trust upon the same conditions as required for the bond.
   (d) The director may waive the requirement for a bond or deposit in lieu of a bond if the permit provides that
        (1) the proposed securities are to be distributed solely and finally to those few persons who are the active promoters intimate to the formation of the insurer, or other corporation or syndicate; or
        (2) the securities are to be issued in connection with subsequent financing as provided in AS 21.69.200.
   (e) A bond filed or deposit or remaining portion of a bond held under this section shall be released and discharged upon settlement or termination of all liabilities against it.

Authorities

21.69.080;21.69.090

Notes

References

AS 21.69.080 Procedure upon application.
AS 21.69.090 Issuance of permit.

History

(Sec. 1 ch 120 SLA 1966)