(215 ILCS 5/16) (from Ch. 73, par. 628)
(Section scheduled to be repealed on January 1, 2027)
Sec. 16.
Organization bonds.
(1) The incorporators except as stated in
subsection (3) of this Section, shall deliver to the Director two bonds in favor
of the State of Illinois, in the penalty of $50,000 each, with
the incorporators as principals and a duly authorized surety company as
surety. One of such bonds shall be for the use and benefit of the State of
Illinois, and shall be conditioned upon the payment of costs incurred by
the State by reason of any legal proceedings for liquidation or dissolution
of such company prior to the issuance to it of a certificate of authority
to do an insurance business. The other bond shall be for the use and
benefit of subscribers, shareholders and creditors, and shall be
conditioned upon the full and complete accounting for all funds and
property coming into the possession of the incorporators or into the
possession of the company prior to the issuance to it of a certificate of
authority to do an insurance business.
(2) In lieu of delivering the above bonds, the incorporators may deposit
with the Director $100,000 in cash or securities of the
United States Government or of the State of Illinois, having a market value
of at least $100,000. The cash or securities so deposited
shall be held in trust by the Director, until the issuance of a certificate
of authority to the company, to indemnify the State of Illinois and all
subscribers, shareholders and creditors of the company for the same matters
and things set forth as conditions of the organization bonds mentioned in
subsection (1).
(3) No bonds are required if the stock of the company is to be
purchased by a sole shareholder.
(Source: P.A. 84-1431.)
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