§ 58-24-45. Organization.
§58‑24‑45. Organization.
A domestic society organizedon or after January 1, 1988 shall be formed as follows:
(a) Ten or more citizensof the United States, a majority of whom are citizens of this State, who desireto form a fraternal benefit society, may make, sign and acknowledge before someofficer competent to take acknowledgement of deeds, articles of incorporation,in which shall be stated:
(1) The proposedcorporate name of the society, which shall not so closely resemble the name ofany society or insurance company as to be misleading or confusing;
(2) The purposes forwhich it is being formed and the mode in which its corporate powers are to beexercised. Such purposes shall not include more liberal powers than are grantedby this Article;
(3) The names andresidences of the incorporators and the names, residences and official titlesof all the officers, trustees, directors, or other persons who are to have andexercise the general control of the management of the affairs and funds of thesociety for the first year or until the ensuing election at which all suchofficers shall be elected by the supreme governing body, which election shallbe held not later than one year from the date of issuance of the permanentlicense.
(b) Such articles ofincorporation, duly certified copies of the society's bylaws and rules, copiesof all proposed forms of certificates, applications therefor, and circulars tobe issued by the society and a bond conditioned upon the return to applicantsof the advanced payments if the organization is not completed within one yearshall be filed with the Commissioner, who may require such further informationas the Commissioner deems necessary. The bond with sureties approved by theCommissioner shall be in such amount, not less than three hundred thousanddollars ($300,000) nor more than one million five hundred thousand dollars($1,500,000), as required by the Commissioner. All documents filed are to be inthe English language. If the purposes of the society conform to the requirementsof this chapter and all provisions of the law have been complied with, theCommissioner shall so certify, retain and file the articles of incorporationand furnish the incorporators a preliminary license authorizing the society tosolicit members as hereinafter provided.
(c) No preliminarylicense granted under the provisions of this section shall be valid after oneyear from its date or after such further period, not exceeding one year, as maybe authorized by the Commissioner upon cause shown, unless the 500 applicantshereinafter required have been secured and the organization has been completedas herein provided. The articles of incorporation and all other proceedingsthereunder shall become null and void in one year from the date of the preliminarylicense, or at the expiration of the extended period, unless the society shallhave completed its organization and received a license to do business ashereinafter provided.
(d) Upon receipt of apreliminary license from the Commissioner, the society may solicit members forthe purpose of completing its organization, shall collect from each applicantthe amount of not less than one regular monthly premium in accordance with itstable of rates, and shall issue to each such applicant a receipt for the amountso collected. No society shall incur any liability other than for the return ofsuch advance premium, nor issue any certificate, nor pay, allow, or offer orpromise to pay or allow, any benefit to any person until:
(1) Actual bona fideapplications for benefits have been secured on not less than 500 applicants,and any necessary evidence of insurability has been furnished to and approvedby the society;
(2) At least 10subordinate lodges have been established into which the 500 applicants havebeen admitted;
(3) There has beensubmitted to the Commissioner, under oath of the president or secretary, orcorresponding officer of the society, a list of such applicants, giving theirnames, addresses, date each was admitted, name and number of the subordinate lodgeof which each applicant is a member, amount of benefits to be granted andpremiums therefor; and
(4) It shall have beenshown to the Commissioner, by sworn statement of the treasurer, orcorresponding officer of such society, that at least 500 applicants have eachpaid in cash at least one regular monthly premium as herein provided, whichpremiums in the aggregate shall amount to at least one hundred and fiftythousand dollars ($150,000). Said advance premiums shall be held in trustduring the period of organization and if the society has not qualified for alicense within one year, as herein provided, such premiums shall be returned tosaid applicants.
(e) The Commissioner maymake such examination and require such further information as the Commissionerdeems advisable. Upon presentation of satisfactory evidence that the societyhas complied with all the provisions of law, the Commissioner shall issue tothe society a license to that effect and that the society is authorized totransact business pursuant to the provisions of this Article. The license shallbe prima facie evidence of the existence of the society at the date of suchcertificate. The Commissioner shall cause a record of such license to be made.A certified copy of such record may be given in evidence with like effect asthe original license.
(f) Any incorporatedsociety authorized to transact business in this State at the time this Articlebecomes effective shall not be required to reincorporate. (1987,c. 483, s. 2; 1991, c. 720, s. 4; 1999‑132, s. 9.1.)