| A. Prior to the termination of any liquidation, | rehabilitation or conservation proceeding, the court may | take into consideration the contributions of the respective | parties, including the association, the shareholders and | policy owners of the impaired or insolvent insurer and any | other party with a bona fide interest, in making an | equitable distribution of the ownership rights of the | impaired or insolvent insurer. In such a determination, | consideration shall must be given to the welfare of the | policyholders policy owners of the continuing or successor | insurer. |
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| B. No distribution to stockholders, if any, of an impaired | or insolvent insurer shall may be made until and unless the | total amount of assessments levied by the association with | respect to the insurer have been fully recovered by the | association. |
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| | 5. Unfair trade practice. It shall be a prohibited unfair | trade practice for any person to make use in any manner of the | protection afforded by this chapter in the sale of insurance. |
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| | 6. Recovery procedure; provisions. The recovery procedure | shall must provide that: |
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| A. If an order for liquidation or rehabilitation of an | insurer domiciled in this State has been entered, the | receiver appointed under that order shall have has a right | to recover on behalf of the insurer, from any affiliate that | controlled it, the amount of distributions, other than stock | dividends paid by the insurer on its capital stock, made at | any time during the 5 years preceding the petition for | liquidation or rehabilitation subject to the limitations of | paragraphs B to D; |
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| B. No such dividends shall distribution may be recoverable | if the insurer shows that when paid the distribution was | lawful and reasonable and that the insurer did not know and | could not reasonably have known that the distribution might | adversely affect the ability of the insurer to fulfill its | contractual obligations; |
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| C. Any person who was an affiliate that controlled the insurer | at the time the distributions were paid shall be is liable up to | the amount of distributions he the person received. Any person | who was an affiliate that controlled the insurer at the time the | distributions were declared shall be is liable up to the amount | of distributions he the person would have received if they had | been paid immediately. If 2 or more persons are liable with | respect to |
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