1126                           LAWS OF MARYLAND                       [CH. 553

Such agreement, executed under corporate seal by officers of the
company authorized for the purpose, and with evidence of its adop-
tion shall be submitted to the Commissioner. If it appears that the
requirements of this section have been complied with, the Commis-
sioner shall so certify and approve the agreement by his endorse-
ment thereon. One of the duplicates shall thereupon be filed in his
office and the other duplicate shall be delivered to the continuing
company.

(b)   One or more domestic mutual insurance companies may merge
or consolidate under the laws of any state of the United States with
a foreign mutual insurance company or companies and form a sur-
viving company or a new company under the laws of one of the
foreign states in which one of the parties may have its domicile. Each
domestic company shall follow the procedure prescribed in subsection
(a) of this Act. All of the parties to such agreement shall not be re-
quired to be licensed in this State at the time of the merger or con-
solidation if application for license shall have been filed on behalf of
the surviving company, signed by all parties to the agreement, pro-
vided that in the opinion of the Commissioner the surviving or new
company shall meet the tests of solvency and shall have complied or
agreed to comply with the laws of this State pertaining to the ad-
mission and authorization of foreign companies.

The procedure required of a foreign company shall be that which
is prescribed by the state of its domicile with respect to a merger or
consolidation and the Commissioner shall require the certificate of
the official having supervision over the business of insurance in the
state of domicile of each party, respectively, to the agreement that
each party domiciled in such state has complied with the laws of its
state of domicile with respect to merger or consolidation.

(c)   The agreement of merger or consolidation shall either state
the time when it shall be effective, if the said effective date be sub-
sequent to the date of approval by the Commissioner, otherwise the
agreement shall be effective as of the date on which the last certifi-
cate of approval is executed by the insurance supervising official of
the state of domicile of any of the parties to the agreement.

In the event of a merger or consolidation, the following condi-
tions shall apply:

(1)   The surviving company or new company may require the re-
turn of the original policies held by each policyholder in each of the
companies merged or consolidated and issue in lieu thereof new
policies as the policyholders may be entitled to receive.

(2)   Upon such merger or consolidation, all rights and properties
of the parties to the agreement shall accrue to and become the rights
and properties of the surviving company or new company, which
surviving or new company shall succeed to and assume all the obli-
gations and liabilities of the merged or consolidated companies in the
same manner as if incurred or contracted by the surviving or new
company.

(3)   The policyholders of the merged or consolidated companies
shall continue to be subject to all the liabilities, claims and demands
existing against them at or before such merger or consolidation. No
action or proceeding pending at the time of the merger or consoli-
dation to which any of the companies merged or consolidated may be